Melbourne café cops $28k fine for ‘latte’ payment

A Black Rock-based café has copped $28,171 in total penalties for failing to back pay one of its cooks.

A $23,475 penalty has been imposed against KRC, which operates The Colonel’s Son in Black Rock, while the café’s manager – Rishi Chaudhari – was hit with a $4,696 penalty.

These fines came after a Fair Work Ombudsman (FWO) investigation found that the café failed to comply with a notice that required it to calculate underpayments and back pay a full-time cook who was employed at the café between February 2021 and February 2022.

It was alleged by the FWO that Chaudhari was directly involved in the contravention of dodging the compliance notice.

A Fair Work inspector issued the compliance notice in August 2023 after forming a belief the company had failed to pay the cook’s accrued but untaken annual leave entitlements when her employment came to an end.

“When compliance notices are not followed, we will continue to take legal action to protect employees,” Fair Work Ombudsman Anna Booth said, reiterating that employers must be aware of the stern consequences that arise when they fail to comply with a compliance notice.

“When compliance notices are not followed, we will continue to take legal action to protect employees. Employers who fail to act on these notices risk substantial penalties in addition to back paying workers.”

Booth acknowledged that businesses that fall under the café sector are under a heightened spotlight due to widespread contraventions occurring throughout the sector.

“Employers also need to be aware that taking action to improve compliance in the fast food, restaurants and cafés sector is among our top priorities,” Booth said.

KRC only initiated a back payment of $3,410 in entitlements after the FWO commenced its legal action.

Judge Jonathan Forbes labelled the efforts of the company paying the worker her lawful entitlements almost two years after it was due as a “last-minute attempt” after being “stunned into action” by the FWO – claiming the repayment “does not wipe the slate clean”.

“The former employee’s confidence in employment will have been shaken; she has gone without her entitlements for months, and the payment was only made when the writing was on the wall for the respondents,” Judge Forbes said.

In imposing the penalties, Judge Forbes said penalties needed to be “sufficiently serious to send a clear signal” to other employers that KRC and Chaudhari’s conduct was “unacceptable”.

“When put on notice as to the serious consequences of non-compliance, putting one’s head in the sand is no excuse,” said Judge Forbes.