Mamak Back In Court For Underpaying Migrant Workers

The operators of famous inner Sydney restaurant Mamak are again in Court accused of further underpayments, after being penalised almost $300,000 last year for exploiting overseas workers.

Sydney’s Malaysian restaurant Mamak has again allegedly underpaid two employees from their Chatswood restaurant and has created false payslips to disguise the underpayments to authorities.  One employee was an Australian citizen and worked as a waiter, while the other employee was a waitress from Singapore working in Australia on student and bridging visas.

Summary

The Fair Work Ombudsman have again commenced proceedings in the Federal Circuit Court against the three owner-operators of Mamak Malaysian restaurants in Sydney, who have allegedly significantly underpaid two of their employees in the Chatswood restaurant between 2014 and 2016.

False payslips were created to disguise the underpayments of the employees, one of which was an Australian citizen whilst the other was a waitress from Singapore working in Australia on student and bridging visas.

This is not the first instance where Mamak has breached fair workplace laws and exploited vulnerable workers. In 2016, the owner-operators were penalised $294,848 for underpaying six Mamak employees at the Haymarket restaurant. Five of these employees were visa-holders, and were paid approximately $11 per hour from 2012 to 2015.

It was also acknowledged by Judge Justin Smith when handing down these 2016 penalties that the three respondents were aware of the award and had deliberately chosen to ignore it, to maximise profit. Despite the Mamak owners-operators swearing in Court to ensure future compliance with workplace laws, Mamak have allegedly continued to exploit vulnerable workers.

This problem is widespread across the hospital industry, as seen through the National Hospitality Industry Campaign’s findings that employees across Australia were underpaid over $2 million in 2016. A study by the University of Sydney also found that 80% of international workers on student visas are being paid below the minimum wage in restaurants.

What laws has Mamak breached?

The two workers were allegedly paid approximately $12-13 per hour – an amount which is significantly below the minimum hourly rate, in accordance with the Restaurant Industry Award 2010. Mamak also failed to take into account casual loadings, as well as weekend, public holiday and late night penalty rates. These laws apply to Australian and non-Australian workers equally.  Mamak has also breached its record-keeping obligations under s 536 of the Fair Work Act 2009 (Cth).

What are the implications of this breach?

The Mamak owner-operators Joon Hoe Lee, Julian Lee and Alan Wing-Keung Au face penalties of up to $10,800 per breach and the company may be penalised a further $54,000 per breach. The restaurant has also been exposed widely in the media for its mistreatment of workers, and will suffer reputational damage as a result of its non-compliance.

How can your business avoid this type of breach?

The Fair Work Ombudsman has stated it is focusing on addressing non-compliance in the hospitality industry, and is conducting a series of proactive audit campaigns and targeted investigations on restaurants.

Employers should ensure that they are toeing the line when it comes to compliance with workplace and immigration laws, including maintaining correct employee records and payslips, and meeting their obligations under workplace laws and relevant awards.

It is also important that employers and employees be aware of their fair work rights, particularly migrant workers who may not be aware of specific minimum wages.

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