More than 140 young workers allegedly underpaid $1.25 million by three Hobart Bakers Delight stores have moved a step closer to recovering their wages following a landmark Federal Court ruling.
The Full Court dismissed an appeal by Bakers Delight Holdings last week, clearing the way for a trial that could see the national franchisor held liable for $642,000 in alleged underpayments.
The 142 affected workers, mostly young people employed at Bakers Delight stores in Kingston, Lindisfarne and Eastlands, were allegedly underpaid between 2017 and 2020.
Some staff allegedly missed out on minimum wages and penalty rates, had money unlawfully deducted from their termination pay and were subject to false record-keeping.
The franchisee that employed them, Make Dough Enterprises – owned by husband-and-wife team John Vince Puglisi and Lisa Kay Puglisi – went into liquidation and closed all three stores in 2023.
According to the Fair Work Ombudsman (FWO), Bakers Delight Holdings became aware Make Dough was underpaying staff in 2019 but failed to act to stop further breaches.
Under laws introduced in 2017 after the 7-Eleven wages scandal, franchisors can be held liable if they have significant control over their franchisees but turn a blind eye to worker exploitation.
The FWO is now pursuing the national company for underpayments that occurred after February 2019, totalling $642,162.
The case will now proceed to trial, where the FWO will seek court orders requiring the franchisor, Make Dough and the Puglisis to repay the alleged underpayments.
The final amounts will include back pay for staff, along with interest, superannuation and penalties for breaching the Fair Work Act.
