Burger chain pack pays workers whopping $1.12m

By Nick Hall | 06 Dec 2019 View comments

The Australian arm of Japanese burger chain MOS Burger has back-paid a whopping $1.12m to 285 workers following an investigation.

The Fair Work Ombudsman (FWO) investigation uncovered contraventions of the Fast Food Industry Award 2010, prompting action. As a result, MOS Burger Australia Pty Ltd has entered into a court-enforceable undertaking, but the burger chain is likely to face ongoing scrutiny moving forward.

MOS Burger Australia, which operates as an exclusive franchise partner and territory holder to the Japanese business holds six outlets across Queensland. According to reports, the 285 underpaid workers were employed across all six, at Brisbane, Surfers Paradise, Southport, Broadbeach, Mt Gravatt and Sunnybank between 2011 and 2018.

Burger chain workplace breaches revealed

The primary concern for MOS Burger workers related to pay-rates and employee contracts. According to the FWO, inspectors found that the burger chain had paid unlawfully low rates to workers, while simultaneously misclassifying some employees as part-time, when they were in fact casual.

Additionally, MOS Burger Australia failed to pay applicable penalty rates, casual loading and ordinary hourly rates, resulting in underpayment ranging from as little as $18 all the way up to $31,975.

While the burger chain has since rectified all unpaid wages and superannuation, including a seven per cent compensation bump, the case sees the issue of migrant worker underpayment resurface.

Sandra Parker, Fair Work Ombudsman revealed that many of the workers, employed by the burger chain to make food, serve customers, and act as store supervisors and managers were visa holders.

“We considered that a court-enforceable undertaking was an appropriate enforcement tool as the company conducted a comprehensive audit of its pay records from when it commenced trading in Australia, fully back-paid workers and overhauled its processes to comply with workplace laws,” Parker said.

Court-enforceable undertaking

Under the terms on the undertaking, MOS Burgers Australia must fund external auditors to check pay and conditions for workers employed in 2019 and 2020.

Parker went on to explain that the FWO would continue to monitor the burger chain for compliance-related concerns in the future.

“Court-enforceable undertakings are serious instruments with extensive commitments from companies,” she said.

“We will monitor compliance with each commitment and won’t hesitate to take court action if they are not upheld. This matter is a warning to all employers that if they don’t get workplace compliance right from the beginning they can be left with extensive and expensive consequences.”

MOS Burger’s Australian franchise is just one of a wide range of fast-food outlets to be caught up in underpayment scandals over the last 12 months.

Parker reaffirmed the watchdog’s stance on wage theft and compliance, urging all concerned employees to come forward.

“The Fair Work Ombudsman is cracking down on underpayments in the fast food, restaurant and café sector, and any employees with concerns about their pay should contact us,” Parker said.