Restaurant Workers Allegedly Told To ‘Buy’ Leave

Published September 05, 2019 (last updated July 22, 2020) -

A Canberra restaurant is facing allegations of migrant worker exploitation, with employees claiming they were told to purchase sick and holiday leave.

The former employees from the Indian restaurant have made serious allegations of exploitation and wage theft with the Fair Work Ombudsman (FWO).

The former manager claims the workers were told their visas would be cancelled if they didn’t ‘purchase’ their leave.

Workers were allegedly told the money was meant to cover tax and replacement staff.

“We had no choice. They controlled us,” the former manager said.

Former cook said she was fired for poor performance after submitting a medical certificate and has since filed a complaint against the restaurant with the ACT Civil and Administrative Tribunal.

The hospitality union, United Voice, is planning a protest outside the Lonsdale Street restaurant today.

United Voice secretary Lyndal Ryan said it was clear worker exploitation was happening “right under our noses” in the ACT. “Perhaps the greatest irony of the situation is that the restaurant is located literally next door to the Department of Home Affairs,” she said.

However, Senior Workplace Adviser at Employsure, Michael Wilkinson has defended the industry that has been at the centre of the spotlight recently saying: “Most employers want to do the right thing. Most problems arise because of misunderstandings about the application of the law, rather than a blatant disregard for it.”

“It’s clear there’s a lack of understanding of and compliance with workplace laws throughout hospitality and the food sector.”

“Hospitality and restaurant employers are under a lot of pressure. They’re always on demand and trying to keep their head above water running their business. So, it’s hard to keep across the employment guidelines, legislation, and requirements that they need to be across.”

“Almost half of Australia’s hospitality workers are aged between 15 and 24 years – a demographic that the FWO considers vulnerable” says Wilkinson.

Record keeping and pay entitlements are common issues particularly for the hospitality and restaurant industry where shifts and rosters can be irregular, and Awards can vary.

“We hear a lot from hospitality employers about Award classification and penalty rates – particularly now because of the recent penalty rate changes.”

Mr Wilkinson says, 30 per cent of calls that come through the Employsure Advice Line are from the hospitality sector; relating to basic employee entitlements, adding, “it is clearly an area where they struggle.”

“In the past decade, wages are up by almost 36 per cent. Rent, historically increases 3-5 per cent yearly, but now rent in popular districts are up by an average of 35-60 per cent per year. Food and beverage costs continue to rise. Competition is fierce with app-based food delivery entrants. On top of this, all the other costs of doing business, like insurance, advertising, internet connection and technology solutions also go up each year.

“Yet, in the same period, CPI is up only 21 per cent and the price of a cup of coffee has barely risen.

“A decade ago, restaurants enjoyed an average of 15 per cent profit margins. Now they are lucky to make between 2-5 per cent, with many just breaking even or worse, forced to close.

“It’s a tough time for the hospitality and food sector around the country,” he said.

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