Subway franchisee 'exploits employee' for $14.60 an hour

Owner of two Subway stores will face court over allegations she "exploited" a worker. Photo / News.com.au

A Subway franchisee is due to face court for allegedly exploiting a Chinese employee who was underpaid more than AU$16,000 (NZ$16,700).

Danmin "Irene" Zhang owns two of the fast food outlets in Artarmon and Stanmore in Sydney where the worker was allegedly paid about AU$4 (NZ$4.18) below the minimum hourly rate.

The Chinese woman aged in her late 20s, who was working with a skilled visa, lodged a complaint to the Fair Work Ombudsman.

On Friday, the employment watchdog said it had commenced legal action in the Federal Circuit Court against Ms Zhang and the company she owns with her husband, G & Z United.

The exploited employee was paid a flat rate of between AU$14 (NZ14.60) and AU$14.50 (NZ$15.50) for all hours worked and did not receive entitlements to ordinary hourly rates and penalty rates, it alleges.

A special clothing allowance was also allegedly underpaid and the company is accused of breaking several laws relating to record-keeping, pay slips and contract information.

Fair Work Ombudsman Natalie James has urged brands such as Subway to work closely with franchisees to limit the exploitation of vulnerable overseas workers.

"We are always willing to work with any franchise ready to take action to show it takes compliance with workplace laws throughout its network seriously," she said in a statement on Friday.

Zhang and her company face combined penalties of nearly AU$65,000 (NZ$68,000). The worker was back-paid in full earlier this year.