Running on empty: Petrol business in court over claims workers were underpaid almost $50,000

A former petrol station operator is facing legal action from the Fair Work Ombudsman for allegedly underpaying two console operators almost $50,000.

The business, Wedderburn Petroleum Pty Ltd, formerly operated a Caltex petrol station at Wedderburn in regional Victoria.

It is alleged Wedderburn underpaid the two staff members a total of $47,258 between 2008 and 2013. The employees were allegedly underpaid individual amounts of $25,621 and $21,637.

It is alleged they were paid flat hourly rates ranging from $10 to $15.96 for all hours worked, which has resulted in underpayment of their minimum hourly rate, casual loadings, annual leave entitlements and penalty rates for weekend, public holiday and overtime work.

Fair Work Ombudsman Natalie James said attempts by inspectors to resolve the matter with Wedderburn voluntarily had failed, leading to the decision to place the case before the court.

The FWO reports the company allegedly breached record-keeping and payslip laws, and if convicted it faces penalties of $33,000 to $51,000 per breach.

The FWO is seeking a court order for Wedderburn to rectify the underpayments in full. The hearing is due in the Federal Circuit Court, Melbourne on March 26.

Earlier this week, the FWO also announced it had commenced legal proceedings against a Melbourne-based cleaning company for an alleged $130,000 in unlawful wage deductions of its staff.

The alleged deductions included “administration fees” and “meals” for staff that were contracted out to another business.

The fines for underpayment or false wage deductions can be hefty.

In late 2013, a Perth cleaning company was hit with a record-breaking fine of $343,860 for underpaying six workers, with the judge saying the business had limited the ability of the FWO to investigate.

The employees, including five foreign workers, had been employed as cleaners and were underpaid a total of $22,510.

Housekeeping Pty Ltd was fined a total of $286,550 and the business’s manager was penalised a further $57,310. The total fine of $343,860 was a record for the FWO.

Also in 2013, a Melbourne-based grocery importation business was fined almost $130,000 for underpaying a truck driver more than $120,000.

Following FWO action, the court ruled Dandenong-based business Lay Brothers repay the truck driver $124,816 and pay a penalty of $128,700.

The underpayments occurred between 2007 and 2011 while the driver was working up to 60 hours a week.

Workplace law expert Peter Vitale previously told SmartCompany it is up to the employer to be aware of the correct penalty rates.

“Ignorance of these obligations, whether it’s deliberate or by omission, is unacceptable,” he said.

The FWO has increasingly been focused on mediation and voluntary resolution in underpayment matters.

“This is leading to a significant number of satisfactory resolutions before it becomes necessary for the authority to conduct a full investigation,” Vitale said.

“But it’s important to bear in mind the Ombudsman has always made clear it reserves the right to commence legal action in exceptional circumstances.”