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Restaurant operators fined for failing to backpay employees

27 February 2015


The Fair Work Ombudsman has announced that the operators of a Gold Coast restaurant have been fined a total of $84,500 after engaging in a campaign of "obfuscation" aimed at avoiding having to back-pay nine employees who had been underpaid almost $17,000.

The Fair Work Ombudsman put the matter before the Federal Circuit Court in Brisbane after the restaurant failed to co-operate with its efforts to resolve the matter by agreement.

Judge Michael Jarrett has now found that the restaurant deliberately tried to avoid its obligations to its underpaid staff.

The Hub@Varsity - a tapas bar and restaurant at Varsity Lakes - underpaid the workers a total of $16,881 in wages and entitlements between December 2011 and December 2012.

The venue's manager and part-owner, Graham John Bell, has been fined $14,500 and his family company, The Hub@Mermaid Pty Ltd, a further $70,000.

The Court has also ordered the company to undertake a self-audit of its 2013-14 financial year pay practices at the restaurant and to report back on its findings to the Fair Work Ombudsman within three months.

Judge Jarrett found that Mr Bell and his company chose to ignore them and behave in a "highly evasive" manner, which obstructed the investigation and made it difficult for inspectors to determine amounts owed to employees.

He found that Mr Bell, on behalf of the restaurant, had taken "deliberate action" to avoid responsibilities to employees and engaged in "nothing more than obfuscation and avoidance".

Judge Jarrett said the underpayments were a serious failure to pay the most basic Award provisions and were "especially egregious" for the employees.

The underpayments were finally rectified in June 2014.

Judge Jarrett said there was a need to send a warning to other employers and to ensure compliance with minimum standards to "ensure that there is a level playing field for employers in relation to wage costs".