The owner and operator of the Coffee Club outlet in Geelong’s Westfield shopping centre will have to face court for allegedly underpaying two young workers more than $15,000 and for paying flat rates as low as $15 an hour.
The Fair Work Ombudsman (FWO) is commencing legal action against Edison Peng and his company JMSL Pty Ltd, which owns the Geelong Coffee Club outlet, and alleging that two young employees were underpaid a total of $15,412.
This meant junior hourly rates were underpaid, including casual loadings as well as weekend and public holiday penalty rates that the workers were entitled to under the Restaurant Industry Award 2010.
One of the workers, 19 to 20 years old, was allegedly underpaid $12,910 between May 2016 and August 2017, while the other – aged 20 – was underpaid $2,502 over a period of three months in 2018.
This isn’t the first Coffee Club franchisee to be taken to court by FWO: in 2017, the FWO secured more than $180,000 in penalties against a former Brisbane-based Coffee Club franchisee who threatened to cancel an overseas worker’s 457 skilled worker visa if he did not pay back $18,000 of his wages.
Fair Work inspectors investigated the alleged underpayments after the two workers got in touch with FWO.
During the investigation, Peng and JMSL Pty Ltd also allegedly breached laws by providing false records and payslips to inspectors that exaggerated how much the young workers were paid.
Fair Work Ombudsman Sandra Parker said the undercutting of Award entitlements was “completely unacceptable conduct”.
“Enforcing compliance with workplace laws in the fast food, restaurant and cafe sector continues to be a priority for the Fair Work Ombudsman,” Parker said.
“Employers in this sector are on notice that they must pay all employees according to Australia’s lawful minimum pay rates.”
Peng faces fines of up to $12,600 per contravention and JMSL Pty Ltd up to $63,000 per contravention, and the FWO is seeking court orders to require Peng to register with the fairwork.gov.au My Account portal and complete workplace relations training.
Peng and his company are yet to fully rectify the alleged underpayments.
A directions hearing in Melbourne’s Federal Circuit Court is set for 12 November.
Yahoo Finance has contacted Coffee Club for comment.
Young people and visa holders are often taken advantage of by unscrupulous employers.
FWO inspectors found Endota Spa Sydney deducted pay from 13 workers on 457 visas every fortnight for nearly four years.
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