OTR petrol stations chain ordered to pay underpaid employee $65k

The state’s biggest private employer has been hit with a $65,000 civil penalty after underpaying a former trainee, with a magistrate questioning the company’s pledge to fix a “systematic” failure.

• OTR facing $70m legal claim for underpaying staff
• How to make the most out of your Advertiser subscription

The operator of the OTR chain of petrol stations has been ordered to pay close to $65,000 to a former employee who was underpaid for more than a year.

In an SA Employment Tribunal judgment handed down on Friday, Deputy President Stephen Lieschke described the conduct of Shahin Enterprises as a “deliberate exploitation of a low paid hard working employee”.

The judgment follows a tribunal ruling last year that found OTR failed to pay the former trainee for 10-to-15 minutes of work completed prior to each shift, wrongly deducted 30 minutes for meal breaks he never took, and failed to pay proper overtime penalty rates.

The former trainee – an Indian citizen – was employed by OTR between November 2015 and December 2016 and mostly worked a midnight to 7am shift at the company’s petrol station at Fulham.

“The respondent’s explanations for the contraventions is limited and guarded,” Friday’s judgment says.

OTR has been ordered to pay a former employee $65,000 due to underpayments

“They clearly arose from a series of long-standing decisions of unidentified senior managers that either directly created the circumstances of contravention, or created and formalised a culture of extracting small amounts of daily unpaid work.

“I accept as accurate the applicant’s description of the unpaid work contravention as brazen. It is objectively very serious. It was deliberate exploitation of a low paid hard working employee.”

Deputy President Lieschke described the requirement of unpaid work as “systematic and backed by the possibility of disciplinary action”.

He also called into question media statements made by Shahin Enterprises, in which the company claimed it was committed to ensuring its employees received their entitlements, and would “continue its process of regular review and audit to identify and correct anomalies”.

He cast doubt about the effectiveness of OTR’s fingerprint scanning system which was introduced after the former trainee’s departure from the company.

“There is no demonstrated contrition for this underpayment, or for the applicant having to suffer the indignity of compulsory unpaid work,” he says.

“There has been no change to the system of rostering to cater for the handover duties that must be performed between shifts.

“The system still depends upon individual managers and employees understanding correctly that all handover work performed prior to the nominal shift time is required paid work.

“The new system still leaves potential for uncertainty and different decisions being made about whether handover duties are paid work.

“I accept there have been some changes to the respondent’s time recording system, but the fingerprint scans merely replace time books.”

While last year’s ruling found the former employee had only been underpaid about $2700, Friday’s judgment awarded him $27,000 for the unpaid work completed prior to shifts, or 50 per cent of the maximum civil penalty.

A further $24,300 was awarded for the meal break deductions, while a penalty of $13,500 was awarded for unpaid overtime.

“In my opinion there is a high need to deter this employer from further contraventions regarding unpaid work and proper meal breaks,” the judgment says.

“The weakness of the current system means the respondent remains at risk of lapsing into non-compliance.

“The temptation to profit from individually minor but potentially huge pay errors in aggregate must be warned against by an effective deterrent.

“The penalty should also serve as a deterrent to other employers in the retail industry and generally.”

Shahin Enterprises is currently facing a $70m class action for underpayment of staff.

In May, Adero Law lodged a Federal Court claim, accusing the company of underpaying potentially more than 8000 current and former employees.

An OTR spokesman said: “OTR has received the SA Employment Tribunal’s decision and we are considering our position.

“If any team members have queries about their pay rate or terms and conditions, please contact us so we can investigate.”