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Cafe Owners In Court For Failing To Back Pay Underpaid Workers

Cafe owners in court for failing to back pay underpaid workers

The former owners of a cafe-restaurant located in Adelaide’s CBD are facing court after allegedly failing to back pay four underpaid workers.

The business was issued with a Compliance Notice ordering it to rectify underpayments to four workers totalling $16,004.

The details

The Fair Work Ombudsman has commenced the legal action in the Federal Circuit Court against B2D Pty Ltd, and the company’s sole director, Ms Lakshmi Kumar, who used to run the Fair Espresso Central Market café-restaurant.

Inspectors investigated the outlet after receiving complaints from the workers and formed a reasonable belief that they had been underpaid their minimum ordinary hourly rates, weekend and public holiday penalty rates, casual loadings and meal break entitlements.

The workers were allegedly underpaid individual amounts of between $1,187 and $5,926 for various periods of work between December 2017 and November 2018.

Inspectors issued B2D with a Compliance Notice requiring it to rectify the alleged underpayments, which Fair Work says has not happened.

Business allegedly failed to keep proper records

Fair Work also alleges that B2D and Ms Kumar also failed to keep proper records and issue pay slips.

It’s also alleged that it provided false or misleading records to Fair Work inspectors.

Compliance Notices are not discretionary

Industrial advocate Miles Heffernan from Fair Work Claims said Compliance Notices are not discretionary.

“If you are a business that has not been paying your staff properly, and the regulator issues you with an order to fix the issue, you fix it,” he said.

“If the allegations in this case are proven to be true, then it would appear that this business hasn’t taken the opportunity to rectify the underpayments, so now they are facing court and hefty penalties – a really stupid thing to do.”

Fair Work is seeking penalties and back pay

Fair Work says it is seeking penalties against B2D and Ms Kumar.

The company faces maximum penalties per breach ranging from$31,500 to $63,000, while Ms Kumar faces maximum penalties per breach ranging from $6,300 to $12,600.

The FWO is also seeking a Court Order requiring the company to rectify the underpayments in full, plus interest.

A directions hearing has been listed in the Federal Circuit Court in Adelaide for 20 November 2019.

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