Sydney accounting firm fined $177,000 over unlawful cashback scheme involving migrant worker
Accounting and financial services company and its owner penalised after worker was required to return money covering her wages, tax and superannuation
1 September 2026
A Sydney accounting and financial services company and its sole owner have been ordered to pay a combined $177,000 in penalties after a migrant worker was required to provide money that was subsequently used to cover her wages, tax and superannuation obligations under an unlawful cashback arrangement.
The Fair Work Ombudsman (FWO) secured the penalties against Innovative Associates Pty Ltd and its sole director and owner, Mr. Dila Ram Kharel, following proceedings in the Federal Circuit and Family Court of Australia.
The court imposed a $148,000 penalty on Innovative Associates and a further $29,000 penalty on Mr Kharel.
The case involved a worker who was employed part-time as an assistant accountant between July 2019 and December 2020. She was a Nepalese national and was on a temporary graduate visa at the time.
Worker initially received no wages
According to the Fair Work Ombudsman, Innovative Associates failed to pay the worker any wages for approximately the first 10 weeks of her employment.
The company then required the worker to pay amounts to Mr Kharel or Innovative Associates that were sufficient to cover not only her wages, but also associated tax and superannuation obligations.
The arrangement involved the worker transferring money into bank accounts held in Mr Kharel’s name, or accounts he controlled or had access to.
Mr Kharel would then transfer the money into Innovative Associates’ bank account. The company subsequently used those funds to pay the worker’s wages and meet PAYG withholding and superannuation obligations.
The FWO described the arrangement as an exploitative cashback scheme.
More than $32,000 transferred
Between October 2019 and December 2020, the worker was required to transfer a total of $32,907 into Mr Kharel’s bank accounts.
Innovative Associates subsequently returned $27,873.50 to the worker as wages.
The FWO said the arrangement meant the worker effectively received no wages from the company for the work she performed because the money used to fund those payments had first been provided by the worker herself.
The worker was legally entitled to be paid in accordance with Australia’s minimum wage requirements.
More than $40,000 in total underpayments
The cashback arrangement was not the only workplace law breach identified in the case.
Innovative Associates also breached record-keeping and payslip requirements. The company knowingly provided a Fair Work Inspector with false or misleading payslips.
The company also failed to pay the worker for public holidays when she was entitled to be absent from work.
In addition, the company failed to pay her accrued but untaken annual leave entitlement when her employment ended.
Taking all of the contraventions into account, including the cashback arrangement, unpaid wages and other employment entitlements, the company underpaid the worker a total of $40,164.49.
The FWO said the company has since back-paid the worker in full. Mr Kharel was found to have been involved in all of Innovative Associates’ contraventions.
Court finds conduct was deliberate
Judge Gillian Eldershaw found that the contraventions were deliberate.
The court also noted that Innovative Associates and Mr Kharel had provided false and misleading information to a Fair Work Inspector.
Judge Eldershaw noted that approximately two years passed after the Fair Work Ombudsman commenced its investigation before the company and Mr Kharel began taking steps to rectify the contraventions.
The judge considered the financial circumstances of the worker and the impact of being denied her lawful employment entitlements.
The court found there was a clear need for penalties to deter both Innovative Associates and Mr Kharel from future breaches, particularly given their disregard for their workplace obligations.
The penalties were also intended to send a broader message to employers about the consequences of similar conduct.
Judge Eldershaw said it was important that the penalty send a strong signal to the community that the conduct was an unacceptable way to operate a business.
Fair Work Ombudsman warns employers
Fair Work Ombudsman Anna Booth said the case demonstrated the seriousness of exploiting workers through unlawful cashback arrangements.
Ms Booth said the company had implemented the arrangement in a way that gave the appearance that it was meeting its legal wage obligations, while in reality exploiting a vulnerable migrant worker for its own benefit.
She described unlawful cashback schemes as one of the most blatant forms of workplace exploitation and said the FWO was committed to holding those responsible to account.
Ms Booth also emphasised that protecting potentially vulnerable workers, including visa holders, was among the FWO’s priorities.
“All employees in Australia are entitled to receive – and keep – the minimum lawful entitlements that apply to their employment position, regardless of their visa status,” Ms Booth said.
She also warned employers against providing false or misleading records to Fair Work inspectors.
Protections apply regardless of visa status
The case highlights that migrant and temporary visa workers remain protected by Australian workplace laws.
The Fair Work Ombudsman encourages visa holders and other employees who have concerns about their wages or employment entitlements to seek free advice and assistance.
Workers can contact the Fair Work Ombudsman or their union if they are union members.
The FWO said its investigation in this case began after the worker lodged a request for assistance.
The agency also reported that, in the eight financial years to June 2025, it had filed 171 litigations against employers involving visa-holder workers and secured $39 million in penalties in cases that included visa-holder workers.
The FWO also reported filing 88 litigations involving alleged accessories in the two years to June 2025, securing more than $5.14 million in penalties against accessories over the same period.
Source:
Fair Work Ombudsman — “Accounting and financial services company penalised for unlawful cashback scheme”, 1 September 2026.
