21 November 2023

'One of Australia's worst cases of wage theft and worker abuse': Belconnen massage therapists underpaid and exploited

| Lizzie Waymouth
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Business in Belconnen

Canberra Foot and Thai could face penalties totalling $1.4 million. Image: Google Maps.

The Fair Work Ombudsman is seeking more than a million dollars in fines from a Belconnen massage parlour that underpaid its workers and threatened to send them back to the Philippines or arrange to kill their families if they made a complaint about their conditions.

However, the United Workers Union said the penalties fail to reflect the seriousness of the offences, which it described as “one of Australia’s worst cases of wage theft and worker abuse”.

Canberra Foot and Thai, which is now in liquidation, could be facing fines totalling $1.4 million.

The Fair Work Ombudsman is seeking $1.1 million from the business, $222,780 from director Colin Kenneth Elvin and $41,160 from manager Jun Millard Puerto.

The seven workers are still yet to see a dollar of the approximately $900,000 they are owed five years after the case was first launched.

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In 2021, the Federal Court found the business breached the Fair Work Act in its treatment of seven massage therapists on temporary work visas.

Court documents said the massage therapists were contracted to work 38 hours over five days but, on average, worked 67.5 to 70 hours per week over six days. Some workers said their employer told them not to record their actual work hours.

Each of the workers gave evidence that they were required to pay the business $800 per fortnight for about eight months because the shop was not getting enough income and customers.

Several massage therapists gave evidence that they were not allowed to leave the Higgins residence where they stayed without their employer unlocking the gate, and they could not go out at night. They also said he confiscated their passports on arrival at the residence. One worker said she was told, “If you try to leave, I will send you back to the Philippines”.

According to the judgment, Mr Elvin and Mr Puerto threatened to kill the workers’ families, with Mr Puerto telling some of the workers, “If you ever talk about your salary or the work you’re doing in the shop, I will get someone in the Philippines to kill your family”.

In a joint statement, Delo Be Isugan and Mayet Ortega, two former massage therapists, said: “We came here because we believed Australia could offer us a better life. Instead, we experienced frightening, inhumane treatment. We regained our voices, but no one should have to experience what we went through or how long we have waited for justice.”

UWU National President Jo Schofield said the financial penalties do not reflect what these women went through, and even though the company is now in liquidation, there is little chance they will get the recognition they deserve.

“The financial penalties facing these directors do not reflect the extent of their wage theft offending,” Ms Schofield said.

“The current cumbersome mechanism has taken five years before these women receive any recognition of the full amounts owed for what is one of Australia’s worst cases of wage theft. Even now, with the company in liquidation, there is scant likelihood they will see a cent.”

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The UWU said the Closing Loopholes Bill currently before Parliament would better protect workers against wage theft by introducing new criminal provisions for intentional wage theft and greater civil penalties for breaches of the Fair Work Act.

Under the legislation, wage theft would result in a $1.6 million fine for individuals and $7.8 million for corporations or fines of three times the underpayment amount, if that is greater. Individuals involved could also face up to 10 years’ imprisonment.

Fines available for individuals would also be lifted from $187,800 to $939,000 for serious contraventions or $18,780 to $93,600 otherwise. Companies could be fined by a court five times these amounts.

Crossbench senators Jacqui Lambie and David Pocock have brought forward their own proposed legislation for workers’ safety, breaking elements of the Closing Loopholes Bill into four separate bills.

However, the UWU says this case shows change is needed immediately to protect workers, and the Closing Loopholes Bill needs to be passed in its entirety.

“These brave women stood together to overcome their fears of reprisal, threats of deportation and even threats to their families’ lives to join their union and make their voices heard. It shouldn’t be so hard for workers in Australia to hold employers to account. Their story demonstrates that the system is broken and that change is urgently needed,” Ms Schofield said.

“We are disappointed Senator David Pocock has failed to support the [bill] in its entirety to better address wage theft and implement other measures to protect workers. Business has too much power, while workers continue to suffer. It is time for Senator Pocock to listen closely to the most vulnerable in his community.”

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When ABC Canberra ran this story, they were at pains to emphasise that there are new owners of this establishment and that they have nothing to do with this issue. If that is a fact then RIOTACT has been been negligent in not making that point as well.

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