A restaurant in a New South Wales ski resort has been forced to reimburse 10 employees more than $3000 and issue a written apology after being caught out by the employer watchdog twice in less than a year.
Alfresco Pizzeria, based at Thredbo in the NSW Snowy Mountains, was audited in August last year and found to have paid workers as young as 15 and 17 flat rates of between $11 and $28 an hour.
The employees were collectively underpaid more than $3400 over three months, with individual underpayments ranging from $23 to $674.
In 2013, Alfresco Pizzeria was found to have underpaid 22 employees as much as $23,000 and received a formal letter of warning.
As a result of the most recent underpayments, the Fair Work Ombudsman asked the restaurant to sign an enforceable undertaking that requires the business to issue written apologies to the employees it underpaid.
Alfresco Pizzeria must also have an independent accountant audit its payslips and ensure future compliance with Australia’s workplace laws.
Fair Work Ombudsman Natalie James said an enforceable undertaking was used in this instance because the Ombudsman wants to encourage behavioural change within the business.
“We use enforceable undertakings where we have formed a view that a breach of the law has occurred but where the employer has acknowledged this and accepted responsibility and agreed to co-operate and fix the problem,” James said.
James acknowledged workplace laws can be very complicated for those who are not trained lawyers but she stressed small business owners still need to do the right thing.
“We are committed to helping employers understand and comply with workplace laws but operators need to make an effort to get the basics right in the first place,” she said.
“We know workplace laws can be complicated for the uninitiated, and for those who are not industrial experts, but we ask small business to use the tools and resources that we provide for them and not just apply arbitrary rates that seem about right.”
Peta Tumpey, partner at TressCox Lawyers, told SmartCompany while small business owners don’t often have dedicated HR managers, the Ombudsman does provide helpful resources when it comes to understanding the correct award rates.
“You’ve got the Fair Work Ombudsman’s site which has everything there,” Tumpey says.
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“It’s a great tool to use because they [small business owners] can put their industry in, their types of employees and it tells them their rates straight away. Also, if they are found to be in breach down the track they can show the Ombudsman they thought they were complying.”
Tumpey says it is encouraging to see the Fair Work Ombudsman using enforceable undertakings.
“Employers, if they are in breach and in a position to negotiate with the Ombudsman, are very fortunate because it can avoid expensive civil proceedings,” she says.
“Not only do you avoid having a civil penalty imposed on you, it’s very efficient for your employees who have been underpaid. If you can show the Fair Work Ombudsman that you’re remorseful, it always puts employers in a better position.”
SmartCompany contacted Doug Edwards, the owner of Alfresco Pizzeria, but he declined to comment.