Exploitation of vulnerable workers proves very costly for Melbourne retailers

In an important decision this week, the Fair Work Ombudsman (FWO) successfully secured over $134,000 in penalties against former operators of a retail outlet and café in Melbourne who underpaid marginalised and disadvantaged workers over various periods in 2016.

Photoplus Australia Pty Ltd was penalised $68,520 and Choi Brothers Pty Ltd which operated a café trading as Bread Kingdom was penalised $55,404 for underpayments described as “very significant” by the Federal Circuit Court. The owner and sole director of both companies was also individually penalised an additional $10,886 for his involvement in record-keeping and pay slip obligations.

Judge Burchardt ruled the record keeping and payslip contraventions were “plainly deliberate” as he imposed the large penalty to “send a clear message” contraventions against vulnerable workers will result in “serious sanctions.”

In addition to failing to pay lawful minimum entitlements under the applicable awards, the owner failed to provide employees with a copy of the Fair Work Information Statement, a minimum requirement under Australia’s National Employment Standards when an employee commences employment.

Employers are reminded the Fair Work Amendment (Protecting Vulnerable Workers) Act 2017, which commenced in September 2017, has improved the protections available to vulnerable workers and increased penalties that can be imposed on businesses for contraventions of workplace laws tenfold.

Whilst the legislation was initially in response to non-compliance in the franchise industry, this case clearly demonstrates the FWO’s vigorous commitment to actively pursuing any employer or individual who contravenes their workplace obligations, with industries including, retail, hospitality and child care being a hotspot.

With the courts demonstrating a willingness to utilise the full extent of the increased penalties available and with employees having access to a number of FWO resources, including the “Record My Hours” App to combat underpayments, professional assistance has never been so important for all employers.

Our team at HR Assured assist businesses in ensuring they are meeting their workplace obligations. In addition to undertaking an initial audit of your business, as a client of HR Assured you will have unlimited 24/7 access to our Telephone Advisory Service team who provide professional advice to clients in a broad range of workplace matters.

Contact us today to learn more about how we can help you and your business ensure compliance.