The Fair Work Ombudsman has launched legal action in the Federal Court against Hutt Nominees – the franchisee of the Jetty Road Subway – and McNeill Investments – the franchisee of the Bayside Village Shopping Centre Subway.
It has also taken action against Adelaide man Jason Hood, who is a director of both companies.
In a statement, Fair Work said it took action after sending three compliance notices to Hutt Nominees and one to McNeill Investments in September for allegedly underpaying three staff members – two of whom were 17 and 18 years old when they started working at the outlets – between August 2017 and October 2019.
The regulator investigated the outlets following requests for assistance from the three former employees.
It said among the underpayments, it believed the former staff were owed casual loadings, penalties and annual leave entitlements.
Fair Work Ombudsman Sandra Parker said the industrial relations body had made several attempts to contact the businesses before taking legal action.
“Where employers do not respond to or comply with these notices, we will take appropriate enforcement action to protect employees,” she 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.
“Any employees with concerns about their pay or entitlements should contact us for free assistance.”
McNeill Investments faces penalties of up to $96,300 in relation to compliance and notice to produce breaches, while Hutt Nominees could be fined a maximum of $33,300 for non-compliance and Hood hit with a penalty of up to $6660.
A Subway spokesperson said the fast food chain did not support deliberate wage theft and was supporting the investigation.
She said the two outlets were under new ownership, with the franchisees no longer involved in the case.
“All Subway franchisees are required to comply with Australian workplace laws and Subway’s own high standards of operation. Failure to do so results in enforcement action by Subway, including possible termination of a franchise agreement,” she said.
“Subway provides a workplace hotline for restaurant workers to report any concerns about their employment, including underpayment.”
A directions hearing is listed for May 24.
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