“Those engaged in employing people in Australia must be aware that they face significant penalties for breaching their legal obligations in respect of their employees – those penalties cannot be seen as no more than an acceptable cost of doing business.”
A labour-hire operator in Sydney who says she hired young Asian workers because they are “younger, cheaper and faster than locals who are old and slow” has been penalised more than $100,000, as a result of legal action by the Fair Work Ombudsman.
Sydney woman Yan Hu has been penalised $17,556 in the Federal Circuit Court and her company Global Express Consultancy Pty Ltd has been penalised a further $87,783.
The penalties were imposed in the Federal Circuit Court after Hu admitted breaching workplace legal obligations by underpaying 19 employees – all 417 working holiday visa-holders from Taiwan and Hong Kong – a total of more than $45,000.
Fair Work Ombudsman Natalie James says the penalties should help to dispel the myth that overseas workers of any particular nationality can be paid a “going-rate” that is less than what the law requires.
“Overseas workers are entitled to receive the same minimum rates and entitlements that apply to all workers in Australia – and the rates are not negotiable,” Ms James said.
Ms James says there is a need to raise awareness of minimum entitlements among both employers and overseas workers in light of her Agency’s Inquiry into the experiences of 417 visa-holders finding that many working holiday makers are not aware of their workplace rights and that lack of awareness is highest among Asian workers.
The Global Express employees were underpaid between February, 2014 and May, 2015 when Hu’s company supplied them to work at three factories in Sydney:
Hu paid employees flat rates of $16 to $18 an hour, resulting in underpayment of the minimum hourly rates, casual loadings, Saturday penalty rates and overtime rates the employees were entitled to under the applicable Awards.
Hu also unlawfully deducted bonds of up to $400 from some of the employees’ wages, to be returned if they stayed with her company for at least six months and were not “lazy”. Legal obligations with regard to pay slips were also contravened.
Fair Work inspectors investigated after employees contacted the Agency for assistance.
Judge Justin Smith found that Hu, who first came to Australia from China as an international student in 1999, was “very frank” in her discussions with them.
“I find that Global deliberately sought to engage foreign nationals as employees because of Ms Hu’s opinion, which she willingly shared… that they were ‘younger, cheaper and faster than locals who are old and slow’,” Judge Smith said.
Ms Hu also told an Inspector that she had paid “the market rate” and been “reasonable” but that the workers had complained because they were “greedy”.
The underpayments were rectified only after the Fair Work Ombudsman took legal action.
Judge Smith found that the underpayments were part of a “deliberate strategy aimed at maximising Global’s profits”. Judge Smith found that Ms Hu had shown a lack of contrition and there was a strong need for general deterrence.
“Those engaged in employing people in Australia must be aware that they face significant penalties for breaching their legal obligations in respect of their employees – those penalties cannot be seen as no more than an acceptable cost of doing business,” he said.
“Further, it is important for employers to recognise that foreign nationals, just as much as Australian residents and citizens are entitled to full pay for work done by them and that the vulnerability of those workers will be taken into account in the assessment of penalties.”
