Crown restaurant owes workers millions

by Mia Chapman Last Updated
Crown restaurant owes workers millions

Dinner by Heston, the high-end restaurant fronted by celebrity chef Heston Blumenthal, owes employees at least $4.5 million in what appears to be the worst case of underpayment yet in the high-end restaurant sector.

The Sydney Morning Herald reports that while the eatery was racking up debts to its employees, Crown Casino was paying $1.97 million a year in licensing fees for the restaurant’s intellectual property.

A creditors’ report obtained by The Age and Sydney Morning Herald highlights the consistent underpayment of works from the time Dinner by Heston opened at Crown in 2015 and the significant role the casino had in the initial engagement of those staff.

The creditors’ report suggests Crown was in effect in a joint venture with the company that owned the restaurant, Tipsy Cake.

A Crown employee had set up the “blueprint” for how the majority of staff were initially engaged, the report said.

Crown was not, though, involved in the ongoing payment of workers.

The blueprint was “applied over several years and resulted in the underpayment of employee wages,” the report said.

Crown also provided the business with significant backing including interest free loans.

The daily takings of the restaurant were deposited into a Crown bank account, with Crown charging the restaurant just $1 a year rent.

Crown also paid a multimillion-dollar licensing fee to Bacon and Egg Ice Cream Limited, a company related to Tipsy Cake.

Tipsy Cake is based in the Caribbean tax haven of Nevis and information about its ownership is hidden.

A Crown spokeswoman said in a statement that Tipsy Cake “was a tenant of Crown”, which was “responsible for its own operations and employed its own staff.”

“Tipsy Cake has asked the court to appoint a liquidator, on the basis that it is insolvent. In these circumstances, Crown has taken steps to bring the tenancy to an end. As the winding-up application is now before the court, Crown will not be making any further comment concerning the liquidator’s appointment,” the spokeswoman said.

Last Friday, Crown said it would “provide assistance to Tipsy Cake employees looking for employment within Crown.”

Underpayments exposed in 2018

The wage underpayments were exposed in late 2018 by a Sunday Age investigation that also revealed the company behind the restaurants was set up in the notorious Caribbean tax haven.

Provisional liquidators BRI Ferrier say in the creditors’ report that the $4.47 million owed to works at Dinner by Heston is “in reality” understated by an “unknown factor” because it was an ongoing process to calculate what they were owed.

It covers the restaurant’s four years of operation and includes at least $4.044 million in historic underpayments and $435,000 in accrued entitlements related to the closing of the business.

United Workers Union national president Joanne Schofield said Crown had been complicit in the “shocking exploitation of workers on its premises.”

“Despite wage theft in the order of $4.5 million, Crown continued backing Dinner by Heston through a cosy joint venture that saw them pay rent of only $1 a year. Meanwhile, hospitality workers are owed up to $35,000, after working 80- to 90-hour weeks,” she said.

Tipsy Cake appointed provisional liquidators before Christmas.

It came just days after it missed a deadline with the Fair Work Ombudsman to pay staff the millions it owed to them.

Back to top