Two Subway franchisees face court

The operators of two Subway outlets in Adelaide are set to face court for allegedly underpaying former employees.

According to the Fair Work Ombudsman, franchisees Hutt Nominees Pty Ltd and McNeill Investments Pty Ltd, and Jason Matthew Hood, a director of both companies, were involved in the underpayments of three employees for various periods between August 2017 and October 2019.

Two of the employees were reportedly aged 17 and 18 at that time.

The Fair Work inspector determined that the employees were underpaid entitlements under the Fast Food Industry Award 2010, including minimum rates for ordinary hours, casual loadings, penalties, a special clothing allowance and annual leave entitlements on termination of employment.

As a result, three Compliance Notices were issued to Hutt Nominees and one to McNeill Investments in September 2020. However, the respondents, without reasonable excuse, failed to comply with the Compliance Notices, which required them to calculate and back-pay the workers’ outstanding entitlements.

McNeill Investments was also alleged to have breached workplace law by failing to comply with a Notice to Produce records or documents issued by a Fair Work Inspector in October 2019.

“Where employers do not respond to or comply with these Notices, we will take appropriate enforcement action to protect employees,” Fair Work Ombudsman, Sandra Parker, said.

“A court can order a business to pay penalties for not complying with such a Notice, in addition to back-paying workers as appropriate.”

McNeill Investments and Hutt Nominees face maximum potential penalties of $33,300 and Hood faces a potential penalty of up to $6,660. In relation to the alleged Notice to Produce breach, McNeill Investments faces a maximum potential penalty of $63,000.

The FWO is also seeking a court order for the companies to take the action required by the Compliance Notices, including calculating and rectifying underpayments in full for the employees, plus superannuation.

A directions hearing is listed in the Federal Circuit Court in Adelaide on 24 May 2021.

This article was first published on Inside Small Business, a sibling website to Inside Franchise Business Executive.