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The operators of a retail outlet in Melbourne have been penalised more than $120,000 for underpaying three shop assistants.

Something Aussie Pty Ltd has been penalised $101,400 and its sole director, Mr Kuan Kok Kan, a further $20,280 in the Federal Circuit Court in Melbourne following legal action by the Fair Work Ombudsman.

Something Aussie and Mr Kan paid the employees flat rates as low as $16 and $17 an hour, underpaying their minimum hourly rates, weekend and public holiday penalty rates and casual loadings as prescribed by the General Retail Industry Award 2010.

In her judgment, Judge Norah Hartnett said the penalty should deter other employers in the retail industry from engaging workers at illegally low flat rates.

“There is clearly a need for general deterrence in this case in the sense that other employers do not adopt a flat hourly rate of pay in the retail industry.”

The business also failed to engage the employees for minimum shifts of three hours per day, failed to provide adequate meal breaks and failed to pay one of the employees her annual leave and leave loading on termination of employment.

The contraventions resulted in underpayments of approximately $30,000 for each employee, resulting in a collective underpayment of $91,238.

The underpayments were fully rectified by the business in December 2015.

Judge Hartnett recognised that relevant information about workplace laws was readily available to Mr Kan, should he have chosen to read it.