Melbourne restaurant operator signs enforceable undertaking, backpays employees

During an investigation and subsequent surprise inspection of an Italian restaurant in 2024, the Fair Work Ombudsman (FWO) uncovered evidence of underpayments affecting both kitchen and front-of-house staff.

Carlucci’s Restaurant in Templestowe, operated by The Luck Bird Pty Ltd, was found to have underpaid wait staff, cooks, and kitchen attendants between June 2023 and July 2025, in amounts ranging from $189 to $20,042. Five of those impacted were visa holders from Nepal and India, owed between $1,264 to the same $20,042 figure.

In addition, seven of the workers were identified as juniors, the youngest 15, and were owed from $305 to $8,754.

Specifically, the employer was found to have paid flat rates that they believed covered additional entitlements, including overtime and penalties.

The subsequent underpayment of minimum hourly rates, penalty rates, overtime rates, annual leave loading, casual loading, and annual leave loading on termination was determined to be a breach of the Restaurant Industry Award 2020.

Due to the restaurant’s co-operation with the FWO investigation, it was decided that the signing of an enforceable undertaking – a legally binding agreement that allows the accused party to, should it comply, avoid court prosecution – was an appropriate next step.

The restaurant operator rectified the underpayments in full – totalling $194,011 – and put in place processes to prevent it from occurring again.

Under the EU with the FWO, The Luck Bird Pty Ltd also agreed to commission at least one independent audit to check current compliance, write to all current and former underpaid employees to inform them of the EU and apologise, report their new systems to the FWO, create and implement an approved Restaurant Industry Award training document, hold paid monthly meetings, and operate an email to take inquiries and report to the FWO.

On the incident, FWO Anna Booth stated: “We expect all employees to meet all their obligations under any relevant award and the Fair Work Act. Flat hourly rates of pay can commonly fail to meet hardworking employees’ full range of entitlements.

“Penalty rates, for example, are important legal entitlements to compensate staff working often unsociable hours when most others are not.

“Improving compliance in the fast food, restaurants and cafes sector is a priority for the Fair Work Ombudsman. This sector hires a lot of visa holders and young workers, who can be vulnerable.

“We encourage employers to take advantage of the free tools and resources we offer via fairwork.gov.au, the Fair Work Infoline and the Employer Advisory Service *for small businesses) to get wages right.”

The investigation was itself part of a larger inspection of food businesses across north-east Melbourne.

Want to see more stories from trusted news sources?
Make HR Leader a preferred news source on Google.