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Wine bar fined $31k for wage underpayment

Adam Zuchetti
Adam Zuchetti
24 August 2018 1 minute readShare
Red card, penalty

A city wine bar operator has been hit with penalties of more than $31,000 from the Fair Work Ombudsman for wage underpayment, in the latest instance of action targeting the hospitality industry.

Meatball and Wine Bar, which has three outlets in Melbourne, admitted in the Federal Circuit Court that it had underpaid 26 workers by $14,149 in just three months between 4 July and 2 October in 2016.

These underpayments arose after the wait staff and kitchen hands were paid flat rates that fell below the relevant industry award, and did not account for penalty rates and casual loading.

The Fair Work Ombudsman (FWO) implied that these workers were vulnerable and had been taken advantage of by their employer, given that 11 had either student or working visas, and 22 of the 26 were in their 20s.

It was also put to the court that Meatball and Wine Bar had also failed to retain the required employee records.

Despite the business having repaid all the workers by June 2017, the FWO launched legal action against the business, with the court handing down a $31,320 penalty for the various breaches.

“Employers must ensure they comply with their lawful obligation to pay employees the minimum pay rates they are entitled to as Fair Work inspectors may arrive to check records anytime,” Ombudsman Sandra Parker said.

“The Fair Work Ombudsman will continue to target industries where we are concerned about the underpayment of overseas workers, as they can be particularly vulnerable and reluctant to request our assistance.”

Ms Parker’s reference to targeting particular industries refers to previous criticism of the hospitality sector as one of the most notorious for compliance breaches.

“It is deplorable that nearly one-third of the most serious cases that end up in court involve this one sector,” former Fair Work Ombudsman Natalie James said earlier this year.

But employers and accountants have hit back at the FWO and the Fair Work Commission, claiming that wage underpayment is generally not intentional but a symptom of the complexity of workplace laws.

Wine bar fined $31k for wage underpayment
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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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