EWIN HANNAN
OCTOBER 29, 2019
The Australian
A Coffee Club cafe operator which significantly underpaid a Korean waitress by $37,000 over two years, paying her as little as $10 an hour and no superannuation, will not be prosecuted despite admitting to breaches of workplace laws.
Under a deal with the Fair Work Ombudsman, Ji Hae Hong has signed an undertaking that will see her backpay the worker, make a $3000 “contrition payment” to government revenue, engage auditors, and write a letter of apology to the former employee.
Ms Hong and Sean & Eddy Pty Ltd, trading as Coffee Club Blacktown, signed the court enforceable undertaking after admitting it underpaid the worker, did not issue her any pay slips or keep her employment records.
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Fair Work Inspectors found the worker was paid flat hourly rates of between $10 and $15.50, despite being entitled to ordinary hourly rates including casual loading of up to $25.28, up to $30.33 on weekends and up to $50.55 on public holidays under the restaurant industry award.
The unlawful conduct was only uncovered after the worker made a complaint to the ombudsman
The Korean national was in Australia on a working holiday visa and later a student visa during her employment at the cafe from September 2016 to October 2018.
Fair Work Ombudsman Sandra Parker said the undertaking was “appropriate” because the company had committed to “back-paying staff and will face ongoing scrutiny from inspectors”.
Migrant workers ‘particularly vulnerable’
“The Fair Work Ombudsman has no tolerance for employers who pay migrant workers flat rates that are below the pay they are lawfully entitled to under the relevant award,’’ she said.
“Migrant workers can be particularly vulnerable due to their visa status but are entitled to the same pay as any other worker.”
Under the undertaking, the company must engage independent external auditors to check that all employees receive correct entitlements in 2019 and 2020, and rectify any errors. It will write a letter of apology to the worker, and place a company notice in the Blacktown Advocate apologising.
The ombudsman last month commenced legal action against the operator of the Coffee Club franchise at the Westfield Geelong shopping centre for alleged underpayments of two young workers and providing false and misleading pay slips and records to Fair Work Inspectors.
In 2017, the ombudsman secured more than $180,000 in penalties against a former Coffee Club cafe franchisee in Brisbane for contraventions including requiring an overseas worker to pay back $18,000 of his wages through an unlawful cashback payment.
Ms Parker said improving compliance with workplace laws among franchises in the fast food, restaurant and cafe sector was a priority.
“We encourage any Coffee Club employees with pay concerns, or franchisees seeking help with their workplace obligations, to contact us for free advice and assistance,’’ she said.
“The Fair Work Ombudsman will closely monitor compliance with the court-enforceable Undertaking and will not hesitate to litigate if there are further breaches of workplace laws.”
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