Service station operators caught underpaying workers

The operators of a Melbourne service station have been fined more than $92,000 for underpaying two workers as little as $10 an hour.

The console operators at the BP service station on Clyde Road at Berwick were underpaid more than $111,800 between 2008 and 2012. Following legal action by the Fair Work Ombudsman, service station operator, Liquid Fuel, has been fined $79,537 by the Federal Circuit Court. Husband and wife managers, Xin Zhang and Linda Qu, have also each been fined $4504 and a penalty of $3861 imposed against company director, Nian Li, who is Qu’s father.

The workers lodged requests for assistance with the Fair Work Ombudsman after repeated inquiries to their employer about their pay rates were stonewalled. After Fair Work inspectors investigated, Liquid Fuel rectified the underpayments, back paying the workers $58,584 and $53,290 respectively. However, Fair Work Ombudsman, Natalie James, said a decision was made to commence legal action because of the blatant nature of the underpayments and the involvement of vulnerable overseas workers.

The underpaid workers were both aged 28 and were in Australia on a 496 skilled designated area sponsored (provisional) visa and a 485 temporary graduate visa when they started working for Liquid Fuel. They were paid flat rates ranging from $10 to $17 an hour, resulting in underpayment of their minimum hourly rates, casual loading and penalty rates for overtime, weekend and public holiday work.

The employees were entitled to receive up to $27 an hour for some work they performed. One of the workers, who financially supported his wife and daughter, told the court the underpayments made it “very hard to survive” and at times he had to “borrow money just to pay rent at the end of the month”. Record keeping and pay slip laws were also breached.

Judge John O’Sullivan, found the case was a “very serious matter” and that there was a need for penalties to deter the respondents and other employers from similar conduct in future. Judge O’Sullivan also found there was “an absence of genuine contrition or remorse on the part of all of the respondents and only platitudes offered once they had been found out”.

James said the penalties send a clear message that exploitation of minimum wage employees – particularly those from overseas – is serious conduct and that significant consequences apply.

“There are a minority of rogue employers that need to get the message that exploitation of these workers is unlawful and unacceptable conduct.”

James said it was also of concern that separate to the legal action, Liquid Fuel had reimbursed $113,000 to six other employees who had been underpaid between 2007 and 2013.

Jeff Rogut, CEO of the Australasian Association of Convenience Stores (AACS), said there needs to be an improvement in compliance within the industry.

“As the new year approaches it is critical that all operators in our industry step up, and ensure that their businesses develop an ongoing culture of compliance. It is totally unacceptable to those who work in our industry to read week after week articles about operators that have not done the right thing by their employees, either alleged or proven,” Rogut said.

“We should be setting the high benchmark for others to follow, rather than being put up as examples of poor practice. A culture of compliance, rather than avoidance, will be critical to future success.”

Formal allegations of non-compliance to the Fair Work Ombudsman from overseas workers have increased steadily in recent years to more than 2100 last financial year. Allegations received from overseas workers were highest in Queensland (28 per cent); NSW (25 per cent); and Victoria (22 per cent). A total of $1.6 million was recovered for visa-holders in 2014-15, up from $1.1 million the previous financial year.

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