Cocktail bar penalised over underpayments

The former operators of a rooftop cocktail bar in Melbourne’s CBD have been penalised for ignoring a Compliance Notice ordering it to rectify the underpayment of a staff member.

The Federal Circuit and Family Court imposed a $15,624 penalty against Don Haris Kumarage, the director of C & H Entertainment Pty Ltd, the former operator of The Red Hummingbird bar, and a $12,096 penalty against its former manager, Channa Dissanayake.

Kumarage was found to have been involved in the company’s breach of the Fair Work Act by its failure to comply with a Compliance Notice which required it to back-pay a worker, a British national in Australia on a 417 working holiday visa. In addition, Kumarage and Dissanayake were found to be involved in record-keeping and pay slip breaches by the company.

A Fair Work Inspector previously issued a Compliance Notice to Kumarage on behalf of the company in September 2019 after having found that the company failed to pay the worker her correct entitlements between January and April 2019.

The inspector formed the opinion that the worker was underpaid of casual loading, and penalty rates for weekend, public holiday, late night and early morning hours, under the Hospitality Industry (General) Award 2010.

The company went into liquidation after the Fair Work Ombudsman commenced court action.

Fair Work Ombudsman Sandra Parker said the regulator would continue to enforce laws in a proportionate manner during the COVID-19 pandemic, and business operators that fail to act on Compliance Notices need to be aware they can face court-imposed penalties on top of having to back-pay workers.

“When Compliance Notices are not followed, we are prepared to take legal action to ensure workers receive their lawful entitlements,” Parker said.

In his written judgment, Judge Philip Burchardt said the employee’s visa status put her in “a particularly disempowered position”.

“If [the company] had complied with the compliance notice, the [Fair Work Ombudsman] would not have been able to bring civil remedy proceedings,” Judge Burchardt said.

The judge accepted the Fair Work Ombudsman’s evidence that the employee only provided one payslip which was found to be non-compliant. “There is no doubt that payslips are important. This has been made clear in numerous prior court decisions,” Judge Burchardt said.