$4 million penalties against restaurant operators the second highest of its kind

Former operators of three Taiwanese restaurants have been hit with $4 million in penalties after “deliberately and systematically” underpaying staff. This is the second highest ever secured by the Fair Work Ombudsman (FWO).

As reported by the FWO, the migrant workers were taken advantage of through the employer’s use of falsified records.

According to FWO, the penalties were listed as:

• $1.99 million against DTF World Square Pty Ltd, which employed workers at Din Tai Fung restaurants at the World Square shopping centre in the Sydney CBD, Chatswood and Emporium shopping centre in the Melbourne CBD;
• $1.89 million against Selden Farlane Lachlan Investments Pty Ltd, which employed workers at the Emporium store;
• $92,232 against former General Manager of DTF World Square Ms Hannah Handoko (also known as Vera Handoko); and
• $105,084 against former HR Coordinator of DTF World Square Ms Sinthiana Parmenas.

“We welcome these penalties that demonstrate the serious nature of the offending by the respondents in this matter. Their actions resulted in vulnerable migrant workers being underpaid hundreds of thousands of dollars,” commented FWO, Anna Booth.

“The court has characterised the conduct of Din Tai Fung as ‘a calculated scheme to rob employees of their hard-earned wages’. The FWO agrees that the underpayment of wages in this matter was extremely serious. Serious consequences await any business found to be engaging in such calculated and systemic conduct such as the type uncovered in this matter.”

“Employers also need to be aware that taking action to protect visa holders and improve compliance in the fast food, restaurant and café sector are among our top priorities. Lawful minimum rates apply to all employees in Australia and they are not negotiable. All workers in Australia have the same rights, regardless of nationality and visa status. Anyone with concerns about their pay or entitlements should contact us for free assistance, including anonymously,” Booth said.

Due to the maliciousness in these actions, the employers attracted maximum penalties. The Federal Court found the two companies committed multiple breaches of the Fair Work Act, and Justice Anna Katzmann noted they “deliberately deprived the employees of their legislated entitlements and contrived to disguise their wrongdoing through the creation of a false set of records.”

“It goes without saying that the respondents’ conduct was extremely serious. This was not merely deliberate wrongdoing. It was deceitful and unscrupulous. It involved a calculated scheme to rob employees of their hard-earned wages and deceive the authorities,” explained Katzmann.

A total of 17 employees were affected by these dealings, mostly from Indonesia and China, and were deliberately underpaid $157,025 between November 2017 and June 2018. However, one full-time employee, was the highest underpaid, from July 2014 to May 2018

The operators reportedly kept and provided false records to Fair Work Inspectors. Under the Protecting Vulnerable Workers laws, the maximum penalties for serious contraventions are 10-times the penalties which would ordinarily apply. FWO intervened after receiving a request for assistance from an affected worker.

“It is difficult to conceive of any circumstances in which the introduction and operation of a dishonest scheme to deprive employees of their statutory entitlements to minimum wages or conditions would ever warrant anything but the imposition of substantial penalties,” Katzmann said.

Individual underpayments ranged from $2,165 to $50,588. Most of the highest underpaid worker’s alleged underpayments related to unpaid overtime.