The penalties have been imposed on Brisbane man Saandeep Chokhani and his wife, who jointly owned and ran the Coffee Club franchise earlier at the Nundah Village Shopping Centre in Brisbane.
The Court found that the couple threatened to cancel the Indian-origin employee's 457 visa if he failed to pay the demanded $18,000 of his wages.
According to the Fairwork Ombudsman, the Federal Circuit Court has penalized Chokhani with $30,000 and the company Gaura Nitai Pty Ltd, which he and his wife are the directors of, has been fined a further $150,900.
The worker, an Indian national in his late 20s was sponsored by Gaura Nitai to work as a cook at the Nundah Coffee Club outlet on a 457 visa.
In his penalty judgment, Judge Michael Jarrett said, “The exploitation of workers from other countries who are inspired to live and work in Australia with the hope of achieving permanent residency needs to be discouraged, in the strongest of terms whenever it is apparent that it has occurred. This is one of those cases.”
Fairwork Ombudsman's statement say that the worker was promised an annual salary of $53,900 at the time of his recruitment. However, they failed to pay him for a four-month period from July-to-November 2014 and a one-month period in February-March 2015. He was then paid $19,334 by electronic transfer on 22 April 2015.
Judge Jarrett found that Mr Chokhani then asked the worker to withdraw $18,000 in cash and repay it to him. The worker was told that Chokhani would take steps to cancel his 457 visa if he failed to pay the demanded amount.
The worker then withdrew $18,000 in cash and repaid it to Mr Chokhani on the same day.
“(The worker) was in a bind. He could not leave his employment because if he did so he would breach a condition of his visa and his ability to remain in Australia would be seriously compromised. He was effectively working for nothing,” Judge said.
The worker was terminated without notice in November 2015 after which he lodged a request for assistance with the Fair Work Ombudsman.
The investigation by the Fair Work inspectors found that due to the the unlawful cash-back payment, the worker had been underpaid his minimum hourly rates, casual loading, annual leave entitlements, overtime rates, payment in lieu of notice of termination and penalty rates for weekend and public holiday work.
The worker was short-changed a total of $23,546 between September, 2013 and November, 2015 following the unlawful cash-back payment and the underpayment of contractual entitlements.
The worker was back-paid in full earlier this year.
Reports say, the worker told the Court that the exploitation had left him with credit card debt and debt to his family and friends from whom he had borrowed money.
Judge Jarrett described the demand of cash-back payment to the worker as “especially egregious”, saying it was “an inappropriate and grotesque exploitation of the power imbalance that existed between (Chokhani) and (the worker)”.
“The respondents’ conduct was deliberately exploitative of (the worker’s) position being, as he was, dependent upon (Gaura Nitai’s) ongoing sponsorship so as not to jeopardise his 457 visa”, Judge said.
Mentioning that the fines imposed send a message about the seriousness of exploiting the vulnerability of visa holders, Fairwork Ombudsman's Natalie James said, “We will do everything within our power to pursue any employer who thinks they can exploit the power imbalance they have over migrant workers they employ. Any unscrupulous employer tempted to engage in this sort of conduct should think again because there are serious consequences for this type of behaviour.”
Chokhani and Gaura Nitai stopped the operation of the Nundah Coffee Club outlet in May 2017.
