Employees at the Yummy Noodle Box chain have been underpaid $642,311 over a three year period, the Fair Work Ombudsman has alleged.
The Ombudsman has commenced proceedings in the Federal Court in Sydney claiming six Chinese employees were underpaid a total of $642,311 by W.X.Z. Enterprises Pty Ltd at four stores in NSW and Queensland between July, 2010 and March, 2013.
The Ombudsman claims a Chinese cook on a 457 visa in Dubbo was underpaid $189,225 in less than three years.
The Ombudsman also claims a male supervisor and a female cook at a noodle bar on William Street, Bathurst, were underpaid $129,314 and $125,605 respectively, a female cook at a noodle bar on Bourbong Street, Bundaberg, was underpaid $92,086, and a female and a male cook at a shop on Summer Street, Orange, were underpaid $88,034 and $18,047 respectively.
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The FWO has also commenced proceedings against Xin Tai Xu and Xin Chun Xu, who were allegedly involved in managing the W.X.Z’s operations and underpaying the workers.
Court documents allege W.X.Z. paid the six employees a flat weekly wage as low as $530, despite them generally working up to seven days a week and often more than 60 hours a week.
It is claimed the workers were underpaid their minimum hourly rates, penalty rates for weekend and public holiday and overtime work.
Inspectors discovered the alleged underpayments when they investigated complaints lodged by employees.
Fair Work Ombudsman Natalie James said in a statement the significant amounts of money involved for vulnerable, foreign workers and a failure by the employer to rectify the alleged underpayments were significant factors in the FWO’s decision to take legal action.
Workplace law expert Peter Vitale told SmartCompany ignorance of the law is no excuse.
“Businesses have a basic obligation to ensure that any workers have a legal right to work in Australia, but they also need to make sure they are familiar with the award that applies to their business and that they understand what their minimum wage obligations are, and that they meet those obligations,” he says.
“If they are unsure of any of that they should speak to the Fair Work Ombudsman, their industry association if they are a member or they should get legal advice.”
Vitale says there are aspects of the award system that can be difficult to navigate but there is “no doubt” there are some businesses which simply take advantage of the system and of vulnerable workers.
“The Coalition government has indicated it will potentially look at amending the Fair Work Act so employers who take advice from the Ombudsman and act on it on a reasonable basis may be offered some form of relief in the event they are found later on to be underpaying,” Vitale says.
W.X.Z faces penalties of up to $51,000 per contravention and Xin Tai Xu and Xin Chun Xu each face penalties up to $10,200 per contravention.
SmartCompany attempted to contact W.X.Z with no success.