Cafe chain 85 Degrees Coffee Australia Pty Ltd has been fined $475,200 by the Federal Court – the second highest penalty of its kind – for exploiting eight students who came to Australia of Taiwan under an agreement entered into by the brand’s parent company.
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The students came to Australia on working holiday visas for the ‘internship’ arrangement, but despite being entitled to minimum wage and overtime rates, annual leave and superannuation, they were each underpaid between $50,213 and $58,248 over a period of just under 12 months. .
Each student was paid between $1,650 and $1,750 a month to work up to 60 to 70 hours a week at 85-degree factories and retail stores in Sydney in what Judge Robert Bromwich deemed a willful abuse of power.
“The end result was undoubtedly exploitation, and the offending conduct itself was clearly deliberate,” Bromwich said.
“The long hours that were not paid for by overtime or penalty rates, longer than other employees, exacerbated the poor living conditions and general amenities brought on by the inability to afford adequate housing.”
The students sounded the alarm to the Fair Work Ombudsman (FWO), which launched legal action last year to ensure workers were reimbursed.
The penalty is the fifth-highest ever imposed in an FWO case and the mediator’s second-highest against a single company.
“The substantial penalty sends a clear message that the exploitative conduct we have seen in this case will not be tolerated in any Australian workplace,” said AFC Sandra Parker.
The students, from Taipei City University of Science and Technology, worked at an 85 Degrees cake factory in St Peters, the 85 Degrees bread factory in Hurstville and the 85 Degrees cafe on George Street in the CBD of Sidney.
Bromwich said the penalties should deter other employers from engaging in similar conduct.
Parker echoed this by stating that “Employers must pay the statutory minimum wage rates that apply to all employees, for all hours worked, regardless of nationality or visa status. a worker”.
“Any workers with concerns about their pay or rights should contact us.”