The operators of a remote Northern Territory homestead have been penalised a total of $56,766, after ignoring pay advice and underpaying more than a dozen backpackers from overseas.
David Mayne Pty Ltd, which trades as the Barkly Homestead, has been penalised $48,320 after admitting to underpaying the 17 employees a total of $23,753. In addition, homestead manager and company shareholder Andrew Mayne has been penalised $8446.
The Barkly Homestead offers accommodation, a restaurant and a roadhouse on the Barkly Highway, about 210 kilometres east of Tennant Creek. Fair Work Ombudsman inspectors conducted a proactive audit of the business as part of a regional campaign that involved audits of 38 businesses in the Northern Territory.
Inspectors found that David Mayne Pty Ltd had paid 17 workers at the Barkly Homestead a flat rate of $19.21 for all hours worked between October 2015 and April 2016. The workers were engaged on a full-time basis, mostly as cleaners and waiters, and most were backpackers from overseas in Australia on 417 working holiday visas. They worked an average of 48 hours per week, leading to significant underpayment of their weekday overtime rates. Some workers were also variously underpaid a broken shift allowance and Sunday and public holiday penalty rates.
Under the Hospitality Industry (General) Award 2010 at the time, the backpackers were entitled to $27.71 an hour for each of the first two hours of overtime and $36.94 for additional overtime thereafter. Underpayments of individual workers ranged from $623 to $3763.
The workers were back-paid in full last year, save for three who have not been located. The Fair Work Ombudsman is holding the back-payments for the three workers as it attempts to locate them.
The underpayments occurred despite David Mayne Pty Ltd having obtained advice from an industrial relations specialist that detailed how it could go about lawfully paying employees an annualised salary according to the Hospitality Industry (General) Award 2010 or, alternatively, pay employees the prescribed penalty and overtime rates under that Award.
The Fair Work Ombudsman submitted in Court that the company ignored both options – and also failed to seek advice from the Fair Work Ombudsman or the Australian Hotels Association, which it was a member of – and instead chose to short-change its employees for its own benefit.
Mayne claimed in Court that he had simply overlooked the company’s obligations due to pressure of work in the business. However, Judge Tony Young said he “had some difficulty accepting that the breaches were the result of inadvertence”.
“I consider that the underpayments were the result of at least recklessness, and by that I mean I am satisfied that there was a deliberate failure to inquire about and implement the provisions in the employee contracts that required the application of the award in relation to overtime rates,” Judge Young said.
He also noted the matter involved the underpayment of workers from overseas and said that “a message needs to be given that these workers are as entitled to the same protection of minimum standards as an Australian worker”.
“There is evidence of a high incidence of underpayment of entitlements in the hospitality industry and I consider that the underpayment of minimum standards, or the failure to comply with minimum standards, undermines the safety net that is one of the objects of the (Fair Work) Act,” he said. “Another factor is that underpayments provide a competitive advantage for an underpaying employer and, to that extent, it upsets the level playing field and disadvantages enterprises that comply with minimum standards.”
Judge Young has ordered Mayne to register with the Fair Work Ombudsman’s online My Account portal and complete all education courses for employers.
