Tasmanian cafe owner accused of paying Italian backpacker $1.35 an hour

A Tasmanian businessman has been accused of paying an Italian backpacker less than a $1.35 an hour for working in a store and cafe in Queenstown.

The Fair Work Ombudsman said Harold William Jackson paid the woman $270 for four weeks' work at his hardware store and cafe two years ago.

Ombudsman director Craig Bildstien told ABC radio's AM program it is believed the businessman underpaid four workers a total of almost $43,000.

"We allege that the employer was recruiting working holidaymakers wanting to stay in Australia for a second year, but substantially underpaying their minimum lawful entitlements, and therefore were collectively underpaid almost $43,000," he said.

(Photo : AAP Dan Peled)

A 417 visa allows 18 to 30 year olds from 19 countries to spend a year earning an Australian wage.

If they spend 88 days of that year in a regional area, and in an industry where workers are hard to come by, they are allowed to stay for another year.

"It has reached the courts after efforts were made with the employer to resolve the matter co-operatively, without enforcement action, but we were unable to secure sufficient co-operation," Mr Bildstien said.

The statement of claim accuses Mr Jackson of promising to sign off on the Italian woman's 88-day regional stint requirement in late 2013.

He then allegedly paid her $270 for four weeks' work.

Mr Jackson has declined to comment on the allegations because the matter is still before court.

Mr Bildstien said underpayment was a national issue and penalties were severe.

"We're talking $10,200 for an individual and $51,000 for a company per contravention," Mr Bildstien said.

The Australian Council of Trade Union's president Ged Kearney wants a government inquiry into the 417 visa scheme.

"With the austerity crisis in Europe, the working holiday is no longer that; it's a means for survival for a lot of young people in particular coming from Europe," she said.

"They often don't speak the language, they don't know their rights and they are so exploitable and really, the whole system needs an overhaul."

Source : ABC News    Pat McGrath   January 22nd 2015