National advertising company OHMedia Melbourne and its director have been penalised a total of $100,000 after failing to pay dozens of workers.
The fines and back-pay order, imposed in the Federal Circuit Court in Brisbane, are the result of an investigation and legal action by the Fair Work Ombudsman.
The business has been fined $85,000 and company director and part-owner Wen Zhou, also of Melbourne, a further $15,000. The company has also been ordered to fully rectify almost $60,000 it short-changed its employees.
Legal action was launched against the company after staff across Sydney, Melbourne, Brisbane and Adelaide were not paid any wages for work they performed.
It underpaid 45 casual employees a total of $59,145 in less than one month, in March/April, 2011. Complaints by employees to the Fair Work Ombudsman prompted a detailed investigation, which revealed the extent of the alleged underpayments.
The employees worked at stalls outside supermarkets promoting prepaid SIM cards and top-up vouchers supplied by global telco Lycamobile, which had contracted OHMedia Melbourne to promote its products.
Most of the employees were overseas workers who were in Australia on student and working holiday visas. Nine of the employees were aged under 21.
Judge Michael Jarrett found that OHMedia Melbourne had made no attempt to seek advice about applicable minimum pay rates and the contraventions were “at the very least reckless”.
Further, Judge Jarrett said OHMedia Melbourne and Zhou had shown no genuine remorse and there was a need to impose a penalty which “serves as a warning to others”.
“Employers should understand very clearly that employees, whether within a vulnerable class or otherwise, are not available for exploitation and are entitled to all of the protections offered by the Fair Work Act,” he said.
A total of 37 of the employees were paid nothing for work they performed, with the others paid only a fraction of what they were entitled to. More than $48,000 of the underpayment relates to 34 employees who were based in Brisbane - including seven aged between 18 and 21 - who individually worked up to 133 hours for no wages.
The other employees were located across Melbourne (five employees), Adelaide (four) and Sydney (two).
Judge Jarrett also found that the failure to keep records was significant. “The failure to keep accurate records undermines the Fair Work Ombudsman’s ability to investigate and ensure compliance with minimum standards,” he said.
Lycamobile Pty Ltd was fined $59,400 in court in 2013 for underpaying 13 staff in Brisbane and Adelaide by $28,000, including a number of overseas workers employed to promote and sell pre-paid mobile phone SIM cards and top-up vouchers.
Fair Work Ombudsman Natalie James said the court’s decision should serve as a reminder to employers that failing to pay employees their basic entitlements is a serious matter.
“Successful litigations such as this also benefit employers who are complying with workplace laws, because it helps them to compete on a level playing field,” she said.
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