Monday, 13 November 2017 09:09

A sponsored HR manager who processed underpayments of almost $600,000 to 85 Chinese restaurant staff and then helped falsify records for the FWO has been fined $21,760, the Federal Court dismissing arguments that cultural factors, family connections and a lack of formal qualifications mitigated her culpability.

In a win for the FWO's push on accessorial liability, the HR manager's penalty formed part of a total of $525,057 in fines imposed on NSH North Pty Ltd (New Shanghai Charlestown), its sole director/shareholder and the restaurant's manager for failure to pay minimum rates and entitlements over a 16-month period between July 2013 and November 2014.

Justice Robert Bromwich found that after the FWO requested time and wage records in September 2014 company director Zhong Yuan 'John' Chen directed the HR manager to "create various documents, including purported time and wage records and pay slips for 28 employees", which were then provided to the FWO.

The company later supplied the correct records.

The HR manager – a 457 visa holder who originally came to Australia as part of PricewaterhouseCoopers' graduate recruitment program before being employed by Chen on a $100,000 salary – told the court that defiance of the boss by a junior employee is not tolerated in Chinese culture.

She also suggested that it would bring shame on her family if she was disrespectful to Chen, who was a family friend, and that she was mindful her residential visa status was dependent on her continuing employment with the related company for which she worked, NSH Restaurant Pty Limited.

Justice Bromwich observed that, in the first instance, it was "plain" that, despite claims she had no qualifications or formal training in HR management, "she had sufficient training or capacity to carry out the directions given to her in her role, including the creation of false records".

Before then, she had not taken any steps to ensure that the Lake Macquarie-based restaurant paid correct hourly rates, casual loading, weekend penalty rates, public holiday penalty rates or overtime, contributing to staff being short-changed a total of $583,688.

Justice Bromwich noted that the HR manager submitted that she was "in a parallel position of vulnerability to that of many of the employees of New Shanghai Charlestown by reason that she was also from a non-English speaking background and also working in Australia on a 457 visa, that visa being conditional upon employment and sponsorship by NSH Restaurant Pty Limited".

"However, the comparison is not apt.

"A distinction must be drawn between vulnerability to being exploited, which is a position of victimhood, and supposed vulnerability by way of reduced ability to resist participation in illegal activity, which is a position of participation."

Justice Bromwich imposed penalties of $54,672 on Chen, and $18,496 on the restaurant manager.

Source: Fair Work Ombudsman Media Release 9 November 2017

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