A Melbourne travel agent has been penalised a staggering $400,000 for underpaying two migrant workers.
The wage theft was the result of an illegal cash back arrangement that was a condition of the company sponsoring the employees on their visas.
Abella Travel, and it’s director Joung Hyung Lee, admitted in the Federal Circuit Court that they forced a migrant worker to pay back over $20,000 of her wages between 2013 and 2015.
The company and Mr Lee also proposed a similar cash back scheme with a second migrant worker.
They also provided false records and failed to pay one of the employees the applicable wage, penalty and overtime rates and leave entitlements.
In total, the two workers from Korea were underpaid a total of $37,464.
Fair Work inspectors launched an investigation after one of the workers complained, and found that Mr Lee had told both workers that the cash back arrangements would be a condition of Abella Travel sponsoring them on 457 visas.
One of the workers told the court that that underpayments forced her to share a bedroom in a share-house and borrow money from family, and the other said she could sometimes not afford public transport and had to walk long distances.
Employer had signed an Enforceable Undertaking
In 2014, Abella Travel was found to have underpaid a Korean national more than $4,200.
Instead of taking legal action, the Fair Work Ombudsman offered the company a chance to enter into an Enforceable Undertaking after it promised to comply with workplace laws moving forward.
Employer ‘recidivist’ offenders
Judge Heather Riley found that Abella Travel and Mr Lee were “recidivists”, saying Mr Lee had “targeted vulnerable people and exploited them for his own financial benefit”.
“The respondents’ behaviour in this regard is deserving of considerable censure, especially as, while underpaying staff, (Mr Lee) has accumulated considerable equity in real estate, and $200,000 cash in the bank,” she said.
Judge Riley also said: “The respondents’ level of dishonesty is such in this case that I cannot be confident that they will not contravene again.”
The court penalised Abella Travel $332,100 and Mr Lee a further $66,420.
All the workers have been back paid.
Enforceable Undertakings over used
Industrial advocate Miles Heffernan from Industrial Relations Claims said Fair Work relies too heavily on Enforceable Undertakings.
“These agreements save the enforcement agency from actually doing any enforcing of workplace laws, and they offer dodgy employers a ‘get-out-of-jail free’ card,” he said.
“Clearly in this case, the travel agency and Mr Lee did not give two hoots about the Enforceable Undertaking, and continued to rip off vulnerable workers.
“Taxpayers fund Fair Work to the tune of $118 million a year, yet they only manage less than 40 litigations annually – you’ve got to wonder if that is really represents good value.”
If you are not being paid your correct wages and entitlements, or if you are considering legal action to recover stolen wages, we can help.
Please call our team at Industrial Relations Claims today on
1300 045 466