Clothing retailer faces tougher Fair Work penalties

Published September 16, 2019 (last updated July 17, 2020) -

Underpayment has reared its head again, with a children’s clothing retailer set to face Federal Court accused of underpaying for migrant workers $140,000 over three years.

The Ombudsman claims the business paid four migrant workers, who spoke little English, as little as $10 an hour, resulting in between $16,007 and $47,285 in stolen wages per worker.

The four employees, who were employed as retail workers in the stores, were women in their 40s who speak limited English. Fair Work inspectors discovered the alleged underpayment of the workers, when investigating a request for assistance from one of them.

In a statement, Fair Work Ombudsman Sandra Parker said: “Employers are on notice that the Fair Work Ombudsman is making full use of the Protecting Vulnerable Workers laws to ensure that any individuals or companies who commit serious contraventions are held to account.”

Penalties for breaches of this kind can be $630,000 for a company and $126,000 for an individual.

The company and one director are also accused of obstructing the investigation by ordering the deletion of timesheets, and by providing false records to inspectors.

The development is the latest in a trend of underpayment cases pursued by the FWO that exceed $100,000. The breaches could be a sign that regulators and legislators are grappling with widespread non-compliance with workplace laws across various sectors.

The Ombudsman is seeking an independent audit, the display of workplace notices and the completion of education courses are also being sought. In addition, the FWO seek a backpay order, which implies the company has yet to repay the stolen wages.

According to the Fair Work Ombudsman, migrant workers and visa holders continue to be one of the most vulnerable worker cohorts, and are continually over-represented in disputes. While migrant workers make up 6% of the Australian workforce, they account for 20% of all formal disputes completed by the FWO in 2017-18.

A directions hearing is listed for the Federal Court in Sydney on 14 October 2019.

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