Watchdog Should Have Prosecuted Company For Worker Abuse

The federal workplace watchdog has been criticised for not prosecuting a Taiwanese company that brought Chinese workers into Australia, paid them no wages for months and left them to live on a $15-a-day "food allowance".

AFR, by Ewin Hannan, 22 April 2015

Taiwanese company Chia Tung Development underpaid 13 Chinese and 30 Filipino workers more than $873,000 for labour performed in regional NSW over six months to February this year. Chia Tung employs more than 4000 staff globally and has associated entities registered within Australia.

The construction union said on Wednesday that the company should have been prosecuted given the extent of the abuse perpetrated on the workers.

The workers, who installed animal feed mills at sites in Narrabri, Manildra and Bomaderry, were employed as welders, metal fabricators and electricians and generally worked between nine and 11 hours a day, six days a week.

Chia Tung employed the Filipino men on 457 skilled worker visas and the Chinese, who spoke no English, were on temporary short-stay work visas.

The Chinese employees were promised about $10 an hour but were paid no wages for three months and only received a $15 a day 'food allowance'.

Almost 30 workers lived in a five-bedroom house with one toilet at Nowra, with nine sleeping in the living room. At Narrabri, six workers lived in a worksite office, while four lived in an onsite demountable.

Chia Tung unlawfully deducted fees for visa processing, flights, insurance, food and transport from the wages of the Filipino workers.

Despite the severity of the offences and the level of underpayment, the Ombudsman did not try to prosecute Chia Tung through the courts but opted to seek an enforceable undertaking from the company, arguing it achieved outcomes that would not have been possible through litigation.

But Construction, Forestry, Mining and Energy Union national secretary Michael O'Connor said on Wednesday that the Ombudsman should have taken court action.

Mr O'Connor said ``more needs to be done to bring the company to account and achieve justice for the workers".

``Given the extent of the abuses the company perpetrated against these vulnerable workers, the mere recovery of wages was not enough," he said.

"A prosecution by the Fair Work Ombudsman would act as a deterrent to others who think that paying workers $15 dollars a day, forcing them to live in offices and shipping containers and docking their wages for migration fees is a good idea."

He said the Department of Immigration should also explain what it intended to do about the ``abuses of the temporary work visa system".

`` How much abuse do workers have to cop before an employer is no longer allowed to bring in temporary overseas labour?" he asked.

Chia Tung has back paid the Filipino workers in full and agreed to backpay the Chinese workers in full by next week.

Chia Tung will donate $10,000 to the Philippine-Australian Community Services support organisation, issue written apologies to the underpaid workers, and place notices in newspapers and at the three work sites outlining its contraventions.

The company will also pay for external audits of its pay practices over the next 18 months, provide compliance reports to the ombudsman, require managers to undertake workplace training, and ensure its subsidiary companies and transferees comply with their workplace obligations.

"The EU with Chia Tung secured large back-payments for underpaid workers, as well as other measures focused on ensuring ongoing compliance, that would not have been possible through court action, which could have taken a year or more," Acting Fair Work Ombudsman Michael Campbell said.

Mr Campbell said the underpaid Chinese workers had now returned home, while 20 of the Filipino workers were still employed by Chia Tung in Australia.

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