Australia’s Fair Work Ombudsman has secured a fine against a Sydney-based Hong Kong-owned company in court over deliberately and systematically underpaying migrant employees.

The Federal Court has imposed an AUD 550,000 (USD 350,333) penalty against Winit (AU) Trade Pty Ltd, a Hong Kong-owned company that provides warehousing and distribution services in Sydney for products sold on online platforms, including eBay.

In addition, the court has imposed an AUD 8,190 (USD 5,216) penalty against the company’s sole director and general manager at the time of the contraventions, Song Cheng. Cheng was involved in Winit’s contraventions concerning overtime rates, penalty rates and frequency of pay. Serious contraventions were not alleged against Cheng, the regulator added.

Between 2014 and 2019, Winit underpaid nearly 400 employees, most from migrant backgrounds, a total of more than AUD 3.6 million (USD 2.29 million).

The Fair Work Ombudsman’s litigation against Winit focused on a sample of 30 migrant employees who were underpaid a total of AUD 368,684 (USD 234,859) under the Services and Wholesale Award 2010 between July 2017 and June 2018.

Three of the underpayment contraventions met the definition of ‘serious contraventions’ under the Protecting Vulnerable Workers laws because of the deliberate and systematic conduct. Under the Protecting Vulnerable Workers laws, the maximum penalties for serious contraventions are 10-times the penalties which would ordinarily apply.

Fair Work Ombudsman Anna Booth said the penalties imposed demonstrate that employers who exploit migrant workers in Australia will face serious consequences.

The Ombudsman investigated Winit after receiving requests for assistance from several employees. The 30 underpaid employees involved in the Ombudsman’s legal action were all working-holiday-visa holders, mostly from Taiwan and aged in their 20s, who performed various duties associated with sorting, loading and packing goods at Winit’s warehouse at Regents Park in western Sydney.

The employees regularly worked up to 60 to 70 hours per week over six or seven days, but most were paid a flat hourly rate of AUD 24.41 (USD 15.55) with no penalty or overtime entitlements that were owed under the Services and Wholesale Award 2010.

Winit also failed to comply with laws relating to pay slips, providing new employees with a Fair Work Information Statement, and various other Award obligations, including shift allowances, meal allowances and frequency of pay.

Justice John Snaden described Winit’s underpayment contraventions as “troubling”, particularly the serious contraventions, which he described as ‘deliberate and systematic’.

All 30 employees have now been back-paid in full. Winit also back-paid the large majority of other employees underpaid between 2014 and 2019 after engaging an external auditor.