Crown pulls the pin on Dinner by Heston
World-renowned chef Heston Blumenthal’s scandal-plagued Australian restaurant appears doomed after its landlord and financial broker, Crown Casino, said it had moved to terminate its lease.
The company behind the Dinner by Heston restaurant appointed provisional liquidators before Christmas, the Sydney Morning Herald reports.
It came just days after it missed a deadline with the Fair Work Ombudsman to pay back staff the millions it owed them for underpayment.
In a statement, Crown said due to the appointment of the provisional liquidator “it has taken action” to terminate the lease of restaurant owner Tipsy Cake Pty Limited.
“While this is disappointing, Crown is working to provide assistance to Tipsy Cake employees looking for employment within Crown,” a Crown spokeswoman said.
“The provisional liquidator of Tipsy Cake, however, will need to deal with employee matters at the first instance.”
In December 2018, a Sunday Age investigation revealed that Dinner by Heston was dramatically underpaying staff and Tipsy Cake, the company that owned the restaurant, was based in a notorious tax haven.
The investigation revealed chefs at the Southbank eatery regularly worked 25 hours of unpaid overtime a week.
That pushed pay down to as little as $15 to $17 an hour, well below the minimum rates of the award, the wages safety net.
The Fair Work Ombudsman soon after launched an investigation.
The spokeswoman said Crown would allow customers who purchased Dinner by Heston gift cards to exchange them for Crown gift cards.
No timeframe was provided by Crown on when the lease of one of its high-profile tenants would end.
The move to terminate the lease creates further uncertainty for employees who had hoped that Crown may financially support the restaurant to keep it open.
Crown had provided the business – one of its marquee tenants – with a $750,000 interest free loan.
Industry sources said the interest free loan could have been used as a way to lure such a high profile business to the casino, boosting its appeal to visitors.
Before Christmas, Fair Work Ombudsman Sandra Parker said it was disappointing that Tipsy Cake had not resolved the underpayment issue before it went into provisional liquidation.
“Tipsy Cake was are that a significant amount of wages and entitlements were owing to many workers who had been underpaid,” Ms Parker said.
Provisional liquidators BRI Ferrier did not respond to a request for comment this week.
Employees are a priority
A case management hearing for the winding up will be heard on Monday in Sydney.
Under Australian law, employees are treated as priority creditors in a liquidation and the government can pay for some unpaid entitlements if the business cannot do so.
Accounts for the Dinner by Heston restaurant show it reported persistent losses since opening in Melbourne in 2015.
The accounts disclosed it was dependent on interest free loans from a related company run through a Caribbean tax haven and Crown Melbourne “to continue operating.”
But its opaque structure – restaurant owner Tipsy Cake is based on the volcanic Caribbean island of Nevis – made it hard to determine the true health of the business.
The ownership of companies incorporated in Nevis is never disclosed so there is no way to know who is behind the companies created there.
But the company has said Blumenthal sold his shareholding more than a decade ago but remained its chef patron and “integral” to its operation.
Blumenthal, a regular on Masterchef Australia, is famed for his “multi-sensory” cooking and unusual food pairings such as bacon and egg ice cream.
The Michelin-starred UK-based The Fat Duck, the eatery for which he is best known, was voted the world’s best restaurant in 2005.