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Cafe & Cake chain caught underpaying foreign staff

Cafe chain 85 Degrees has allegedly underpaid Taiwanese students working in its Sydney stores on a supposed internship arrangement.

The FWO alleges that Taiwanese company Comestibles Master Co Ltd, the franchisor of the 85 Degrees café brand in Taiwan, underpaid eight Taiwanese students $429,393 over a period of just under 12 months from July 2016 to June 2017.

It is alleged the employees concerned were students at the Taipei City University of Science and Technology in Taiwan who came to Australia on working-holiday visas under an internship arrangement between Comestibles Master Co Ltd and the University, to work in 85 Degrees factories and retail stores in Sydney operated by 85 Degrees Coffee Australia Pty Ltd.

Between them the students were employed in the St Peters cake factory, at the firm’s bread factory in Hurstville and at the café outlet on George Street in Sydney’s CBD.

It is alleged the employees worked 60 to 70 hours per week, were entitled to be paid the minimum rates and entitlements under the applicable Awards, including minimum wage rates, overtime rates, penalty rates, annual leave entitlements and superannuation, and that each of the employees was underpaid between $50,213 and $58,248.

It is also alleged that 85 Degrees Coffee Australia Pty Ltd contravened a term of an Enforceable Undertaking it entered into with FWO in 2015 in respect of contraventions relating to other Chinese and Taiwanese visa holders.

Fair Work Ombudsman Sandra Parker said “The Fair Work Ombudsman enters into Enforceable Undertakings with a person where it believes that they will fully comply with the terms. Where there are alleged breaches of an Enforceable Undertaking, the FWO will not hesitate to take the business to court.”

Contraventions of record-keeping and pay slip laws are also alleged.

Parker said “All franchisors setting up operations in Australia must abide by our laws and pay the lawful minimum pay rates that apply to all workers, regardless of nationality or visa status,” Parker said.

“The FWO has developed a range of free resources for employers, employees and higher education institutions to promote a clear understanding about what constitutes legitimate unpaid arrangements and vocational arrangements under the Fair Work Act.”

The FWO is seeking a court order requiring the companies to rectify the alleged underpayments in full. Comestibles Masters Co Ltd and 85 Degrees Coffee Australia Pty Ltd face penalties of up to $54,000 per contravention for multiple alleged contraventions of workplace laws.

The eight students were aged between 20 to 22 at the time and spoke little English.

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