Labor to crackdown on wage theft if re-elected in SA

Labor to crackdown on wage theft if re-elected in SA

THE former franchisee of an inner-Melbourne 7-Eleven outlet will face court over an alleged cashback scheme.

The Fair Work Ombudsman has launched legal action against Xia Jing Qi Pty Ltd, which operated the store on William Street until March 2017, as well as the store’s former manager, Ai Ling “Irene” Lin.

While 7-Eleven head office set up a hi-tech payroll system in 2015 aimed at ensuring employees were paid their lawful minimum entitlements, it is alleged the company and Ms Lin tried to cover up underpayments of three international employees by requiring them to pay back thousands of dollars of their wages.

The affected workers were all young Chinese students aged between 21 and 24 who were in the country on student visas.

From 2015, the company was required by 7-Eleven Head Office to use a new biometric system that recorded work hours by scanning employees’ fingerprints to sign in and out for shifts.

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Head Office then processed the payroll.

However, it is alleged Ms Lin told all three employees in late-2015 that while they would be paid under the system, they would then have to repay a certain sum each week, either by placing the money in a safe in the store or by sending it directly to Ms Lin’s bank account.

It is alleged that after the sum was deducted from their wages, the students earned hourly rates between $8.53 to $26.52.

However, under the General Retail Industry Award 2010, the employees were allegedly entitled to ordinary hourly rates including casual loading of up to $24.30, up to $38.88 on Sundays and up to $48.60 on public holidays.

The three employees were allegedly underpaid a total of $6674 for various periods of work between November 2015 and October 2016. They have since received back pay.

It is also alleged Xia Jing Qi contravened workplace laws by giving the Fair Work Ombudsman false or misleading records.

The matter is the eleventh legal action by the Fair Work Ombudsman against a 7-Eleven franchisee, with more than $1 million in penalties ordered in 7-Eleven cases.

The Fair Work Ombudsman has also commenced a second litigation against the same company, as well as its sole director Jing Qi Xia, for allegedly underpaying an overseas worker at the Ajisen Ramen food outlet in the Melbourne Central Shopping Centre.

The company and Ms Xia allegedly underpaid an employee who was in Australia on a 417 working holiday visa by $9616.

It is alleged she was paid $11.50 per hour between May and October 2016, before being paid just $3.98 per hour in her final week of work.

The rates were allegedly significantly below the minimum hourly rate, casual loading, and penalty rates she was entitled to under the Restaurant Industry Award 2010.

The worker has now also received back pay.

Fair Work Ombudsman Natalie James said cashback schemes were a serious form of exploitation.

“The lawful obligations to pay minimum wage rates and keep accurate employment records apply to all employers in Australia — in relation to all employees — and are not negotiable,” she said.

“We know that workers from overseas backgrounds may be reluctant to speak-up or may be unaware of their rights.

“We make no apologies for targeting businesses who seek to take advantage of these vulnerabilities.”

Xia Jing Qi Pty Ltd faces penalties of up to $54,000 per contravention in each of the matters, while Ms Lin and Ms Xia each face maximum penalties of up $10,800 per contravention.

An injunction restraining the company from underpaying retail and restaurant employees in the future is also being sought, and if granted, the company could face contempt of court proceedings for any further contravention proven in court.

The matters are listed for a penalty hearing in the Federal Circuit Court in Melbourne on October 5.

alexis.carey@news.com.au