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Pay back employees or face court action: Ombudsman

Word goes out to employers to rectify staff underpayments, as workplace watchdog drags businesses to court for refusal to pay

 

Businesses with outstanding payments to their workers are being encouraged to rectify them in the wake of the Fair Work Ombudsman (FWO) launching legal action against firms that have refused to pay.

The FWO is dragging four businesses to court for allegedly failing to comply with back-payment demands Ombudsman inspectors issued late last year.

Under the Fair Work Act, employers must comply with compliance notices issued from the Ombudsman to pay money owed, unless they have a reasonable excuse or make a court application to challenge the notice.

Ombudsman Natalie James says employers – and professionals who provide advice to employers – need to be aware of their obligations under a compliance notice issued by inspectors.

“Fair Work inspectors have made extensive efforts to engage with these employers in relation to the alleged underpayments but have not been able to secure sufficient cooperation from the employers,” she says.

“It is important for employers to understand that the Fair Work Ombudsman is simply seeking to recover wages that should have been paid in the first instance – we are not seeking to be punitive,” James says.

However, she adds that the FWO is willing to initiate legal proceedings where compliance notices are subsequently ignored and it believes it is in the public interest to do so.

The maximum penalty for a company for failing to comply with a notice to pay is $25,500 per breach, while the maximum penalty for individuals is $5,100 per breach.

The legal proceedings the FWO is taking against the four busineses will be heard in the Federal Circuit Court.

A Brisbane IT firm, Extrados Solutions, is accused of underpaying an employee almost $11,000, while Gold Coast restaurant Absynthe is alleged to have failed to back-pay an apprentice chef $4,195 in wages and annual leave entitlements.

The former owner of Victorian restaurant Anahata Food for Life Indian, Megha Sood, is facing court for allegedly underpaying a chef $8,707.

Meanwhile, Melbourne-based orthodontics specialist Daladontics is accused of refusing to back-pay a total of $9,345 in underpaid wages to two employees.

In each case, the FWO is also seeking an additional court order for the alleged underpayment to be rectified in full.

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