Cafe required visa holder to pay back wages: Fair Work

26 July, 2016 by
Danielle Bowling

An overseas worker employed as a cook on the Gold Coast was allegedly required to pay back more than $21,000 of her wages to her employer in an exploitative cash-back scheme.

The Fair Work Ombudsman claims the Korean national felt “compelled” to oblige, as she was concerned her employer would cease to sponsor her 457 visa if she didn’t.

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The visa-holder was engaged on an annual salary of $49,330, but was allegedly required to pay a portion of her wages back to her employer in cash every week. She allegedly made cash-back payments of between $111 and $715 a week, depending on the hours she worked. The result was that she was allegedly paid between $15 and $18.50 an hour and resulting in a total underpayment of $29,587 over 19 months.

The Fair Work Ombudsman alleges the employee was short-changed her minimum wages, weekend and public holiday penalty rates and overtime she was entitled to under the Vehicle Manufacturing, Repair, Services and Retail Award.

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The employee is one of 59 workers across two Expresso Carwash Caf sites at Southport and Labrador allegedly underpaid a total of $147,362.

Facing legal action in the Federal Circuit Court is the company that operates them, Ausinko Pty Ltd and owner-director Richard Sang Kyun Kim. Also facing legal proceedings is Ausinko manager Chao “Tommy” Liu.

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The company was audited after the Fair Work Ombudsman received 12 requests for assistance from employees from 2011.

The Fair Work Ombudsman will allege that Ausinko operated the cash-back scheme to try to make it appear that the worker was being paid correctly.

Ausinko allegedly provided Fair Work inspectors with false or misleading employment records that did not show the cash-back payments.  

As a result of a wider audit of the two sites, the Fair Work Ombudsman allegedly uncovered the underpayment of 58 other employees, aged between 20 and 31 and including overseas workers in Australia on the 417 working holiday visa.

They were allegedly short-changed a total of $117,775.

Ausinko has committed to back-paying the workers in-full and has already rectified more than half of the alleged underpayments.

However, Fair Work Ombudsman Natalie James said the involvement of vulnerable workers and the fact that Ausinko had previously been put on notice of the need to pay employees their lawful minimum entitlements were significant factors in the decision to commence legal action.

Ausinko Pty Ltd faces penalties of up to $51,000 per contravention, while Kim and Liu face maximum penalties of up to $10,200 per contravention

A directions hearing is scheduled for the Federal Circuit Court in Brisbane on 1 August.