Pay your employees accurate penalty rates, or else!
Pay your employees accurate penalty rates, or else!
A court has dished out more than $320,000 in penalties to the operators of two suburban IGA supermarkets that had “deliberately” ignored previous warnings on regulatory compliance.
The Fair Work Ombudsman (FWO) said that it had successfully secured penalties against Said “Sam” Haddad, who currently operates and is the majority shareholder of the Fairfield IGA in Melbourne. Mr Haddad formerly held the same role at the Altona IGA. According to the FWO, Mr Haddad and his companies Deja Vu Elite Security and Hadya Nominees admitted in the Federal Circuit Court that they had collectively underpaid six employees at the two stores by $11,373.
Most of the underpayments occurred because the businesses paid flat rates of between $15 and $20 per hour – overlooking relevant penalty rates. However, inspectors found that one worker had not been paid at all for one day’s work. The underpayments occurred over a two-year period from November 2013.
The Ombudsman was particularly scathing given that the underpayments came despite Mr Haddad and the companies having previously been put on notice about minimum pay rates and provided with relevant information about how to ensure compliance.
Judge Heather Riley also ruled that Mr Haddad and Deja Vu Elite Security had deliberately doctored pay records to cover up the underpayments.
“It seems to me that the conduct of the respondents in this case was egregious. It was deliberate. There has been no apology to the employees affected by the respondents’ conduct,” Judge Riley said.
She said there was “considerable need in this case for both general and specific deterrence” and ordered the two companies to pay fines worth a combined $266,886. Mr Haddad was personally hit with penalties of $53,377.
Orders were also made for outstanding superannuation contributions to be paid for two employees, as well as $11,616.90 in legal costs to the FWO.
The Ombudsman noted that the penalties relating to the Altona store covered the time it was owned and operated by Mr Haddad and Hadya Nominees. Its current operators were not involved and are not subject to any complaints about employee remuneration.
Source: MyBusiness.com.au Management 24 October 2018