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Underpayments do not make for good hospitality

UnderpaymentsAugust 6, 2015

Underpayments do not make for good hospitality

A restaurant on Sydney Harbour is on notice over its workplace practices after repeated complaints that they were underpaying their staff.

The latest complaint made against the restaurant came from an Italian backpacker working on a 417 holiday visa. He was allegedly underpaid almost $6,000 whilst working as a kitchen hand last year.

Upon investigation the Fair Work Ombudsman found that the kitchen hand was paid a flat rate of $16.50 an hour in the last six weeks of his employment which is less than the minimum hourly rate under the Restaurant Industry Award 2010. Whilst he was originally paid slightly more than this, his wages were not enough to cover casual loadings and penalty rates.

The restaurant initially argued that they had a flexibility arrangement with the employee where they provided ‘benefits’ in return for the $16.50 flat hourly rate, including discounted staff uniforms, on-the-job training, meals and drinks. However, Fair Work Ombudsman Natalie James says that it was a misguided belief of the restaurant that such benefits could count as meeting workplace obligations.

A Compliance Notice was issued requiring the restaurant to back-pay the former kitchen hand $5,703 and another $386 owed to a former waitress who was also underpaid.

Under the Fair Work Act, employers must comply with Notices issued by Fair Work inspectors unless they have a reasonable excuse, or make a court application to challenge the Notice.

The restaurant has arranged to pay back the money owed to the former employees, however Ms James says that the behaviour of the restaurant means it will continue to be watched closely by the Fair Work Ombudsman.

The Fair Work Ombudsman will also be closely monitoring other Sydney restaurants to ensure that they are meeting their employer obligations.

If you would like to review your current wage rates or check that you are fully abiding by the Fair Work Act, call Employsure today on 1300 651 415.

Sourced from the Fair Work Ombudsman Website

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