$30,000 fine for Donut King franchisee who deliberately underpaid disempowered employees
3rd November, 2008
The Federal Magistrates Court has ordered the operator of a Donut King outlet to pay $30,000 in penalties for deliberately underpaying ten casual employees, most of them under-21, by $9,000.
The franchisee, who ran the outlet at the Cranbourne Centro shopping centre in Melbourne, failed to pay weekend, public holiday and shift penalty rates, as well as overtime and annual leave, to the casuals, who were as young as 15. Federal Magistrate Philip Burchardt noted the workers were "not empowered stand-alone negotiators".
He found that a total penalty of $43,000 should be levied for the unlawful conduct, but said imposing a penalty exceeding $40,000 on "somewhat marginal business operation" would be "crushing", and reduced the penalty to $30,000.
However, he refused to suspend the operation of any part of the penalties, because of the deliberate breaches by the franchisee.
