SINGAPORE: Homegrown bakery chain Twelve Cupcakes' co-founder Jaime Teo was fined S$65,000 on Tuesday (Mar 9) for underpaying foreign workers when she helmed the company with her then-husband Daniel Ong.
Teo, a local celebrity and former Miss Universe Singapore, allowed Twelve Cupcakes to underpay seven foreign employees who worked at the bakery over three years almost S$100,000. She was a director of the firm at the time.
District Judge Adam Nakhoda said the offences were difficult to detect and persisted for a period of time.
"The fact that the accused herself was unable to detect the offences is not in itself mitigating," he said. "She ought to have paid more attention to the HR (human resources) aspect of the business."
He said the workers were on an unequal bargaining position with the company, as they wanted to work in Singapore and might be agreeable to accepting lower salaries, but stressed that "it is incumbent on companies that they are paid minimum salaries".
"The fact that employees do not complain that they are being paid less does not absolve the companies," he added.
He said that Teo had not made restitution, in contrast to Twelve Cupcakes as a corporate offender, which made full restitution to underpaid employees under its new owners.
Earlier this month, Teo pleaded guilty to 10 charges under the Employment of Foreign Manpower Act.
The court heard that Teo was one of the main decision makers in the company, controlling the company's expenses and in charge of the employees' salaries, as she and Ong were signatories to the company's financial accounts.
Teo failed to prevent the company from underpaying the workers, and did not take any steps to ensure that they received their fixed monthly salaries, the court heard.
Among the workers were a pastry chef, customer service executives and sales executives who were hired to expand the business after it began operations in 2011. They were owed salaries of between S$2,000 and S$2,600, but were given between S$350 and S$1,400 less between September 2013 and November 2016, according to court documents.
Teo and Ong, a former radio deejay, sold the company to India-based Dhunseri Group after the couple divorced in 2016.
A tip-off about the bakery chain's new owners' underpaying practices led to the discovery of Teo's offences.
Ministry of Manpower prosecutor Maximilian Chew had asked for a fine of S$80,000 for Teo, saying that the offences resulted in "substantial financial gains" in the illegal cost savings of salaries. Her conduct was not a one-off incident but "a continuous lapse".
He also said that the amounts paid to the employees were below that of the minimum salary requirements for an S pass worker at the time.
Teo’s lawyer Sunil Sudheesan asked for a S$20,000 fine instead, saying that her role in the firm was in marketing and product development.
"There was a third-party employment agency hired by the HR director. Naturally, the accused was asked about it and she just agreed, because she left issues to others," he said.
He added that Teo was not involved in discussions about employment details. While she did agree on the salary ranges, she did not have "any sort of substantial contact with the third-party agency", he said.
He also said that Teo has "certainly" learnt her lesson. "She has no intention of being a director in any company," he said.
However, Mr Chew said that it is "disingenuous" to suggest that Teo "went with the flow".
Ong’s case is pending, and he is expected to return to court at a later date.
For contravening work pass conditions, Teo could have been jailed for up to a year, fined up to S$10,000, or both per charge.
Additional reporting by Lydia Lam