Master franchisor faces court for alleged underpayment of workers

The head Australian company and master franchisor of the Yogurberry frozen yoghurt chain faces legal action for allegedly short changing young overseas workers thousands of dollars.  

Four employees at the frozen yoghurt chain were allegedly underpaid almost $18,000.  The watchdog today announced court proceedings against YBF Australia Pty Ltd, the master franchisor of Yogurberry in Australia located in World Square Shopping Centre in the Sydney CBD.

Also facing legal action is YBF Australia part-owner Soon Ok Oh, Yogurberry World Square Pty Ltd and another Yogurberry Group company, CL Group Pty Ltd.

According to the Fair Work Ombudsman, the backpackers were paid just $8 an hour for up to six hours training, before being paid flat rates as low as $11 an hour. The Korean nationals, two of them aged 19 and 20 at the time, were in Australia on 417 working holiday visas.

Under the Fast Food Industry Award, they should have been paid between $14.82 and $18.52 an hour for ordinary hours. Alleged individual underpayments range from $1926 to $6380.

The Fair Work Ombudsman claims the four employees were collectively underpaid a total of $17,827 between July, 2014 and May last year. Workplace laws relating to minimum shifts, classifications, record-keeping and pay-slips were allegedly also contravened.

The employees have now been back-paid all entitlements, except for superannuation still owing to two workers.

The Fair Work Ombudsman has investigated a number of underpayment allegations dating back to 2013. The watchdog has previously issued YBF Australia with a letter of caution and two infringement notices (on-the-spot fines) and requested the company back-pay a number of employees.

YBF Australia Pty Ltd, Yogurberry World Square Pty Ltd and CL Group Pty Ltd each face penalties of between $25,500 and $51,000 per contravention. Ms Soon Ok Oh faces maximum penalties ranging from $5100 to $10,200 per contravention.

The Fair Work Ombudsman is seeking a court order requiring the companies to commission a professional external audit of all Yogurberry stores in Australia next year and to rectify any underpayments found.

A directions hearing is scheduled for the Federal Court in Sydney on July 26.