Record-breaking underpayment case: Perth cleaning company slammed by Fair Work with $340,000 fine

A Perth cleaning company has been smacked with a record-breaking $340,000 fine for underpaying six workers, with the judge saying the business had limited the ability of the Fair Work Ombudsman 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, Catherine Paino-Povey, was penalised a further $57,310. The total fine of $343,860 was a record for the FWO.

Federal Circuit Court judge Toni Lucev found the underpayments had been deliberate.

“The penalty must be an appropriate level to deter others within the industry and other industries from committing similar breaches of Australian workplace law,” he said.

Of the six underpaid workers, four were women and two were men aged between 20 and 30. The foreign nationals came from Taiwan, Hong Kong, New Zealand and Ireland and three of the workers spoke limited English.

The cleaners were underpaid varying amounts ranging from $1915 to $4554 between June 2011 and January 2012, despite the employees only working for the company for between one and three months.

The employees worked for nine to 10 hours a day cleaning homes around Perth, but they were only paid for 7.6 hours.

They were also underpaid overtime, penalty rates, had money unlawfully deducted from their wages and were underpaid leave, meal breaks and time entitlements.

Lucev found the business had also prevented the FWO from conducting a proper investigation, gave dishonest representations to the ombudsman, and showed no remorse.

“There is evidence that the corporation and Ms Paino-Povey, at least for the time being, have continuing involvement in the cleaning industry, and that involvement has generated ongoing complaints to the Fair Work Ombudsman,” he said.

SmartCompany contacted Housekeeping, but there was no comment available prior to publication.

The FWO is well known for coming down hard on businesses which deliberately exploit foreign workers.

In June, Over the Top Happy Cleaning Services was found guilty of “gross exploitation” of international students and ordered given a fine of $50,000.

Workplace relations lawyer Joel Zyngier told SmartCompany at the time the FWO has been targeting the cleaning industry for “quite some time”.

“It’s an unfortunate part of our economy that there are vulnerable workers and there are people who are willing to exploit them.

“From time to time it (the FWO) has targeted campaigns where it uses all of its various powers including inspection, door-knocking and court action,” he says.