Dinner by Heston blame Crown for staff underpayment

By Charlotte Lee Updated
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The owners of the Dinner by Heston restaurant in Melbourne have directly blamed Crown Resorts for its role in an underpayment scandal at the high-end eatery, saying the casino company was more than simply a landlord, it was a “partner” in the failed business.

Sydney Morning Herald reports that the restaurant, which is fronted by world-renowned chef Heston Blumenthal, will not trade beyond this Friday night after it went into provisional liquidation, owing employees more than $4 million from underpayment and more than $400,000 in entitlements.

It is expected to be put into liquidation by the Federal Court this week.

The British-based arm of Dinner by Heston, a company called Tipsy Cake, released a statement to The Age and Sydney Morning Herald saying Crown was significantly involved int he underpayment scandal that has led to the imminent demise of the restaurant, and ignored attempts to address the problem.

Crown disputes the claims.

“As a foreign company, Tipsy relied from the outset on the advice given by advisers in Australia and our partner Crown Melbourne, who were responsible for advising on the staff remuneration blueprint for the restaurant,” a Tipsy Cake spokesperson said.

“As the financial effect became clearer, including the discovery that there were also significant overpayments of superannuation to some staff, Tipsy Cake tried to discuss constructively with Crown, to work together to find a solution which would be in the best interests of staff.

“Regrettably Crown has not engaged with us or agreed to any proposal which was tabled in order to remediate the employees,” the statement says.

“This is a complex issue and one that has affected a large number of industries and companies across Australia.”

Tipsy Cake is based in the Caribbean tax haven of Nevis and is said not to have the resources to pay its employees what it owes them.

Blumenthal is no longer a shareholder in the business and restaurants that bear his name, though the company itself says he remains linked as chef patron and is “integral” to their operation.

He is paid by another part of the empire, the British-based Fat Duck Group.

Crown allegedly a partner in restaurant

The company’s insistence that Crown was a “partner” in the business rather than just a landlord reflects comments made in a creditors report by BRI Ferrier, which revealed Crown had offered a range of financial and administrative support to Dinner by Heston.

BRI Ferrier said the arrangement was “best described as a joint venture”.

A Crown spokeswoman disputed the claims, saying Tipsy Cake, trading as Dinner by Heston, was “a tenant of Crown. It 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.”

Crown was charging the restaurant owner just $1 a year in rent while paying $1.97 million a year in licence fees to an obscure Irish entity that is related to a sprawling global network of companies that own the Blumenthal-fronted restaurants.

The problems for Dinner by Heston emerged after a Sunday Age investigation in late 2018 showed the Melbourne eatery had been significantly and unlawfully underpaying their staff, many of whom worked 20 to 30 hours a week unpaid.

What appears to have hastened the end of Dinner by Heston’s Australian experiment was a subsequent investigation by the Fair Work Ombudsman and demands the restaurant repay staff.

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