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Boutique retailers slapped with $134k penalties

Adam Zuchetti
Adam Zuchetti
12 June 2018 1 minute readShare
Money to burn

Two city businesses — a café and a retail outlet — have been hit with collective penalties of more than $134,000 after their owner was found to have taken advantage of “marginalised and disadvantaged” employees.

The Fair Work Ombudsman (FWO) said that Photoplus Australia, which formerly operated a photography and mobile phone accessories store under the name Photoplus, and Choi Brothers, the former operator of the Bread Kingdom café, were taken to court for various employee wage underpayments.

Both businesses in Melbourne’s CBD were owned and operated by Seung-Geun Choi.

Two employees at Photoplus, and a third who worked at both businesses, were found to have been underpaid to the tune of $44,950 in 2016, with poor record-keeping and a failure to provide pay slips compounding the problem.

More than half of that amount — or $25,452 — was denied to just one of the workers.

FWO found that the workers had been paid flat rates of between $11 and $14 for all hours worked, despite the international students and holiday visa holders being entitled to award wages of up to $19 per hour, plus penalty rates and casual loading.

While the three former workers have since been repaid in full, Judge Philip Burchardt of the Federal Circuit Court threw the book at Mr Choi, describing the situation as “very significant”, particularly in light of previous warnings of non-compliance issued in 2013.

“[E]vents of 2013 should have put them on notice of the minimum obligations and caused the respondents to take steps to check and comply with them,” said the judge.

In a bid to “send a clear message” that such breaches of the law will not go unpunished, Judge Burchardt slapped penalties of $55,404 on Choi Brothers and $68,520 on Photoplus Australia.

Mr Choi was also personally fined $19,896, taking the total penalties to $134,820.

“These operators were underpaying workers in not one but two Melbourne businesses,” Ombudsman Natalie James said in response to the verdict.

“If you are so confident as to involve yourself in multiple ventures, you should be capable of checking the rules that apply to employing workers in those businesses and applying them, not demonstrating the sort of reckless disregard seen here.”

She added: “It is not a legitimate or lawful approach to pass the burden of businesses’ financial circumstances on to marginalised and disadvantaged workers.”

Boutique retailers slapped with $134k penalties
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Adam Zuchetti
Adam Zuchetti

Adam Zuchetti is the former editor of MyBusiness and a senior freelance media professional, specialising in the fields of business, personal finance and property. In 2020, he also embarked on his own business journey – inspired in part by the entrepreneurs and founders he had met through his journalistic work – with the launch of customised pet gifting and subscription service Paws N’ All.

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