A Coffee Club Café franchisee in Brisbane is facing court for allegedly making an overseas worker repay $18,000 of his wages by threatening to cancel his 457 visa if he refused.
Saandeep Chokhani and his wife who own and run the Coffee Club franchise and their company Gaura Nitai Pty Ltd, are facing legal action after Fair Work investigators found they underpaid an Indian cook who was sponsored to work on a 457 visa.
According to the Fair Work Ombudsman (FWO) , the worker was promised an annual salary of $53,900 but was paid significantly less and had to endure long periods without receiving any wages.
It is also alleged that Mr Chokhani told the Indian worker to withdraw $18,000 and repay in cash or his 457 visa would be cancelled.
The Fair Work Ombudsman claims the worker was underpaid his minimum hourly rates and loadings to the tune of $23,546 from September 2014 to November 2015, as a result of the unlawful cashback payment before he was terminated without notice in November 2015.
The worker has now been back-paid in full.
FWO Natalie James said the franchise owners cooperated with the investigators by providing them with the documents and records.
Mr Chokhani faces maximum penalties of up to $10,800 per contravention and his company Gaura Nitai Pty Ltd faces penalties of up to $54,000 per contravention.
A penalty hearing is scheduled for the Federal Circuit Court in Brisbane on 2 June.
"It is hard to see a legitimate reason why an employer would require employees to be regularly paying back significant parts of their wage, and I am concerned that cashback schemes are being utilised by unscrupulous operators in an attempt to get around record keeping laws and disguise serious underpayment of wages,” Ms James said.
“We welcome the Government’s commitment to strengthen laws to explicitly cover cash back arrangements.”
Ms James says workers who find themselves in this situation should document what is going on by making their own records and contact the Fair Work Ombudsman for free advice and assistance.
“I want to make it clear that the lawful obligations to pay minimum wage rates, keep appropriate employment records and issue pay slips apply to all employers in Australia and they are not negotiable.”
Employers and employees can contact the Fair Work Infoline on 13 13 94 to seek assistance.
