A former 7-Eleven operator has been fined $168,000 for the underpayment of workers and falsifying records.
The order was imposed by the Federal Circuit Court as the result of litigation by the Fair Work Ombudsman.
Former operator Jim Chien-Ching Chang from Brisbane admitted that he had underpaid eight staff members to a total of $19,937.
Mr Chang was ordered to pay $28,000 and his company, JS Top Pty Ltd, to pay $140,000.
Mr Chang admitted that his company paid staff hourly rates as low as $13 per hour, a significant underpayment of the minimum hourly rate of $17 per hour for adults at the time.
It was found that Mr Chang also made false and misleading entries into the payroll system and falsified records for the Fair Work Ombudsman.
Judge Michael Jarrett said Mr Chang knew the correct Award that applied to his staff but he: “… established a business model that relied upon a deliberate disregard of the employees’ workplace entitlements and a course of conduct designed to conceal that deliberate disregard”.
Judge Jarrett found that the company’s profits had been enhanced by the underpayments.
All underpayments by Mr Chang and his company have since been rectified.
Fair Work Ombudsman Natalie James said penalties imposed by the courts send a message that exploiting workers is not something that will be tolerated.
“Businesses should be in no doubt that 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,” she said.
“The deliberate nature of the underpayments and the lengths that Mr Chang went to in order to hide his conduct from us and from the 7-Eleven head office is of grave concern. Mr Chang was fully aware of his lawful obligations and chose to manipulate the system in order to undercut the entitlements of vulnerable workers.
“We are pleased that the Court has seen fit to penalise such blatant conduct and hope that this serves as a warning that such behaviour will be penalised,” Ms James said.
Last year, 7-Eleven entered into a Proactive Compliance Deed that outlined a range of measures designed to ensure all staff workers receive lawful entitlements.
Ms James said the deed would help to prevent unlawful practices and increase accountability across the franchise network.
“The measures in this deed are the most robust and comprehensive that any franchise brand has in place in Australia,” she said.