Subway ex-franchisee fined, ordered to backpay $25,597

Subway ex-franchisee fined
Judge Brown said employers must comply promptly with Compliance Notices. (Source: Bigstock)

A former Subway franchisee will have to backpay staff $25,597 and pay $5,425 in penalties.

Jason Matthew Hood was a director of two companies that formerly operated Subway franchise outlets in Glenelg.

The Federal Circuit and Family Court has imposed the fine after Hood failed to comply with Compliance Notices.

Hood must now back-payment the entitlements to three workers, one of whom is owed $22,247. The three staff members worked at the outlets for various periods between August 2017 and October 2019.

Compliance Notices issued for underpaid entitlements

Fair Work Ombudsman Sandra Parker said company directors must understand they may face penalties.

“When Compliance Notices are not followed, we are prepared to take legal action to ensure workers receive their lawful entitlements,” Parker said.

The FWO issued Compliance Notices in September 2020 for underpaid entitlements under the Fast Food Industry Award 2010. The entitlements included minimum rates, casual loadings, penalties, a special clothing allowance and annual leave entitlements on termination of employment.

Judge Stewart Brown said the nature of the job and hours worked in the fast food industry leave staff vulnerable to exploitation. He said there was a need to impose penalties to deter others from similar conduct.

“The specific objectives of the Compliance Notice system must be supported and a general message sent as to the need for prompt and complete compliance to them,” Judge Brown said.

Recently the former operators of The Coffee Club outlet in Westfield Geelong faced fines of $115,603. The penalties were issued for staff underpayments and falsified employment records. The breaches had continued despite warnings from the FWO, the judge said.

Last year bakery chain 85 Degrees copped a mega fine of $475,000 for exploiting Taiwanese students. The students were on holiday visas working in a “purported internship” arrangement.

  • Franchisors can turn to the FWO website for guidance on workplace laws.