Company accused of underpaying more than 50 employees

The owner is facing Court for alleged underpayments totaling more than $70,000

Company accused of underpaying more than 50 employees

More than 50 employees have allegedly been underpaid over $70,000 at a café in Melbourne’s Crown Casino.

The Fair Work Ombudsman has begun legal action in the Federal Circuit Court against Ital One Holdings Pty Ltd, which operates cafes and restaurants in Melbourne, including Café Baci in the Crown precinct.

Len Di Pietro, the company’s sole director, is also facing Court.

The FWO alleges 54 employees at Café Baci were paid flat rates as low as $16 for all hours worked, leading to a total of $73,347 in underpayments. The staff were employed as waiters, kitchen hands, chefs and in other roles and 25 of them were visa holders.

It is alleged the flat hourly rates (which varied from $16 to $48) led to underpayment of various entitlements, including the minimum wage rates, overtime rates, casual loadings and penalty rates for weekend, public holiday, late night and early morning work employees were entitled to under the Restaurant Industry Award 2010.

The highest alleged individual underpayment during this period is $4807 of a 417 visa-holder who was allegedly paid a flat rate of $17.18 but was entitled to an ordinary casual hourly rate of up to $23.09, weekend rates of up to $27.71 and public holiday rates of up to $46.18.    

The alleged underpayments of all workers have now been almost fully rectified.

The FWO discovered most of the alleged underpayments when it conducted a proactive audit of Café Baci in 2015.

It is alleged the underpayments occurred despite the FWO having previously put Di Pietro and Ital One Holdings on notice to comply with their obligations to pay minimum wage and penalty rates a number of times in the context of investigating 12 previous underpayment allegations from workers dating back to 2007.

The FWO also provided assistance in 2014 to three former Café Baci workers who took their own actions in the small claims division of the Federal Circuit Court, which resulted in Ital One Holdings being ordered to back-pay the three workers a total of more than $32,000.

Fair Work Ombudsman Natalie James said a key factor in the decision to commence legal action was that alleged underpayments of vulnerable workers had occurred despite the education provided to Di Pietro and Ital One Holdings.  

“It is simply unacceptable for an employer to continue to underpay workers after being directly educated on their obligations to meet minimum employee pay rates and having been ordered by a Court to back-pay workers,” said James.

“We also treat cases involving underpayment of overseas workers particularly seriously because we are conscious that they can be vulnerable due to a lack of awareness of their entitlements, language barriers and a reluctance to complain.”

In the 2015-16 financial year, 38 of the FWO’s 50 litigations (76%) involved a visa holder, and more than $3 million was recovered for all visa-holders. Ital One Holdings faces penalties of up to $54,000 per contravention and Di Pietro faces penalties of up to $10,800 per contravention.

The FWO is also seeking Court orders for Ital One Holdings to commission an audit of its compliance with workplace laws and for Di Pietro and other relevant managerial staff to undertake workplace relations training.

An injunction restraining the company and Di Pietro from contravening the Restaurant Industry Award 2010 in future is also being sought. If the injunction is granted, each could face contempt of court proceedings for any further contraventions proven in court.

 

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