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The Fair Work Ombudsman has issued a warning to employers that she is targeting the fast food, restaurant and café sector in an effort to improve workplace compliance.
“The sector continues to be a priority,” Ombudsman Sandra Parker said this week.
Her comments follow the decision by the Federal Circuit Court to impose $14,500 in penalties against the operators of the Jade Willow Chinese Restaurant, located at Ulverstone in Tasmania.
The court levied a $12,000 penalty against the company that operates the restaurant, Galb Pty Ltd, and a $2,500 penalty against the company’s sole director, Chao Liang.
These were imposed in response to the company and Liang breaching the Fair Work Act by failing to comply with a Compliance Notice requiring the company to calculate and back-pay entitlements for five young employees.
Parker said the decision showed that businesses failing to act on Compliance Notices would face court-imposed penalties, in addition to having to back-pay any underpaid staff.
“We make every effort to secure voluntary compliance with Compliance Notices, but where they are not followed we are prepared to take legal action to ensure workers receive their lawful entitlements,” Parker stated.
Fair Work Inspectors commenced an investigation into the Jade Willow Chinese Restaurant in 2018 after receiving a request for assistance from an employee.
A Compliance Notice was issued after an inspector formed a belief that food and beverage attendants at the restaurant had been underpaid minimum wage rates, weekend and public holiday penalty rates, casual loadings, late night additional payments and minimum two-hour shift pay under the Restaurant Industry Award.
The five employees at the restaurant had instead been paid flat rates of between $8 and $14 an hour.
Judge Grant Riethmuller said the contraventions resulted in payment delays for young employees and that it was “only after proceedings were commenced to prosecute the respondents for failing to comply with the notices that the payments were made, some 18 months after the Compliance Notice”.
The judge further noted that “a subsequent underpayment discovered in November 2019 suggests little has changed, despite the respondents saying that systems are now in place to ensure compliance”.
He said it was “most unfortunate” that court proceedings were needed and there was a need to deter others from similar conduct. “It is important that Compliance Notices are taken seriously by employers and not ignored.”