Two sushi outlets penalised $125,700

The operator of two sushi outlets has been hit with penalties of over $125,000. In a recent case described by lawyers as a test case for whether employers are effectively guilty until proven innocent in terms of wages record-keeping.

While the "reverse onus of proof" was not ultimately needed in this particular case, it will be interesting to see how this evidentiary presumption is applied in practice by Courts in future.

The FWO launched legal action against A&K Property Services Pty Ltd, which operates two Sushi 79 stores in Queensland, one on the Sunshine Coast and the other in Ipswich.

It claimed that audit activity had uncovered wage and super underpayments totalling $26,883, but also alleged the business had "failed to keep property time and wages records and failed to issue any payslips to employees".

These underpayments, the regulator said, were to nine visa holders, all from South Korea, who were shortchanged anywhere between 7.69 per cent and 43.32 per cent of what they were legally entitled to be paid.

The prosecution was the FWO's first under law changes made in 2017 that were designed to protect vulnerable workers, such as migrants and visa holders and young people, who may not fully understand or be aware of their legal employment rights.

According to the FWO, Judge Michael Jarrett had deemed A&K Property Services' record-keeping breaches as being "particularly serious" offences.

"When an employer does not make and keep employment records, an effective safety net for employees is difficult to maintain and results in those employees being more vulnerable to exploitation. I am satisfied that the respondents' conduct, whilst not deliberate, was plainly grossly reckless," it quoted the judge as stating.

While the wage and super underpayments - which had accumulated as a result of a shortfall on both normal hourly rates as well as penalty rates, overtime and leave underpayments under the Fast Food Industry Award 2010 - have since been repaid, penalties worth $125,700 were handed down.

The FWO said the bulk of this was issued to the business, which was ordered to pay $108,000.

Meanwhile, director Yong Sin Kim was personally fined $10,600, while other directors Hyun Jun Kang and Jungpyo Lee were fined $3,550 each after they were deemed not to be involved in the record-keeping and payslip breaches.

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