A New South Wales restaurateur has been ordered to compensate two international workers almost $200,000 after he was found to have significantly underpaid the men in a major contravention of the Fair Work Act.
Vaisakh Usha and his company, Namitha Nakul Pty Ltd, were sued by Indian national Midhun Basi and Pakistani national Syed Haider for breaches of the Act.
The men, both 35, claimed they were underpaid while working as chefs for Mr Usha's Adithya Kerala restaurants in Wollongong and Nowra between 2016 and 2018.
The men said they were forced to work up to 70 hours a week and also accused their former employer of threatening their sponsorship on multiple occasions if they did not help cover the cost of their 457 visas.
On Thursday, Federal Court justice John Halley ordered Mr Usha and his company remunerate the men a total of $193,953.89 in unpaid wages and superannuation, and also pay them penalties of $100,000 each.
Justice Halley said while Messrs Basi and Haider had failed to establish their claims of working "12 hours a day, six days a week", the proven breaches of the Act were blatant.
"The applicants have established that the respondents engaged in egregious and flagrant contraventions of civil penalty provisions of the Act," he said in his judgement.
"I have concluded that the payment of penalties should be made in equal amounts to each applicant because the seriousness and extent of the contraventions on the applicants was broadly equivalent."
Mr Usha and his company sought to pay the men in instalments of $1,000 a month but Justice Halley denied the request.
"I accept that the respondents may have limited financial resources, but impecuniosity is not a basis on which penalties may be foregone or instalment plans of inordinate length might be permitted," the justice said.
"If the penalties were to be paid at a rate of $1,000 per month, it would take more than 16 years for them to be paid in full.
"Allowing that period of time, particularly with no suggestion of any interest being paid to reflect reductions in the real value of those amounts in future years, would substantially undermine any deterrence that might otherwise have been achieved by the imposition of the penalties."
WorkLawyers principal Kristian Bolwell, who ran the men's legal case pro bono with barrister Lisa Doust, said it was a "massive result".
"So each client is looking at around $190,000 to be paid by an employer that has systematically and holistically ripped off both Mr Basi and Mr Haider from the day they started working for him," he said.
But Mr Bolwell said he was not confident the men would receive the money and called for the Commonwealth to look closely at the case.
"It really brings into focus a need for the federal government to create a scheme to compensate people, particularly vulnerable migrant workers, that are ripped off by unscrupulous employers."
Mr Bolwell said the case should send a strong message to other employers.
"If employers want to rip off employees, they've got to run the gauntlet of these very significant penalties having to be paid.
"So there's a really big incentive now for employers to comply with the law and pay their staff correctly."