School tuckshop cops $24,000 fine in Fair Work Ombudsman case

The former operators of a Melbourne school canteen have been fined $24,288 for underpaying four employees.

Unger Catering Services, specialising in kosher food, underpaid staff at Mount Scopus Memorial College a combined total of $13,768 between 2007 and 2011.

The staff, women between the ages of 38 and 58, were paid less than the minimum wage and denied penalty rates, overtime, casual loadings and superannuation.

Unger Catering Services has been fined $21,120, with company owner Sharon Unger receiving a $3168 fine.

This is not the first time Unger has been found guilty of underpaying staff. Fair Work records dating from 1998 show Unger was forced to back-pay 14 staff.

The Fair Work Ombudsman said Unger’s history of underpaying staff was a key factor in the decision to launch legal action, resulting in the high penalty.

Employment and industrial relation lawyer Peter Vitale agreed previous offences should be taken into account when penalising offenders.

“The court will take into account a range of factors including the size of the underpayments, the size of the business and the extent to which they’ve tried to make their breaches right, so all of that would’ve been taken into account by the court,” he says.

Vitale says cases involving repeat offenders are uncommon.

“I have to say that I haven’t dealt with employers that deliberately seek to underpay their employees, this particular case is unusual in the sense that it’s happened with the same employer twice and I would’ve thought, frankly, that not acceptable” he says.

Vitale says it is important employers inform themselves of their obligations.

“Again this is a case which highlights that small businesses need to be aware they have to devote time and attention to determining what their obligations are to their employees.”

Lack of resources, clarity and support can all be contributing to factors to an employers’ failure to comply with obligation, Vitale says.

“The majority of employers do try to do the right thing, many of them are very time poor and not equipped with the support of the information that should be there,” he says.

Vitale says it is the employers’ responsibility to ensure they have access to appropriate information and guidelines.

“There is no excuse; ignorance of the law is no excuse. They should understand and devote appropriate time to determining what their obligations are.”

The acting Fair Work Ombudsman, Michael Campbell, said most employers do not purposely seek to underpay their staff.

“The large majority of employers do the right thing by their employees. We find that most cases of underpayment are inadvertent and are the result of employers not being fully aware of the minimum pay rates that apply to staff in their business,” he said in a statement.

In her judgment on the case, Judge Norah Hartnett said the previous underpayments should have impressed upon Unger Catering that underpaying employees was completely unacceptable and illegal.

“It did not have that effect,” Judge Harnett found. “The employers were not taking the necessary steps to prevent further contraventions as highlighted by these proceedings.”

Judge Harnett also highlighted the suffering and deprivation the underpayments had on the staff, saying employees “suffered hardship as a consequence”.