Endota Spa franchisee backpays $65,000

Endota Spa Chatswood (Source: Endota Spa)

An Endota Spa franchisee who operates six of the company’s Sydney day spas has back-paid $65,939.87 to 13 employees after making illegal deductions from their salary and underpaying penalty rates and annual leave entitlements.

The Fair Work Ombudsman (FWO) investigated Sea One North Pty Ltd, trading as Endota Spa Sydney, after it received requests for assistance from two skilled 457 visa holders, who alleged the company was making deductions from their pay to cover visa-related costs.

Fair Work inspectors found that the company made unlawful deductions totalling $58,025 from the pay of thirteen 457 visa workers from countries including Poland, Ireland, Britain and Japan between May 2014 and February 2018.

Endota Spa Sydney and Sea One North director Chris Barbour deducted $250 per fortnight from the workers’ pay until the cost (up to $7000)  of each workers’ visa sponsorship had been reached.

The FWO also failed to pay workers $7,914.87 in penalty rates and annual leave entitlements.

According to the FWO, the company has back-paid all workers in full for the unlawful deductions and underpayments, and has co-operated fully with FWO throughout the investigation process.

Fair Work Ombudsman Sandra Parker said deducting pay from workers’ salary was only allowed in limited circumstances and must be principally for their benefit.

“Businesses can’t use deductions from workers’ salaries as a bargaining chip to keep them employed in the business,” she said.

“Endota Spa and Mr Barbour have acknowledged their conduct breached the law and we will keep a close eye on their conduct moving forward to ensure they’re meeting their obligations under workplace laws.”

Parkre said the “significant back-payment bill should also serve as a warning to all employers that it is not acceptable to underpay migrant workers, or make unlawful deductions.

“Employers who do this will get caught”.

Under the FWO’s court-enforceable undertaking (EU), the Endota Spa Sydney will also implement audits this year and next across its six spas  ‒ Martin Place (Sydney),  Four Seasons (Sydney), Crows Nest, Paddington,  Rozelle and Chatswood ‒ to ensure all its employees (around 80) are receiving their correct entitlements.

In addition the company will have to ensure all its managers complete workplace relations training, and will also make a contrition payment of $10,000 to the Commonwealth Government’s Consolidated Revenue Fund.

Endota Spa Sydney is a franchisee of Endota (No 1) Pty Ltd, trading as Endota Spa, which employs over 1000 workers in over 100 spas.

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