Two months after The Fair Work Ombudsman begun action against Yuxuan Group, which operated "Fun Tea" outlets on Gouger Street, York Street and Rundle Mall, the company has entered liquidation, leaving the underpaid workforce high and dry and out of pocket hundreds of thousands of dollars.
On the 19th of November the directors of Yuxuan Group Pty Ltd placed the company into liquidation, avoiding court action by appointing the liquidators themselves.
The FWO commenced action against the company for underpaying more than 20 employees $186,000 in September. Since that action commenced, a number of workers continued to report having not received wages; some for up to 7 weeks. Workers also report being paid part time hourly-rates despite being casual employees and entitled to a casual loading.
While employees are considered priority creditors to have their entitlements paid from the liquidation of company assets, that doesn’t necessarily mean they’ll get paid what they’re owed. In circumstances typical of hospitality industry liquidations – there’s not much to sell and not much hope workers will get what they’re owed.
This comes as the final report from the Select Committee into Wage Theft in South Australia is handed down in parliament, which has found wage theft to be pervasive across SA, particularly among vulnerable cohorts of workers and those in casualised and in insecure work.
Quotes attributed to SA Unions Secretary Dale Beasley:
“These FunTea employees are the latest victims of a profitable wage theft business model, which has spread throughout many South Australian workplaces."
“We have a situation where our laws are not strong enough. Wage thieves are able to shut the doors and walk away, leaving their victims out of pocket, high and dry, with little chance of getting what they're owed."
“Far too often workers miss out on the wages that were stolen from them when an employer liquidates the company. For insecure workers, missing out on what they’re owed could mean slipping into poverty, becoming homeless, unable to support their families – and we know that’s a cycle that is difficult to break out of."
“We need immediate and serious action on wage theft here in South Australia. We need expanded powers for our courts and tribunals to deal with phoenixing and sham contract arrangements, Including power to pursue the individuals responsible."
“And once and for all we need to make it a criminal offence for an employer to dishonestly, deliberately and systematically steal the wages of an employee.“
All Media Enquiries: Dale Beasley – 8379 2222