Foreign students on internship scheme allegedly underpaid

The operators of cafe 85 Degrees in Sydney is set to face Federal court for alleged underpayments committed against young Taiwanese student employees under the guise of a purported internship arrangement.

The Fair Work Ombudsman allege that Taiwanese company Comestibles Master Co Ltd, the franchisor of the 85 Degrees’ café underpaid eight Taiwanese students a total of $429,393.18 between July 2016 and June 2017, with each being unpaid more than $50,000 over that one-year period.

The regulator also allege that 85 Degrees Coffee Australia Pty Ltd, which operates factories and cafes under the 85 Degrees brand in Sydney where the students performed work, was an accessory to some of the contraventions that occurred between April and June 2017.

The workers concerned, who were students at the Taipei City University of Science and Technology in Taiwan, came to Australia on working-holiday visas under an internship arrangement between Comestibles Master Co Ltd and the University, to work in 85 Degrees factories and retail stores in Sydney operated by 85 Degrees Coffee Australia Pty Ltd.

Four of the students worked at an 85 Degrees cake factory in St Peters preparing and packing cakes and cleaning; two worked at 85 Degrees bread factory in Hurstville preparing and packing bread products; one worked across the St Peters factory and the 85 Degrees café outlet in Hurstville and one worked at the 85 Degrees café outlet on George Street in the Sydney CBD.

The employees were said to have worked 60 to 70 hours per week and that each of the employees was underpaid between $50,213 and $58,248, far below the minimum rates and entitlements they were supposed to be paid under the applicable Awards, including minimum wage rates, overtime rates, penalty rates, annual leave entitlements and superannuation. Contraventions of record-keeping and pay slip laws have also been allegedly committed.

In addition, 85 Degrees Coffee Australia Pty Ltd is said to have contravened a term of an Enforceable Undertaking it entered into with FWO in 2015 in respect of contraventions relating to other Chinese and Taiwanese visa holders and that the contraventions relating to the students in 2016 to 2017 occurred despite 85 Degrees Coffee Australia Pty having previously been the subject of the Enforceable Undertaking in 2015.

“All franchisors setting up operations in Australia must abide by our laws and pay the lawful minimum pay rates that apply to all workers, regardless of nationality or visa status,” Fair Work Ombudsman Sandra Parker said.

The FWO is seeking a court order requiring the companies to rectify the alleged underpayments in full. Comestibles Masters Co Ltd and 85 Degrees Coffee Australia Pty Ltd face penalties of up to $54,000 per contravention for multiple alleged contraventions of workplace laws.

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