A federal circuit court judge has thrown the book at a business operator for “heinous” conduct towards its employees, and issued fines worth more than $284,000.
The operators of Gold Coast restaurant Samurais Paradise and former operators of the nearby Japanese Curry House Kawaii restaurant, Shigeo Ishiyama and his company Samurais Paradise Pty Ltd, were fined $38,000 and $246,400 respectively, after being found guilty of cooking the books on staff wages.
Judge Salvatore Vasta found that not only were nine foreign workers paid as little as $8 an hour, but Mr Ishiyama deliberately falsified records to cover up the underpayments.
The mostly Japanese employees, aged in their 20s and on 417 working holiday visas, were collectively underpaid by $59,080 in just four months in 2015.
After an earlier investigation by the Fair Work Ombudsman (FWO), Mr Ishiyama was given instructions on meeting his obligations as an employer and made back-payments to affected employees.
However in a follow up audit, FWO inspectors uncovered falsified records designed to conceal ongoing employee payments of between $8 and $11 an hour for all hours worked – well below the minimum hourly rates of $18.47, not to mention the substantial penalty rates for weekend and public holiday work.
“The aggravating circumstances of the falsifying of records and the provision on two occasions of false records show that this case is in a very serious bracket,” Judge Vasta said.
“The making of false records, as I have already said, is a most heinous offence. The respondent was warned not to make false records, but did anyway and those false records gave quite an improper picture of what was happening.”
Judge Vasta also noted the scale of the deception, had it been allowed to continue, would have amounted to major financial losses for the workers and provided a significant unfair advantage against legitimate restaurant operators in the area.
“If one extrapolated that to the course of a year, it would mean that a business such as the ones being run by the First Respondent and Second Respondent, would have a saving to them of about $180,000,” Judge Vasta said.
“When one is looking at a small business, the temptation is great that such a saving to them would give them a competitive edge of all the other businesses in their area… While one applauds persons trying to stay competitive, this cannot be done at the expense of employees and in breach of the FW Act.”
The workers have now had their wages back-paid in full, as well as more than $8,000 in outstanding superannuation contributions.
The case comes just as the FWO urged business operators to avoid copping the recently doubled penalties for inaccurate record-keeping.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
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