One business has been found to have underpaid employees by more than $30,000 in just a fortnight, demonstrating the significant financial advantage dodgy operators have over reputable employers.
A raid in Melbourne was conducted jointly by the Fair Work Ombudsman (FWO) and the Department of Immigration and Border Protection in a bid to investigate foreign worker exploitation.
As a result of the raid, FWO is alleging one business owner – who operates two restaurants in the CBD and Box Hill, Victoria – underpaid its workers by $30,995 in the space of just two weeks in June 2016.
In total, 30 employees across the two sites were allegedly paid flat hourly rates of between $10 and $22, despite working up to seven days a week and more than 10 hours per day.
Under the relevant award, some of those employees should have been paid more than $40 an hour.
If found guilty, it will prove to be an expensive exercise for business owner Ye Shao and his companies Nine Dragons and Wynn Sichuan, with each contravention attracting a fine of up to $10,800 for individuals and up to $54,000 for companies.
In-house accountant Yizhu “Jessica” Ding is also being prosecuted for being an accessory to underpayment and for record keeping contraventions.
The pair will appear in the Federal Circuit Court in Melbourne on 28 August 2017.
Some business owners, including hairdressers and café owners, have complained about the difficulty of competing against business operators who are exploiting their workforce – whether they be foreign or local – while paying their own workers appropriately.
Cases such as this, however, will likely bolster support for the government’s abrupt 457 visa changes, announced in April this year, which aim to tighten the types of foreign workers eligible for skilled working visas.
“It is not okay for employers to arbitrarily determine low, flat rates of pay. Minimum wage rates apply to everyone in Australia – including visa-holders – and they are not negotiable,” said acting Fair Work Ombudsman Mark Scully.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.