Melbourne-based travel services company Grandcity Travel & Tour faces legal action after paying a young migrant consultant as little as $9 an hour.
The Fair Work Ombudsman claims the company and its owner, Na Xu, contravened contracting laws between January and September last year when they told a 24-year-old Chinese migrant she was an independent contract worker running her own business.
Grandcity allegedly made the worker, whose identity has not been disclosed, sign a contractor agreement that would allow them to pay her between $9 and $11 per hour.
It is alleged the employee is owed a total of $16,756 as a result of being underpaid, with the Fair Work Ombudsman arguing they should have been classified as an employee, not a contractor.
According to the Ombudsman, Ms Xu was aware of her company’s obligation to meet the minimum wage requirements set out in Australian law.
This isn’t the first time Ms Xu has found herself in hot water with Fair Work Australia. Last year she was issued a written warning in relation to another worker – also a young Chinese immigrant – allegedly being misclassified as a contractor.
Fair Work Ombudsman Natalie James said the FWA’s previous contact with Ms Xu, the failure to rectify the most recent alleged underpayment and the involvement of a young, vulnerable worker were significant factors in the decision to commence legal action.
“We will be alleging in court that Grandcity has not changed its business practices despite having been put on notice previously of the need to comply with workplace laws,” Ms James said in a statement.
A directions hearing is set for October 27, with Grandcity facing penalties of up to $51,000 per breach while Ms Xu faces maximum penalties of $10,200 per contravention.
Grandcity Tours declined the opportunity to comment when contacted by City Journal.
