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Underpaying backpackers leads to $100,000 in fines

legal court judgment ruling

Almost $100,00 in penalties has been handed down to a Cairns businessman and his tour company after he was found guilty of underpaying five backpackers.

The Brisbane Federal Circuit Court has fined Leigh Alan Jorgensen $12,000, his company Trek North Tours $55,000, and has ordered his company to back-pay the workers a total of $29,956 in underpaid wages and entitlements.

The five underpaid workers, aged between 23 and 32, were employed under 417 working holiday visas. The court found that the underpayments had occurred between August 2013 and April 2014, when they were working as tour desk agents at three Trek North Tours centres in Cairns.

Rates paid were found to be as low as $10 and $16.37 an hour, under the $17.98 required for normal hours and the maximum of $39.56 for shifts involving penalty rates.

The Fair Work Ombudsman said they attempted to resolve the issue without heading into legal proceedings, but Jorgensen failed to cooperate. After issuing Jorgensen and his company three Compliance Notices and a Notice to Produce documents, he told Fair Work inspectors they would “not get a cent” and denied even having employed three of the underpaid backpackers.

“We made extensive efforts to resolve the matter without going to court, but we were ultimately left with no option but to commence litigation to recover the money owing to these workers,” Fair Work Ombudsman Natalie James said.

“The Court’s decision in this matter shows that employers who refuse to promptly rectify underpayments of workers can face significant fines in addition to back-payment orders.”