Business that skimmed worker pay packets to cover visa costs fined $58,000

A Sydney day spa operator has paid more than a dozen workers over $65,000 and admitted to making unlawful deductions from their salaries in the latest example of wage theft spotlighted by the Fair Work Ombudsman (FWO).

The director of franchised Endota Spa Sydney has signed a court-enforceable undertaking with the FWO to clean up their act after an investigation found international workers were having visa-related costs taken out of their pay packets.

Fair Work inspectors alleged the $58,000 in deductions took place over a four-year period, totalling $250 in stolen wages per fortnight, stopping after the costs associated with visa sponsors, which can be up to $7,000 per person, were recouped.

A further $7,900 was recovered in unpaid penalty rates and annual leave entitlements, two areas of common non-compliance in underpayment cases.

A $10,000 “contrition payment” has also been levied against the director of the business, who will also be required to conduct regular audits across the company’s six spa centres in NSW over the next two years.

“Businesses can’t use deductions from workers’ salaries as a bargaining chip to keep them employed in the business,” fair work ombudsman Sandra Parker said in a statement circulated on Tuesday morning.

“This significant back-payment bill should also serve as a warning to all employers that it is not acceptable to underpay migrant workers, or make unlawful deductions. Employers who do this will get caught.”

Tuesday’s undertaking is just the latest in a long line of wage theft cases which continue to rock Australia’s workplace law regime, as regulators discuss ways to strengthen the integrity of the system and the FWO adopts an aggressive approach to non-compliance.

Last week celebrity chef George Calombaris made headlines when it was revealed the scale of underpayment across his high-end restaurants was $7.8 million.

SmartCompany contacted the Endota Spa director for comment but didn’t receive a response prior to publication.

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