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Children’s Clothing Retailer In Court Over Underpayments

Children’s clothing retailer in court over underpayments

A children’s clothing retailer is facing court action after allegedly underpaying four migrant workers more than $140,000.

The Fair Work Ombudsman has accused the company of breaching Protecting Vulnerable Worker laws by committing serious contraventions including hindering or obstructing Fair Work inspectors.

Blue Sky Kids Land, which operates outlets in Canberra and Sydney, and its directors, Guo Dong Gu and Fei Rong Yang, are facing the Federal Court.

The underpayments

The four workers are women in their 40s from China who speak limited English.

They were employed as sales people in the stores.

Fair Work inspectors discovered the underpayments after one of them complained to the workplace watchdog.

Between October 2015 and June 2018, the employees were allegedly underpaid wage and penalty rates, in addition to not being paid any superannuation.

Individual underpayments range from $16,007 to $47,285.

One of the workers was not paid annual leave.

Inspectors provided with false records

Fair Work also alleges that companies operated by Mr Gu and Ms Yang provided inspectors with false records.

It is alleged that some of the contraventions – relating to record-keeping failures, non-issuing of pay slips and paying rates as low as $10 an hour – are serious contraventions under the Protecting Vulnerable Workers laws.

Company allegedly closed stores and deleted time sheets to hinder investigation

It the first time the regulator has alleged a breach of the new provision of hindering or obstructing a Fair Work inspector.

It is alleged that during the investigation, Blue Sky Kids Land and Mr Gu ordered a Canberra store be closed so that inspectors could not conduct a site visit.

It is also alleged that the company and Ms Yang obstructed an inspector by ordering the deletion of time sheets.

In addition, an employee was threatened with the sack for speaking to an inspector.

Company faces hefty penalties

Industrial advocate Miles Heffernan from Fair Work Claims said the allegations were disturbing.

“We know that migrant workers are particularly vulnerable to exploitation by greedy bosses, because they might not know the language, or they might not be familiar with their rights, and in some cases they are frightened to speak up because they fear their visa might be cancelled,” he said.

“That’s why the Protecting Vulnerable Workers legislation was introduced, and with it, some fairly hefty penalties.”

Serious contraventions attract a maximum penalty of $630,000 for companies, and $126,000 for individuals.

A directions hearing is listed in the Federal Court next month.

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