Dinner by Heston restaurant at Crown casino found to be underpaying staff
Celebrity chefs planning to set up restaurants in Australia have been put on notice after liquidators revealed Dinner by Heston staff were underpaid more than $4 million in the latest blow to hospitality workers.
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Liquidators of the Heston Blumenthal-fronted Dinner By Heston say the restaurant underpaid staff by more than $4m over three years.
The revelation comes after Crown Melbourne on Friday ousted the trouble-plagued high-end restaurant from its base, giving it 14 days to vacate.
The restaurant’s parent company Tipsy Cake Pty Ltd applied for provisional liquidation on December 19 last year.
The restaurant has been run by provisional liquidators Brian Silvia and David Coyne of BRI Ferrier, after being appointed by the Federal Court.
But their report to creditors shows the depth of the problem, and links it to Melbourne’s larger problem of underpaid restaurant workers.
“The company has quantified amounts totalling $4,044,397 as not having been paid to current employees and former employees for work undertaken between 2015 and 2018 conclusive,” the report says.
“These amounts are underpayments as a result of the company miscalculating entitlements.”
The report also sheds light on the final months of the trouble-plagued business.
In the report, completed on January 31, it claims Crown effectively acted as a “joint venture arrangement” with the restaurant.
The liquidator says it is investigating “who was responsible for the under payment of wages from establishment of business in October 2015” and “the extent of (parent entity Cape Proprietary Pty Ltd) and Crown’s involvement in relation to the management and conduct of the company’s restaurant business”.
It claims Crown provided bookkeeping and accounting services and attended to the payment of the majority of trade creditors.
The liquidators also say they will investigate Crown’s retention of net trading receipts and whether it may constitute a preference payment in its favour.
“We are advised an issue developed some months prior to our appointment, as to Crown’s accounting for net trading receipts,” the report says.
“It has been suggested that, if the company is wound up, Crown may have been in receipt of preference payments.”
The report also says “prior to our appointment, the Company and Crown sought to reach a commercial resolution of issues which existed between the parties, with the intention of generating sufficient funds to satisfy employee arrears payments. These discussions were unsuccessful.”
But Crown today said the restaurant was not a joint venture.
“Tipsy Cake Pty Ltd (trading as Dinner by Heston) was a tenant of Crown and responsible for its own operations and employed its own staff,” the company said in a statement.
“Crown was not in a joint venture arrangement with Tipsy Cake.”
“Tipsy Cake has asked the court to appoint a liquidator, on the basis that it is insolvent.”
“In these circumstances, including ongoing substantial unpaid expenses to Crown, Crown has taken steps to bring the tenancy to an end.”
Crown said it was working to provide assistance to Tipsy Cake employees looking for employment within Crown.
“The Provisional Liquidator of Tipsy Cake, however, will need to deal with employee matters at the first instance.”
“As the winding up application is now before the court, Crown will not be making any further comment concerning the liquidator’s appointment.”
United Workers Union national president Jo-anne Schofield said the case “is a warning to global celebrity chefs wanting to set up shop in Australia”.
“You must abide by our workplace laws, pay your workers correctly and treat them with respect, or you will not be welcome here,” Ms Scholfield said.
The union called on Crown to help pay the workers what they are owed.
“We have requested that Crown repay all unpaid wages and entitlements owed to our members – and offer employment to these members as well as sponsoring those who are on temporary visas.”
Workers today spoke out, voicing their outrage at the underpayments.
“I worked at Dinner by Heston for more than two years. Some weeks we worked more than 80 hours and never worked less than 60 hours. We are owed millions,’’ former Dinner by Heston chef William Trist said.
“It strains relationships when you work such massive hours. And then to get ripped off is the ultimate slap in the face. I feel angry that we’ve been treated like this.
“I think it’s absolutely crazy.”
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Another worker — who is still at Dinner by Heston — who only wanted to be identified as Steve said he was on a temporary visa.
“I am tired of being screwed over by this company. I feel like indentured labour,” he said.
“We were made to work these crazy hours and we’re so terrified of speaking out or standing up for our rights. We were told we were lucky to work 70-80 hours a week. My visa has been hanging in the balance for over six months. My whole life is in Australia. And I face losing it all.”
Crown has also said it will assist customers who have purchased gift cards at Dinner by Heston by enabling them to be exchanged for Crown gift cards.
The Fair Work Ombudsman — which is investigating the underpayments — said it had released records obtained during the course of the investigation under section 718 of the Fair Work Act 2009 to the provisional liquidators.
“(We) will continue to engage with the provisional liquidator to assist affected employees obtain backpay,” a spokesperson said.
“The provisional liquidator has advised that the winding up proceeding is scheduled for a case management hearing on 12 February 2020.”