Celebrity chef George Calombaris's hospitality empire has backpaid $7.8 million in wages and superannuation after admitting to underpaying more than 500 current and former employees.

Key points: Calombaris apologised to all affected team members and said the MAdE group would act as "a force for change" in the industry

Calombaris apologised to all affected team members and said the MAdE group would act as "a force for change" in the industry A former employee called for him to lose his MasterChef job

A former employee called for him to lose his MasterChef job The hospitality group said it had paid back all of what was owed to workers

His MAdE Establishment group of companies will also make a $200,000 "contrition payment" under a court-enforceable undertaking made with the Fair Work Ombudsman.

The Melbourne-based hospitality group self-disclosed the underpayment at its Press Club, Gazi and Hellenic Republic restaurants.

Fair Work inspectors also found some employees at the Jimmy Grants chain — which shares some shareholders and directors with MAdE — had missed out on entitlements.

The investigators found "significant underpayments" at the restaurants were because annualised salary arrangements were not correctly applied for some staff, and they missed out on overtime and penalty rates.

They also found the MAdE restaurants and some Jimmy Grants stores did not pay some staff at the correct award level, which hit casual staff in particular.

Calombaris is a founding and current shareholder of MAdE Establishment and served as a director from 2008 to 2018.

"We apologise to all our affected team members, past and present — as it is our people that make our restaurants great, and it is our priority to ensure all of our employees feel respected, rewarded and supported in their roles," he said in a statement.

"We are committed to acting as a force for change in the industry and leading by example when it comes to building and promoting supportive, healthy and compliant hospitality workplaces."

As part of the undertaking, the MasterChef judge will have to "complete speaking arrangements to educate the restaurant industry on the importance of workplace compliance".

'He should be taken off MasterChef'

MAdE backpaid $7,832,953 to 515 current or former employees at its Press Club, Gazi and three Hellenic Republic restaurants. Jimmy Grants paid a further $16,371 to nine employees.

Mr Calombaris is perhaps best-known for his role as a judge on MasterChef. ( AAP: Joe Castro )

The staff were underpaid for work between 2011 and 2017.

In 2017, the group apologised to 162 employees for underpaying them and gave them backpay totalling $2.6 million.

Former Hellenic Republic waitress Orlaith Belfrage, who has alleged she was underpaid, said her former boss should be "properly punished".

"George should pay a serious price for this massive theft of workers' wages," said Ms Belfrage, who is now an organiser for the Hospo Voice union.

"He should be taken off MasterChef. How many more excuses does George get?"

Orlaith Belfrage said Mr Calombaris should be "properly punished". ( ABC News: Ben Knight )

She said it was likely "way more" than 515 workers had been underpaid at MAdE venues and called for harsher penalties for wage theft.

"Workers have requested repeatedly that Calombaris hand over records so that they can recover their stolen wages and he has not provided them with the documents they need to recover their money," she said.

Matt Preston, Calombaris's co-host on MasterChef, said his friend was sorry about what had happened.

"I've talked to him this morning, he's upset. George genuinely loves the staff, that's why he wants to pay them back," Preston told ABC Radio Melbourne.

"I think one of the things we will agree on, is you've got to pay your staff what you owe."

Space to play or pause, M to mute, left and right arrows to seek, up and down arrows for volume. Watch Duration: 2 minutes 57 seconds 2 m 57 s Matt Preston says underpayment of workers is widespread in society

Preston said wide-scale underpayment was not an issue confined to the hospitality industry, taking aim at the ABC for its own history of not paying casual staff their full entitlements.

He said whether MasterChef would be damaged by the revelations would depend "on how people perceive it".

$200,000 a 'piddling percentage', lawyer says

The undertaking requires each venue to pay for independent auditors to check pay and conditions every year until 2022.

Fair Work Ombudsman Sandra Parker said in a statement that the undertaking committed MAdE Establishment to "stringent measures to ensure that current and future employees across their restaurant group are paid correctly".

"MAdE's massive back-payment bill should serve as a warning to all employers that if they don't get workplace compliance right from the beginning, they can spend years cleaning up the mess."

But lawyer Oahn Tran, who had represented MAdE employees, told ABC Radio Melbourne the $200,00 payment was not enough.

"$200,000 of 7.8 million is a piddling percentage of what was taken from workers throughout the time that Calombaris was employing them," she said.

"It can potentially become a cost of doing business, you can say 'how long can I get away with it and what am I going to be hit with, potentially just a slap on the wrist'."

The MAdE group runs three Hellenic Republic restaurants, including this one in Brunswick East. ( ABC News: Ben Knight )

In a statement, MAdE said the incorrect payments were identified during a review in early 2017.

It said the employees had been "incorrectly classified and underpaid due to incorrect processes and failures within its payroll and human resources functions".

MAdE Group CEO Leigh Small said all current team members were now correctly classified and new processes had been put into place.

Mr Small said all entitlements verified as owed to current and past employees had been paid, with "a handful" of claims still being finalised.