Sushi operators hit with $380,000+ penalty

04 June, 2019 by
Madeline Woolway

The operators of three Tokyo Sushi outlets in regional New South Wales have been slapped with penalties totalling $383,616.

Kiyoshi Hasegawa will have to hand over $63,936 in penalties for her part in underpaying 31 employees more than $70,000. The employees worked across three outlets in the Newcastle and Central Coast regions.

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Hasegawa & Ye International Pty Ltd and Heiwa International Pty Ltd have also been penalised $150,120 and $169,560 respectively. Both companies are owned by Hasegawa and her family. Hasegawa and the companies admitted to the underpayments, which occurred in 2016, in the Federal Circuit Court.

During a six-month period 16 employees at two Tokyo Sushi outlets at the Erina Fair Shopping Centre on the Central Coast were underpaied a total of $48,318. A further 15 employees who worked at the Tokyo Sushi outlet at Fletcher, Newcastle, were underpaid a total of $22,567 during an eight-month period.

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A number of the underpaid employees were visa holders and eight were juniors (one 17-year-old worker on the Central Coast and seven workers aged between 16 and 20 at the Newcastle outlet).

The workers were paid hourly rates ranging between $9 and $19 on weekdays at the Newcastle outlets and between $10 and $19 at the Central Coast store, as well as an additional 25 per cent on Saturdays and an additional 50 per cent on Sundays.

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The rates, which did not comply with Fast Food Industry Award 2010, lead to underpayment of minimum weekday rates, casual loadings and penalty rates for weekend and public holiday work.

Laws relating to superannuation entitlements and record-keeping were also broken by both companies, while Heiwa International also breached minimum engagement period obligations.

The contraventions were described as “serious” by Judge Philip Dowdy, who said there was “no excuse” for the conduct.

“The simple fact of the matter is that persons who engage in business activities which necessitate the employment of staff are under a strict obligation to pay their staff the just entitlements of the staff in accordance with law, whether the relevant employer is a major corporation or, as here, a family business,” Judge Dowdy said.

Most of the underpayments have been rectified but the Court has ordered Ms Hasegawa, Hasegawa & Ye International Pty Ltd and Heiwa International Pty Ltd to back-pay the final outstanding amounts to employees within 28 days.

As of July 2017, the Tokyo Sushi — The Corner Store at Erina Fair Shopping Centre has not been owned or operated by Hasegawa and Hasegawa & Ye International Pty Ltd.

The underpayments were discovered by Fair Work Ombudsman inspectors during audits of more than 40 sushi outlets across Canberra, South-East Queensland, the Hunter, Central Coast, Coffs Harbour and North Coast regions in NSW.

“Inspectors will continue to conduct targeted audits across the fast food, restaurant and café sector and we will hold employers accountable if they are not meeting their lawful obligations,” Fair Work Ombudsman Sandra Parker said.

Hospitality industry top priority for regulator

Restaurants, cafes and fast food outlets remain at the top of the target list for the Fair Work Ombudsman heading into the 2019/20 financial year.

Parker announced the agency’s priority industries and issues at the 2019 Annual National Policy Influence Reform Conference in Canberra, outlining a stronger approach to enforcement.

The priorities, which also include franchisors, will direct the regulator’s compliance work and enforcement outcomes.

Vulnerable workers will continue to be a priority too, according to Parker.

“We will use our new powers and publicly name employers who break the law to get the message out that it is not acceptable to underpay workers or deprive them of their entitlements. Employers who do this will get caught,” Parker said.

“So if you are in one of our priority industries, operate a franchise system or employ large numbers of migrant workers, you should expect to hear from us.”

Image: Pille-Riin Priske