A BRISBANE Coffee Club franchisee is facing court for allegedly forcing an overseas worker to pay back $18,000 in wages in cash.
The Fair Work Ombudsman has commenced legal action against Saandeep Chokhani, who owns and runs the Coffee Club at Nundah Village Shopping Centre, and his company Gaura Nitai Pty Ltd.
The watchdog alleges Mr Chokhani underpaid an Indian national in his late 20s who was sponsored to work as a cook on a 457 skilled worker visa.
The worker, who approached the Ombudsman for help after his employment was terminated without notice in November 2015, was promised an annual salary of $53,900, but was paid “significantly less” and went for long periods without being paid at all.
The FWO alleges that in 2015, after paying the worker $19,334 by electronic transfer for one four-month period the previous year, Mr Chokhani then told the worker to withdraw $18,000 in cash and repay it to him or his 457 visa would be cancelled.
The worker withdrew $18,000 in cash the same day and repaid it to Mr Chokhani. Overall, it is alleged the worker was underpaid a total of $23,546 between September 2013 and November 2015, which has now been back-paid in full.
Mr Chokhani faces maximum penalties of up to $10,800 per contravention and Gaura Nitai Pty Ltd faces penalties of up to $54,000 per contravention, with a penalty hearing scheduled for the Federal Circuit Court in Brisbane on 2 June.
The FWO has recently instituted proceedings against a number of business for similar “cashback” arrangements, including cafes in Sydney and the Gold Coast.
“It is hard to see a legitimate reason why an employer would require employees to be regularly paying back significant parts of their wage,” Fair Work Ombudsman Natalie James said.
I am concerned that cashback schemes are being utilised by unscrupulous operators in an attempt to get around record keeping laws and disguise serious underpayment of wages. We welcome the government’s commitment to strengthen laws to explicitly cover cashback arrangements.”