HAN’S Cafe franchisees in Rockingham and Armadale have been fined for underpaying workers.
The Fair Work Ombudsman secured $80,000 in penalties against the franchisees of two Han’s Cafe outlets after staff were underpaid almost $100,000.
The penalties were the result of the Fair Work Ombudsman taking legal actions in response to 27 staff at the Han’s outlet in Armadale being underpaid $67,161 and 22 staff at the Han’s outlet in Rockingham being underpaid $27,920.
Phua and Foo Pty Ltd has been penalised $35,000 for underpayments at the Armadale outlet and Tac Pham Pty Ltd has been penalised $37,500 for underpayments at the Rockingham outlet.
In addition, the general manager of the Rockingham outlet Cuc Thi Thu Pham was penalised $7500 for her role in the non-compliance at that outlet.
The penalties have been imposed in the Federal Court in Perth.
Fair Work Ombudsman inspectors audited the Armadale outlet during a proactive auditing campaign in Perth’s south.
A tip-off during the campaign led inspectors to audit the Rockingham outlet.
The underpayments at the two outlets occurred at various times between December 2014 and December 2015.
The underpaid employees at the Rockingham outlet included nine juniors aged between 17 and 19 and seven overseas workers, mostly international students from Vietnam.
Underpaid employees at the Armadale outlet included one junior aged 18-19.
Most of the underpaid workers were employed as kitchen attendants, cooks and food-and-beverage attendants.
Staff at both outlets were paid flat rates which were below the minimums in the Restaurant Industry Award 2010.
Employees were underpaid minimum rates for ordinary hours, penalty rates and other entitlements.
Pay slip laws were also contravened at the Rockingham outlet.
All workers were back-paid in full last year.
Justice Anthony Nicholas Siopis found that the underpayments at the Armadale outlet were the product of a deliberate decision by Phua and Foo Pty Ltd, through store part-owner Tye Kin ‘Philip’ Phua, “to pay a flat hourly rate, notwithstanding that he was conscious of the fact that weekend penalty rates existed and would have imposed a higher cost for labour for his business”.
Justice Siopis said the underpaid employees at the Armadale outlet “were low paid employees and the underpayment would have had a more profound impact upon persons whose base rate of pay was low”.
The underpayments at the Rockingham outlet occurred despite the Fair Work Ombudsman having advised Mrs Pham and Tac Pham Pty Ltd in 2013 about minimum lawful Award wage rates after receiving an underpayment allegation from a worker.
Justice Siopis found that Mrs Pham’s lack of English fluency and alleged lack of comprehension of the advice provided by the Fair Work Ombudsman were not satisfactory explanations for the underpayments.
“It was also open to (Mrs Pham), if she was not able fully to understand the content or gravamen of her dealings with the FWO in 2013, to have obtained professional advice on this issue,” he said.
Justice Siopis found that Mrs Pham “simply chose to disregard her dealings with the FWO in November 2013 and continued to operate the defective wages payment system which she had inherited, recklessly indifferent as to whether she was, thereby, compliant with the Restaurant Award conditions.”
Justice Siopis said the penalties imposed should deter other operators in the restaurant and café industry from similar conduct.
“It is important for employers in the restaurant/cafe industry to appreciate that serious consequences will attend a failure to meet Restaurant Award conditions,” he said.
Justice Siopis also ordered Tac Pham and Phua and Foo Pty Ltd to commission workplace relations training for managerial staff.