Australia

'No tolerance': Melbourne cafes ordered to back-pay underpaid workers $25,000

Fair Work targeted hospitality and retail businesses in areas with high populations of students. Source: AAP

A high number of underpaid workers are visa holders, with some on student visas.

Cafe operators in Melbourne have back-paid workers nearly $25,000 and will be under close scrutiny for the next three years.

Cafes in the Melbourne suburbs of Richmond and Brunswick were ordered to pay $24,947 to a total of 26 employees after a Fair Work Ombudsman investigation found the companies each paid unlawfully low flat rates between last year.

Some underpaid workers were visa holders, including from South Korea, Germany, Japan, the UK and India, with some on student visas. Across the cafes, 23 of the 26 underpaid employees were young workers aged 25 or younger.

Shop Counter Display Restaurant Bar Showcase Cafe
To Melbourne cafes have back-paid 26 workers. A number of the employees were visa holders.
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“We have no tolerance for employers who think they can pay unlawfully low flat rates of pay to young or migrant workers, who can often be vulnerable,” Fair Work Ombudsman Sandra Parker told SBS News. 

“These court-enforceable undertakings mean the companies have not only had to pay back the money owed to their employees but will also face ongoing close attention by the FWO."

It comes as surprise audits in regional NSW and Victoria found more than 700 hospitality and retail workers were being underpaid, with more than $330,000 owed in total back pay.

The Fair Work Ombudsman targeted businesses in Albury-Wodonga, Ballarat and Wollongong due to the high percentage of university students and large numbers of anonymous reports. All three regions are home to major tertiary education campuses. 

Almost half of the 489 businesses audited - which included take-away food outlets, cafes, restaurants, pubs, bars, and retail stores - were found to be breaking workplace laws, according to a statement from the Fair Work Ombudsman.

“Like many workers in the hospitality industry, young workers in these regions were potentially vulnerable due to their age, visa status and reliance on local jobs to support themselves,” Ms Parker said.

“Like many workers in the hospitality industry, young workers in these regions were potentially vulnerable due to their age, visa status and reliance on local jobs to support themselves."

Only 69 per cent of businesses audited were found to be paying their employees the correct wage.

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