Milk bar missteps: costly penalties for ignoring Fair Work Ombudsman rules

The Fair Work Ombudsman has secured over $11,000 in penalties against a Victorian-based hospitality business.
Milk bar missteps: costly penalties for ignoring Fair Work Ombudsman rules

The Fair Work Ombudsman (FWO) has secured over $11,000 in penalties against a Victorian-based hospitality business, The Springs Milkbar, for failing to comply with a Compliance Notice. This case serves as another stern reminder that disregarding directives from the FWO can result in significant repercussions for businesses.

Here, we dive into this case and explain why compliance is imperative for every business regardless of size or industry. Let’s get into it.

What went wrong at The Springs Milkbar?

In December 2021, the FWO commenced legal action against the operators of The Springs Milkbar, Double Hao International Pty Ltd (Double Hao International), and the company director, Rong Liu, for the underpayment of a former employee.

The regulator began its investigation after receiving a request for assistance from a former employee who had worked for the business between March 2018 and November 2022. During this investigation, it was uncovered that the worker had been underpaid minimum casual wages and loadings under the General Retail Industry Award 2010 and the General Retail Industry Award 2020.

After being issued a Compliance Notice, the FWO determined that the operators, without reasonable excuse, failed to comply with the Compliance Notice that required the business to calculate and back-pay the worker’s entitlements in full, plus interest and superannuation.

The Court’s decision

The Federal Circuit and Family Court (the Court) has imposed a $9,990 penalty against the business operated by Double Hao International and a $2,000 penalty against the company director, Rong Liu. Further to these penalties, the Court also ordered that $3,970 of the imposed fine on Double Hao International be paid to the worker which was deemed to be the estimate of the loss suffered by the worker because the business failed to comply with the Compliance Notice.

This decision has again emphasised the regulator’s commitment to enforcing workplace laws and taking legal action where necessary.

Thinking about your workplace compliance? Talk to us

We know that most business owners wouldn’t dream of intentionally committing wage theft or breaching workplace laws, mistakes can and do happen – this is where Citation HR can help you. Our team of workplace relations experts can complete a comprehensive HR compliance audit of your business that helps uncover issues before they become problems – and the best part – this service is included in our monthly, cost-effective subscription that’s designed to protect your business from costly risks.

Not a Citation HR client? To learn more about how Citation HR can support your business and streamline its people management, get in touch with our friendly team for a confidential, no-obligation chat.

Zaynab Aly is a Senior Workplace Relations Consultant at Citation HR. She has a particular interest in the retail industry and regularly provides advice on workplace matters to find solutions for clients.

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