Victorian business slapped with $375k penalty for underpaying migrant workers

A business that operated waste and management facilities in Melbourne will pay $375,515 in penalties for underpaying five migrant workers.

The Fair Work Ombudsman (FWO) has secured the amount following an investigation found that the five workers – who were on protection visas and bridging visas after arriving in Australia as refugees from southern Asia – were unpaid a total of $194,249 over a 20-month period.

Between 2018 and 2019, the workers – who spoke limited English – were employed to sort waste at facilities in Dandenong and Hallam, operated by Polytrade at the time.

Polytrade was one of the biggest recycling companies in the state at the time and held waste management contracts with several local government bodies.

FWO investigated after receiving a referral from the Australian Workers’ Union.

“Fair Work Inspectors discovered that the five affected employees were paid a flat rate of $22 per hour regardless of when they performed work, despite being required to perform night, weekend and public holiday work. Some of the workers gave evidence in court that they worked 12-hour shifts, usually six and sometimes seven days per week,” a statement from the Ombudsman said.

“This resulted in underpayment of workers’ minimum wage rate; overtime rates; loadings for casual, night and shift work; and penalty rates for weekend and public holiday work, under the Waste Management Award 2010.

“Laws relating to minimum engagement periods, advising employees of their terms of engagement, payment of superannuation entitlements, record keeping and issuing pay slips in the required form were also breached.”

As such, the Federal Court imposed $375,515 in penalties. Broken down, this amounts to:

• $138,600 against Polytrade, now known as PT 349 Pty Ltd, for being an accessory in the underpayment of the workers.
• $200,375 against PTES 928 Pty Ltd (formerly Polytrade Employment Services Pty Ltd) for directly underpaying the workers. PTES 928 Pty Ltd was set up as a labour provider, employing workers and supplying them to work at Polytrade on an on-hire basis.
• $27,720 and $8,820, respectively, against Polytrade’s owners, husband and wife Mr Man Sang Cheng and Ms Pui Shan Ho, for also being accessories in the underpayments. Ms Ho is also the owner of PTES 928 Pty Ltd.

It is worth noting that PTES 928 Pty Ltd has back-paid the five underpaid workers in full – and has also made a further $2.2 million in back-payment to workers not involved in the FWO’s legal action but who had been underpaid since 2012.

Commenting on the matter, acting Fair Work Ombudsman Kristen Hannah said blatant underpayment of visa holders in Australia is not tolerated.

“We treat underpayment of migrant workers particularly seriously. These workers can be vulnerable if they are unaware of their entitlements or reluctant to complain. But visa holders have the same workplace rights as all other workers,” she said.

“Any employer that blatantly underpays migrant workers’ basic entitlements risks facing significant penalties. The five workers here were paid only slightly more than half of what they were entitled to.”

“Workers with concerns about their pay or entitlements should contact us for free advice and assistance.”

Meanwhile, Justice John Snaden said the contravening conduct was “wantonly naïve, at best. At worst, it involved a deliberate and cavalier disregard of important award safety net obligations”.

The five workers “were paid between 53 and 58 per cent only of what the award required that they be paid. On any view, those are damning figures”, Justice Snaden said, noting the contraventions were “made worse by considering the personal circumstances of the relevant employees”.

“All are from migrant backgrounds and have limited to negligible written and verbal English skills,” he said.

“The court must exact a heavy toll: not merely to ensure that [PTES 928 Pty Ltd] is brought to account for its obnoxious conduct but also to serve as a warning to other employers who might be minded to ignore their own important award and statutory obligations in the way that [PTES 928 Pty Ltd] did.”