Fair Work Ombudsman takes Coffee Club franchisee to court

SmartCompany, 5 May 2017

The Fair Work Ombudsman will take a Brisbane Coffee Club franchisee to court after it alleged the franchisee underpaid a worker then required them to pay the business his wages back in cash.

The FWO alleges the workers was paid no wages for four months after commencing his employment at the Coffee Club franchise and was then paid a one-off electronic transfer of $19,334.

The FWO claims the worker was then told by his employer to pay back $18,000 or the employer would cancel his 457 skilled worker visa. Through an investigation, the FWO claims it found the worker was owed a total of $23,546, which has now been paid back in full.

“It is hard to see a legitimate reason why an employer would require employees to be regularly paying back significant parts of their wage, and I am concerned that cashback schemes are being utilised by unscrupulous operators in an attempt to get around record keeping laws and disguise serious underpayment of wages,” Fair Work Ombudsman Natalie James said in a statement.

Penalties of up to $10,800 and $54,000 could be issued against the franchisee director and the company respectively.