Over $730,000 in Unpaid Wages Recovered from Franchises

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Over 730,000 in Unpaid Wages Recovered from
Franchises
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• 731,648 in unpaid wages has been recovered after
  a national investigation into emerging fast food,
  restaurant and café franchises. Almost 80 of
  stores were found to be breaching the law. More
  than 50 had underpaid staff.Fair Work
  Inspectors audited franchises that have recently
  commenced operations in Australia - Chatime,
  GongCha, Hot Star Chicken, PappaRich, Sushi Izu,
  Nene Chicken and The Sushi 79.

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• Franchises were selected based on intelligence
  data that raised concerns about compliance with
  workplace laws, including anonymous tip offs,
  requests for assistance and stakeholder
  referrals.Six of the seven emerging franchises
  were founded overseas - five in Asia and one in
  the USA.

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• During the audits, Inspectors questioned
  employers and employees in 76 stores and assessed
  time and wages records. Inspectors found that
  almost 80 per cent of the stores they visited
  breached at least one workplace law.More than
  50 per cent of all businesses audited had
  underpaid staff.

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• The most common workplace law breaches related to
  pay slip obligations, penalty rates and other
  minimum hourly rates of pay, and
  record-keeping.The Fair Work Ombudsman said the
  audits confirmed concerns about new franchise
  brands, often from overseas, starting operations
  without due diligence on workplace law compliance.

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• In response to the breaches, Inspectors issued 38
  contravention letters, 13 infringement notices
  (totalling 8780 in penalties for pay slip and
  record-keeping breaches), eight compliance
  notices (requiring back-payment of 61,745 for 68
  employees) and 26 formal cautions.Recoveries of
  underpayments have occurred from 40 businesses,
  with more recoveries possible in relation to
  matters still before the court.

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• The Fair Work Ombudsman also commenced court
  action against six companies allegedly involved
  in the most serious breaches, including the
  operator of three PappaRich outlets in Sydney, a
  former Chatime franchisee in Sydney, a company
  and two of its directors operating two The Sushi
  79 stores in Brisbane, and the Chatime Australia
  franchisor Infinite Plus.In August, the Federal
  Circuit Court ordered total penalties of 125,700
  in the The Sushi 79 action. In November 2019, the
  FWO also secured 307,802 in penalties in the
  Papparich action.

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• Every week, we are helping many small businesses
  around Australia move away from manual payroll
  systems and with their payroll wage calculations.
  If you need some help, or are not sure whether
  you are compliant, reach out for a confidential
  chat.