Celebrity chef George Calombaris’ hospitality group has been found to have underpaid more than 500 staff at his restaurants by a total sum of nearly $8 million.
The Fair Work Ombudsman has fined the MasterChef Australia judge and his MAde Establishment company $200,000, in what it terms a “contrition payment”.
Calombaris must implement new payroll and compliance systems across his stable of restaurants that include Hellenic Republic, Gazi and Jimmy Grants.
MAde backpaid workers more than $7.83 million to 515 current or former employees of Melbourne restaurants Press Club, Gazi and Hellenic Republic for work between 2011 and 2017, after entering into the court-enforceable undertaking.
A further $16,371 was back-paid to nine employees of his other restaurant brand, Jimmy Grants.
The amounts are considerably higher than initially indicated, following Calombaris’ estimate of $2.6 million, when MAde announced that 162 workers had been underpaid $2.6 million because of “historically poor processes”.
MAde founder and director, Calombaris, apologised to all former and current staff affected.
“We apologise to all our affected team members, past and present – as it is our people that make our restaurants great, and it is our priority to ensure all of our employees feel respected, rewarded and supported in their roles,” he said.
“We are committed to acting as a force for change in the industry and leading by example when it comes to building and promoting supportive, healthy and compliant hospitality workplaces.”
However lawyer Oahn Tran, who had represented MAdE employees, told ABC Radio Melbourne the $200,000 payment was not enough.
“$200,000 of 7.8 million is a piddling percentage of what was taken from workers throughout the time that Calombaris was employing them,” she said.
“It can potentially become a cost of doing business, you can say ‘how long can I get away with it and what am I going to be hit with; potentially just a slap on the wrist’.”
Other groups were similarly unimpressed by the extent of the punishment, including Unions NSW, who called on MasterChef Australia to drop Calombaris from its roster.
Hey @masterchefau, we know you don’t support chefs ripping off their workers, and that you would never endorse a chef underpaying their staff millions of dollars. So why is Calombaris on your payroll?
It’s time to drop the Masterthief from Masterchef. https://t.co/BlKmzGNbzU
— Unions NSW (@unionsnsw) July 18, 2019
Fair Work Ombudsman Sandra Parker said the enforceable undertaking commits the group to stringent measures to ensure current and future employees across the restaurant group are paid correctly.
Calombaris also must do speaking engagements to educate the restaurant industry on the importance of complying with workplace laws, as part of the undertaking.
“MAde’s massive back-payment bill should serve as a warning to all employers that if they don’t get workplace compliance right from the beginning, they can spend years cleaning up the mess,” Ms Parker said.
Fair Work inspectors investigated the MAde group of companies after it self-reported underpayments at Press Club and Gazi restaurants in Melbourne’s CBD and Hellenic Republic restaurants in Kew, Williamstown and Brunswick.
The investigation expanded to include some restaurants operated by Jimmy Grants Pty Ltd, a company which shares common shareholders and directors with the Made group of companies.
Inspectors found significant underpayments occurred because staff were wrongly classified and there were incorrect processes and failures across its payroll and human resources systems.
The Melbourne-based company said it identified incorrect payments during a review in early 2017, following a change in ownership and management.
MAde group CEO, Leigh Small, said all current team members were correctly classified and new procedures were in place.
“Since changing ownership, we have introduced a new CEO, a new People and Culture Director and new processes and procedures to ensure we’re not only complying with workplace relations laws, but actively promoting a culture of employee wellbeing,” he said.
The company must fund external auditors to check pay and conditions for workers across the group every year until 2022.