Café franchisee in underpayment scandal

By Nick Hall | 15 Aug 2019 View comments

A Han’s Café franchisee in Western Australia is the latest business owner to come under fire for underpayment, following an investigation by the Fair Work Ombudsman (FWO).

Theo Jose Dominic Sayoco, Grace Bela-Ong Sayoco, and the company T J D Sayoco Pty Ltd, trading as Han’s Café Mandurah, have entered into a court-enforceable undertaking with the workplace regulator.

Under the terms of the undertaking, the Han’s Café franchisee will back-pay 16 workers $27,086.

It’s not the first accusations of non-compliance within the Han’s Café network. The South Perth restaurant was investigated as part of the National Compliance Monitoring campaign, after the FWO identified issues at other restaurants in the Han’s Café franchise network.

Underpayment

The FWO investigation revealed that the Han’s Café franchisee had paid waiters hourly rates of between $16.39 and $19. The figure fell significantly short of ordinary rates the workers were entitled to.

Under the Restaurant Industry Award, waiters are entitled to ordinary hourly rates including casual loading of $24.41 on weekdays, $29.30 on weekends and $48.83 on public holidays.

Following the investigation, the company admitted that it breached workplace laws, with Mr Sayoco also offering to issue a letter of apology to each underpaid worker.

Han’s Café franchisee enforceable undertaking

Sandra Parker, Fair Work Ombudsman said a court-enforceable undertaking was appropriate as the Han’s Café franchisee had cooperated with the investigation and committed to back-paying employees.

“Under the court-enforceable undertaking, the company will improve its payroll process and undertake external audits to ensure that staff are receiving their correct entitlements, which will particularly benefit young or migrant workers who are unaware of their rights at work,” Parker said.

“The Fair Work Ombudsman is cracking down on underpayments in the fast food, restaurant and café sector, which is over-represented in our disputes. We will continue to take enforcement action to ensure that hospitality workers receive all of their lawful entitlements.”

Under the enforceable undertaking, the company must engage independent auditors to check that all employees receive their correct entitlements, and rectify any errors, in 2019 and 2020.

Additionally, the Han’s Café franchisee will make a gesture of contrition through a $2,000 payment to the Commonwealth Government’s Consolidated Revenue Fund.