A former 7-Eleven manager, in Australia on a student visa, is facing court for allegedly forcing employees to return portions of their wages as “cashbacks” in a bizarre example of wage underpayment.
Taiwan national Ai Ling “Irene” Lin, a student visa holder, was the former manager of a Melbourne CBD store, operated by a company called Xia Jing Qi.
7-Eleven reportedly introduced a sophisticated time-keeping system in 2016 following its infamous wage underpayment scandal.
This system used biometric input from workers in the form of their fingerprints to clock in and out, ensuring accurate time sheets were recorded and wages paid correctly.
In launching legal action against Ms Lin and Xia Jing Qi, the Fair Work Ombudsman alleged they sought to circumvent this system by insisting three Chinese workers – also on student visas – return some of their wages by way of a supposed cashback scheme. The workers were allegedly told to deposit this cash into an in-store safe box or directly into a bank account belonging to Ms Lin.
The move essentially meant the workers were being paid hourly rates of between $8.53 and $26.52, well below award rates with casual loading of between $24.30 and $48.60. In total, Ms Lin and Xia Jing Qi are alleged to have accrued $6,674.
All three workers have since been back-paid.
Fair Work Ombudsman Natalie James labelled these so-called cashback schemes a serious form exploitation.
“We encourage anyone with information about cashback schemes to come forward and assist us in our investigations,” said Ms James.
A second law suit has been filed against Xia Jing Qi for a separate case of wage underpayment, in which another overseas worker was allegedly paid as little as $3.98 an hour.
Ms James noted that more than $1 million in penalties have been issued against 7-Eleven franchisees for wage underpayment, with this being the 11th case prosecuted.
If the ombudsman is successful in both of these latest cases, that figure will likely rise sharply, given that each breach of workplace laws attracts penalties of up to $10,800 for individuals and up to $54,000 for companies.
“The lawful obligations to pay minimum wage rates and keep accurate employment records apply to all employers in Australia – in relation to all employees – and are not negotiable,” Ms James said.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.