Fair Work Ombudsman slams Tokyo Sushi over staff rip-off

A judge has slapped an Australian sushi chain with huge fines after “vulnerable” staff were ripped off by tens of thousands of dollars.

A judge has slammed the operators of a popular sushi chain that underpaid its workers, saying there was “no excuse” for exploiting vulnerable staff.

The bosses of three Tokyo Sushi outlets were ordered to pay a combined penalty of $383,616 after the Fair Work Ombudsman found workers had been ripped off by more than $70,000.

The Federal Circuit Court slapped Kiyoshi Hasegawa a $63,936 penalty after 31 workers in stores in Newcastle and the NSW Central Coast were exploited in 2016.

Two companies owned by Ms Hasegawa and her family — Hasegawa & Ye International Pty Ltd and Heiwa International Pty Ltd — were also fined $150,120 and $169,560 respectively.

Ms Hasegawa and the companies admitted to underpaying 16 staffers a total of $48,318 over six months across two stores within the Erina Fair shopping centre near Gosford in NSW.

Another 15 employees from Fletcher in Newcastle were also underpaid by $22,567 in eight months.

The court heard many of the affected workers were visa holders while eight were juniors, with one Central Coast staff member aged just 17, while seven in Newcastle were aged from 16 to 20.

Fair Work Ombudsman Sandra Parker said inspectors had discovered the rort after auditing dozens of sushi outlets across Canberra, Queensland and regional NSW.

“Young migrant workers can be particularly vulnerable to exploitation if they are reluctant to complain due to visa concerns or unaware of their workplace rights,” she said.

“The Fair Work Ombudsman takes the blatant underpayment of vulnerable workers particularly seriously, which has been supported by the court’s substantial penalty.

“Inspectors will continue to conduct targeted audits across the fast food, restaurant and cafe sector, and we will hold employers accountable if they are not meeting their lawful obligations. We encourage any workers with concerns about their pay to contact the Fair Work Ombudsman for free advice and assistance.”

Two of the outlets were located in the NSW Central Coasts’s Erina Fair shopping centre. Picture: Sue Graham/AAP Image

The Tokyo Sushi outlets were in breach of the Fast Food Industry Award 2010, with workers instead paid hourly rates on weekdays ranging between $9 and $19 at the Newcastle outlets and between $10 and $19 at the Central Coast store, plus an additional 25 per cent on Saturdays and an additional 50 per cent on Sundays.

It meant some staff missed out on minimum weekday rates, casual loadings and penalty rates for weekend and public holiday work.

The companies also broke rules regarding superannuation entitlements and record keeping.

Judge Philip Dowdy said there was “no excuse” for the “serious” breaches.

“The simple fact of the matter is that persons who engage in business activities which necessitate the employment of staff are under a strict obligation to pay their staff the just entitlements of the staff in accordance with law, whether the relevant employer is a major corporation or, as here, a family business,” Judge Dowdy said.

“Employees are entitled to respect and part of that respect is to pay them their full entitlements, which must be recognised and known to the employer.”

Most of the underpayments have been rectified, but the court has ordered Ms Hasegawa, Hasegawa & Ye International Pty Ltd and Heiwa International Pty Ltd to back-pay the final outstanding amounts to employees within 28 days.

However, it appears exploitation within sushi outlets is rife across the country.

Just last year, a NSW sushi outlet and the company’s accountant were fined almost $200,000 over an illegal internship program that operated at the Masaki sushi outlet at the Stockland Shellharbour Shopping Centre on the NSW South Coast.

In 2017, the owner of a Gold Coast Japanese restaurant was penalised $284,000 for paying his international workers as little as $8 an hour.

And in 2015, a Herald Sun investigation revealed a number of Melbourne restaurants were ripping off foreign workers and international students, sometimes paying them with nothing more than sushi, while others received just $7 an hour.

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