Restaurant hit with $10k in penalties for underpaying migrant workers

Operators of a dumpling restaurant called Dumpling Land in Wallsend, Newcastle, have been slapped with a hefty $10,000 fine after underpaying migrant workers, mostly international students, and some under the age of 25.

Operators Kailiang Chen and Alex Du were fined $4,563.54 and $5,915.70, respectively, by the Fair Work Ombudsman (FWO) at the Federal Circuit and Family Court for breaches of the Fair Work Act.

Chen and Du operated Dumpling Land as a partnership, and they received penalties totalling $10,479, incurred as a result of failing to comply with a compliance notice.

In August 2023, a compliance notice was issued by an FWO inspector following suspicion that the partners “had underpaid 28 workers their minimum wages, overtime entitlements and penalty rates, owed under the Restaurant Industry Award 2020, between June 2021 and April 2023”, the FWO found.

Fair Work Ombudsman Anna Booth said: “When compliance notices are not followed, we will continue to take legal action to ensure workers receive all their lawful entitlements.”

According to the FWO, “the regulator investigated the matter as part of surprise inspections of Newcastle eateries in April 2023”.

“We treat cases impacting visa holders and young workers particularly seriously, because we are conscious they can be vulnerable due to factors such as a lack of awareness of their entitlements or a reluctance to complain,” Booth explained.

It was only after the investigation that the partners back paid 18 of the 28 staff members, it revealed.

“The affected 28 workers were engaged in full-time, part-time and casual roles as food and beverage attendants, kitchen hands and delivery drivers,” the FWO said.

On top of the penalties, the court ordered payment of $12,423 to six of those workers, plus superannuation and interest, and “to comply with the compliance notice by calculating and rectifying any underpayments owing to the other four workers”, it said.

Judge Natasha Laing said: “The penalties imposed in this matter should be sufficiently high to impress upon those in positions of responsibility the importance of complying with their legal obligations, and in particular the need to comply with statutory notices from the FWO.”

FWO secured nearly $23 million in penalties and filed 146 litigations against employers involving visa holder workers in the seven financial years to June 2024.

The penalties follow the Coles and Woolies underpayment proceedings, recent surprise inspections by FWO across Sydney, targeting employers of migrant and visa holder workers after a string of underpayment cases rife across the city, and a study that found one in three young workers experience underpayment from their employers, reported by HR Leader in July.

“Employers need to be aware that taking action to protect vulnerable workers is an enduring priority for the Fair Work Ombudsman. Any workers with concerns should contact us for free advice and assistance,” Booth said.