The Judge found that the business had “systematically exploited” employees by implementing “a business model that relied upon a deliberate disregard of the employees’ workplace entitlements”.
In the highest ever court imposed penalty achieved by the Fair Work Ombudsman, a penalty of $408,348 has been imposed against a Brisbane 7-Eleven operator for “systematically exploiting” its workers.
The penalty is the result of a Fair Work Ombudsman investigation that found 12 employees were short-changed over $82,000 between September 2013 and September 2014.
Brisbane businessman Sheng-Chieh Lo was penalised $68,058 and his company, Mai Pty Ltd, a further $340,290 for the infringements.
Lo’s Brisbane store was one of 20 7-Eleven outlets targeted by Fair Work inspectors for surprise night-time visits as part of a tri-State operation in September 2014.
He paid employees flat rates, as low as $13 an hour, and had tried to conceal the underpayments by creating false records and making entries into the 7-Eleven head office payroll system.
Judge Michael Jarrett described it as “a sophisticated system of data manipulation and false record keeping” and the extent of the deception only came to light because of the persistence of Fair Work inspectors.
Judge Jarrett said the “facts reveal a contemptuous disregard of Australian workplace laws”.
“Mr Lo’s contempt is demonstrated by his persistent attempts to deceive the Fair Work inspectors investigating the relevant complaints and his insistence, undertaken in a secretive way, that any amounts he paid to the relevant employees to make good (Mai Pty Ltd’s) defaults should be immediately paid back to him,” he said.
Most of the employees received just over half what they were entitled to, with individual underpayments ranging from $1673 to $21,966.
Judge Jarrett found there had “been no suitable credible expression of regret”.
“… Lo continues to justify his actions without accepting responsibility for them,” he said.
Judge Jarrett said the penalties “will assist in ensuring other employers in the retail sector, and particularly within 7-Eleven, are compliant with their obligations”.
“Employers should be in no doubt that they have a positive duty to ensure that they comply with the obligations which they owe to their employees under the law,” he said.
In addition to the penalties and back-pay Order, Judge Jarrett imposed an injunction restraining Lo and his company from underpaying workers and from seeking or accepting any back-payment of wages from current or future employees.
Lo’s company was also Ordered to display an in-store notice informing employees of entitlements and to undertake an audit of its compliance with workplace laws and report the results to the Fair Work Ombudsman.
Employers and employees seeking assistance can visit www.fairwork.gov.au or contact the Fair Work Infoline on 13 13 94.