Editor's Blog

A Melbourne based businessman and his two companies have been penalised for the deliberate exploitation of vulnerable overseas workers after the Federal Circuit Court found that they had underpaid two overseas workers who had a limited understanding of employment laws and their entitlements.

Pradeep Gaur and his two North Melbourne-based IT companies - Konsulteq Pty Ltd and Konsulteq Upskilling & Training Services Pty Ltd were penalised $160,000 for various breaches of the employment law in connection with the two overseas workers.

Each of the workers paid Gaur up-front “training fees” of more than $2000 that they understood would lead to jobs with Gaur’s companies - but the workers were not provided with accredited training and were not provided with properly paid employment.

Gaur also misclassified one employee as a contractor and then paid her less than half of her lawful minimum entitlements over a 15-month period in 2010-2011, leading to a total underpayment of $16,571. Gaur then breached the adverse action provisions of workplace laws by terminating her employment after she continued to complain about her pay.

The other worker, who was also misclassified, was paid nothing for several days of work she performed when Gaur deemed she was volunteering “to get local work experience”.

Judge Riethmuller said Gaur had stated he was ready to rectify underpayments but never did and Gaur’s companies’ books were not consistent with his evidence that he could not afford to pay debts.

“Worse still, he attempted to de-register the companies during the proceedings (stating there were no proceedings pending); hoping this would resolve his problems...The attempt to deregister the companies exhibits a desire to avoid having to take corrective action. The conduct of the respondents show there is no remorse or contrition in this case.”Judge Riethmuller said.

Fair Work Ombudsman Natalie James says deliberate exploitation of vulnerable overseas workers is extremely serious conduct that will not be tolerated.

“The penalties should serve as a warning to the minority of Australian employers who seek to exploit overseas workers that serious consequences apply if they are caught. Minimum wage rates apply to all employees in Australia – including visa-holders – and they are not negotiable,” ,” Ms James said.