Australia’s two chief workplace and tax regulators have carried out surprise inspections across Darwin’s food and hospitality sector, targeting suspected shadow economy activity including worker exploitation and alcohol excise avoidance.
Between 26 and 28 August, Australian Taxation Office (ATO) and Fair Work Ombudsman (FWO) officers visited more than 30 fast food outlets, restaurants and cafés as part of Operation Sentinel, a joint-agency effort driven by the Shadow Economy Taskforce.
“We’ve visited more than 30 businesses this week in Darwin who were suspected of unlawfully taking advantage of their workers and / or avoiding their tax and super obligations,” ATO Assistant Commissioner Tony Goding said.
The regulators said the blitz drew on community intelligence and tip-offs, including from workers, and aimed to remind businesses of their tax (including excise), superannuation and employer obligations. Investigations are continuing.
“If you run a business, don’t think you can get away with exploiting your workers or ripping off the community, as we have a range of sophisticated methods to uncover shadow economy activities. We also work closely with our partner agencies like the FWO to catch those doing the wrong thing.”
“Cooking the books by ripping off your workers and dodging your tax and super obligations doesn’t pass the pub test. Businesses that engage in the shadow economy are deliberately undercutting their competitors, gaining an unfair advantage over honest businesses doing the right thing and stealing from their employees’ futures. We will find out about it and take action.”
“There are serious consequences for non-compliance including fines and penalties for businesses that engage in shadow economy behaviours at the expense of their employees,” Mr Goding said.
Targets of the Darwin operation included businesses suspected of paying staff cash-in-hand to avoid legal obligations, underpaying wages and superannuation, under-reporting or omitting income, failing to meet payslip and record-keeping requirements, and avoiding alcohol excise.
Operation Sentinel also placed venues on notice over alcohol duty obligations. “Some businesses who deal with alcoholic beverages evade their excise and GST obligations by operating outside the law. This allows them to undercut legitimate businesses, creating unfair competition and posing risks to public safety,” Mr Goding said. Alleged tactics include manufacturing alcohol without permission, underreporting production, selling untaxed product and structuring operations to circumvent the $350,000 annual excise remission limit.
The ATO urged the public to report suspected tax evasion or shadow economy activity at www.ato.gov.au/tipoff. “When we receive information through a tip-off, we cross check the information and assess whether further action is required,” Mr Goding said.
Fair Work Ombudsman Anna Booth said the food sector remains a priority for enforcement. “Improving compliance in the fast food, restaurants and cafés industry is a priority for us, including protecting the sector’s many visa holders and young workers who can be vulnerable.”
“The Operation Sentinel investigations in Darwin are part of our efforts to ensure those who are doing the wrong thing are being found out and held to account.”
“Fast food, restaurant and café workers with concerns about their pay or entitlements are urged to come forward to directly seek our assistance. They can report issues anonymously if they prefer,” Ms Booth said.
The FWO pointed employers and workers to its industry-specific guidance, including pay tools and resources for small businesses, and reiterated that visa holders have the same workplace rights as other employees.
