'Deliberate wrongdoing': Din Tai Fung, executives fined $4 million for underpaying employees

Taiwanese restaurant Din Tai Fung and two of its former officials have been fined over $4 million for "deliberately" underpaying employees and providing false records during the investigation.

The Federal Court fined DTF World Square with $1.99 million. It employed workers at Din Tai Fung restaurants at the World Square shopping centre in the Sydney CBD, Chatswood, and Emporium shopping centre in the Melbourne CBD.

It also fined Selden Farlane Lachlan Investments Pty Ltd with $1.89 million. It employed the workers at the Emporium store.

Among the executives fined by the Federal Court is the former HR coordinator of DTF World Square, Sinthiana Parmenas, who was fined $105,084.

The other executive involved is Hannah Handoko, former general manager of DTF World Square, who was fined $92,232.

Justice Anna Katzmann said they "deliberately deprived the employees of their legislated entitlements and contrived to disguise their wrongdoing through the creation of a false set of records."

"It goes without saying that the respondents' conduct was extremely serious. This was not merely deliberate wrongdoing. It was deceitful and unscrupulous. It involved a calculated scheme to rob employees of their hard-earned wages and deceive the authorities," Katzmann said in a statement.

Din Tai Fung's underpayment

Din Tai Fung was found to have underpaid 17 employees, including cooks, waiters, a dishwasher, and restaurant managers, a total of $157,025, according to the Fair Work Ombudsman (FWO).

The underpayments involved 16 employees between November 2017 and June 2018, while the other full-time employee was underpaid from July 2014 to May 2018.

The longest-underpaid staff was deprived $50,588, according to the FWO, while the lowest underpayment was $2,165.

The FWO said DTF World Square and Selden Farlane Lachlan Investments provided false records during the investigation, containing understated hours worked and false rates of pay for the casual employees affected.

Katzmann said Handoko and Parmenas were involved in setting the unlawful pay rates, with the latter aware from the time she started working for DTF Group that the pay slips and records were "false and misleading."

Determining penalties for underpayments

In determining the penalties, the Federal Court considered the deliberate nature of the contraventions, which attract a tenfold increase in applicable maximum penalties.

"It is difficult to conceive of any circumstances in which the introduction and operation of a dishonest scheme to deprive employees of their statutory entitlements to minimum wages or conditions would ever warrant anything but the imposition of substantial penalties," Katzmann said.

The judge also considered the executives' seniority, lack of remorse, and the lack of evidence that any corrective action was carried out at any time.

In addition to paying the fine, the organisations are also ordered to back-pay the underpaid employees in full, plus interest and superannuation.

Fair Work Ombudsman Anna Booth said the penalties were the second-highest secured in FWO's history.

"We welcome these penalties that demonstrate the serious nature of the offending by the respondents in this matter. Their actions resulted in vulnerable migrant workers being underpaid hundreds of thousands of dollars," Booth said in a statement.

She also agreed that underpayment of wages in this case was "extremely serious."

"Serious consequences await any business found to be engaging in such calculated and systemic conduct such as the type uncovered in this matter," Booth said.