Wage theft has once again hit the headlines, with the operator of four The Ironing Shop franchised outlets in Brisbane facing allegations of migrant worker exploitation.

On Friday, the Fair Work Ombudsman (FWO) commenced legal action against Yuyin Luo and Shujing Huo, along with their company ANS.HL Trading Pty Ltd (ANS.HL), which offers services such as ironing, dry cleaning, clothing repairs and clothing alterations.

The regulator is alleging that the operators paid a Chinese national wages as low as $8 an hour and falsified records. Initially, the worker was paid the $8 flat rate, later increasing to $12 an hour over a two-year period from 2015 to 2017.

This allegedly resulted in underpayment totalling $28,404. Specifically, the alleged contraventions of the Dry Cleaning and Laundry Industry Award 2010 related to ordinary hourly rates, casual loadings, overtime rates and Saturday penalties she was entitled to.

The worker, employed across all four of the franchisees’ The Ironing Shop outlets at Teneriffe, Kangaroo Point, Norman Park and Ascot was in Australia on student and bridging visas.

Sandra Parker, Fair Work Ombudsman said wage theft and the exploitation of migrant workers was a serious concern.

“The alleged payment of low, flat rates that undercut Award entitlements is completely unacceptable conduct and we treat underpayment of visa holders particularly seriously,” Parker said.

“Enforcing compliance with workplace laws in the franchising sector continues to be a priority for the Fair Work Ombudsman. Employers in this sector are on notice that they must pay all employees according to Australia’s lawful minimum pay rates.”

Wage theft and workplace law

In addition to the alleged wage theft, Luo, Huo and ANS.HL are also accused of falsifying documents.

The FWO is alleging that ANS.HL breached workplace laws related to frequency of payment, falsifying records, making and keeping records and issuing pay slips. Both Luo and Hou are accused of being involved in each of the company’s contraventions.

If proven in Federal Circuit Court, the franchisees face penalties of up to $12,600 per contravention, with ANS.HL up to $63,000 per contravention.

“Employers should be aware that the Fair Work Ombudsman takes allegations of false and misleading records extremely seriously,” Parker said. “Any employees with concerns about false records or pay slips should contact us for assistance.”

A directions hearing is listed in the Federal Circuit Court in Brisbane on 20 December 2019