Sushi restaurant fined over $350k for underpayments and falsified records

The operators of a Brisbane sushi restaurant incurred a total of $355,000 in penalties after the court determined they deliberately underpaid employees and falsified records.

The Federal Circuit and Family Court has imposed a $305,000 penalty against Delishesco Pty Ltd, which operates Moga Izakaya & Sushi and a $50,000 penalty against the company’s sole director Yinan Yang, who manages the restaurant.

The total penalties obtained in the case are noted to be the second-highest the FWO has obtained in a Queensland matter and one of the highest the FWO has obtained in a case nationally.

Delishesco had previously been formally cautioned by the FWO for underpaying staff but was found to have ignored the reminder and deliberately underpaid 34 employees a total of $75,716 between December 2018 and March 2019 – as well as having deliberately provided the FWO with false records during an investigation.

Most of the employees were Chinese, Japanese, Korean or Thai visa holders. Some were young workers, aged between 19 and 21.

Fair Work Ombudsman Sandra Parker said that the case demonstrates that the regulator will use all available powers to ensure employers who deliberately exploit workers are held to account.

“As the substantial penalties highlight deliberately exploiting migrant workers and using false records even after the regulator has put you on notice is extremely serious conduct that will not be tolerated,” Parker said. “All workers in Australia have the same rights, regardless of nationality and visa status, and those rights must be respected.”

Fair Work inspectors investigated after one of the underpaid workers contacted the FWO to allege he was being paid just $16 an hour. They found that the 34 affected employees, who worked as wait staff, cooks, kitchenhands and dishwashers and were mostly casuals, were variously underpaid minimum wage rates, casual loadings, overtime, split-shift allowances, and penalty rates for weekend, public holiday, and night work, under the Restaurant Industry Award 2010 and National Employment Standards. Delishesco also breached record-keeping and payslip laws.

Individual underpayments ranged from $92 to $9588. Delishesco back-paid the workers only after the Fair Work Ombudsman commenced legal action.

Judge Salvatore Vasta found that the matter involved deliberate and systematic underpayment of vulnerable workers and there was a need to impose penalties to deter others from such conduct.

“In this case, the aspect of deterrence looms large. In fact, it might seem that it overshadows almost everything else. The severity and seriousness of what (Delishesco and Mr Yang) have done cannot be overstated,” Judge Vasta said. “Most of these employees are workers on visas who are apt to being exploited because of their unfamiliarity with the English language and Australian industrial law.”