$630,000 per breach; Former franchisee facing monster fines for alleged repeated exploitation

By Nick Hall | 07 Jan 2020 View comments

A former Han’s Café franchisee from Western Australia has become the state’s first to face legal action under the ‘serious contraventions’ provisions of the Protecting Vulnerable Workers laws.

Former Perth franchisee Tac Pham Pty Ltd, along with former general manager Cuc Thi Thu Pham allegedly underpaid 11 vulnerable workers, including a number of young and migrant workers – a total of $5,022 between October 2017 and April 2018 at its Rockingham outlet.

However, it’s the shocking disregard for workplace law that has seen Pham and her company come under fire. The franchisee’s alleged underpayments come despite having previously faced court for similar conduct.

Serious contraventions

According to the Fair Work Ombudsman, two of the alleged contraventions relating to pay slips and underpayment of minimum wages – meet the definition of ‘serious contraventions’ under the Protecting Vulnerable Laws because of the alleged repeat offending.

Under the laws, which came into effect in September 2017, the maximum penalties for serious contraventions are $630,000 per breach for a company and $126,000 for an individual, 10-times the penalties which would ordinarily apply.

It is the third matter nationally, and the first in WA that the Fair Work Ombudsman has commenced legal action under the provision, which were brought in following community concerns about worker exploitation in Australia.

“Employers are on notice that the Fair Work Ombudsman is making full use of the Protecting Vulnerable Workers laws to ensure that any individuals or companies who commit serious contraventions are held to account,” Sandra Parker, Fair Work Ombudsman said.

Han’s Café franchisee failings

It isn’t the first time the Han’s Café franchisee has faced legal action. Last year, the Fair Work Ombudsman secured a total of $45,000 in penalties in court against Tac Pham Pty Ltd and Ms Pham last year in relation to pay slip laws breaches.

Between December 2014 and December 2015, 22 staff were underpaid $27,920 at the Han’s Café Rockingham outlet.

According to reports, Fair Work Ombudsman inspectors allegedly discovered the breaches during an auditing campaign.

Aside from the alleged ‘serious contraventions’ penalties, Tac Pham Pty Ltd faces penalties of up to $63,000 per contravention for other alleged contraventions and Pham faces penalties of up to $12,600 per contravention for other alleged contraventions.

The matter is set to hit Federal Circuit Court in Perth on 13 February, 2020.