Adelaide restaurant obstructed inspector

19 November 2021

The Fair Work Ombudsman has secured $78,220.80 in penalties in court against the operators of a Japanese restaurant in Adelaide that the Court determined engaged in an “elaborate subterfuge against the FWO” designed to “frustrate its essential investigative functions” regarding the investigation into underpayments of two visa workers.

CNL Group Pty Ltd, which operates a restaurant trading as Gyoza Gyoza in the Adelaide CBD under a franchise agreement, has been penalised $66,528 and its sole director Yu Bing Li has been penalised a further $11,692.80.

The Fair Work Ombudsman commenced an investigation after receiving requests for assistance from two Japanese visa holders who CNL Group had employed as waitresses at the restaurant.

Fair Work Inspectors were assisted by the workers’ own records as well as photos of pay records taken by one of the waitresses. The Court found that CNL Group and Mrs Li had paid the workers rates as low as $12 per hour from April to August, 2018.

This resulted in underpayment of the workers’ minimum wage rates, weekend penalty rates and late-night loadings under the Restaurant Industry Award 2010. In total, the two workers were underpaid $10,517.43, which has been back-paid.

Mrs Li and CNL Group also breached the Fair Work Act when Mrs Li hindered and obstructed an inspector at the restaurant in January 2019.

CNL Group also made and kept false payment records and false pay slips which were never provided to the workers, Mrs Li provided false records and the false pay slips to inspectors on CNL Group’s behalf, and CNL Group failed to issue the workers with pay slips and Fair Work Information Statements.

Acting Fair Work Ombudsman Mark Scully said the matter should serve as a warning that employers will be held to account for exploiting vulnerable migrant workers.

“Employers need to be aware that improving compliance in the fast food, restaurant and café sector and protecting vulnerable workers are priorities for the Fair Work Ombudsman and we are prepared to take action in response to serious breaches,” Mr Scully said.

“The conduct in this matter was made even more serious by the employer’s attempts to mislead the FWO and obstruct an inspector carrying out his important duties.”

Judge Stewart Brown, in the Federal Circuit and Family Court, regarded the conduct of CNL and Mrs Li as “extremely serious”, finding that two vulnerable workers had been exploited and left “living hand to mouth” and struggling to pay their rent.

Noting that CNL Group had previously been formally cautioned by the Fair Work Ombudsman for underpaying workers and failing to issue pay slips, Judge Brown found that the breaches were deliberate. His Honour said that the conduct in the matter involved “calculated action designed to frustrate the application of the industrial safety net to vulnerable employees”.

Judge Brown said there was a need to provide a general deterrence message to the industry that “the community will not tolerate the exploitation of employees”.

Employers and employees can visit or call the Infoline on 13 13 94.

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