Twelve Cupcakes co-founder Jaime Teo admits to underpaying 7 foreign employees for 3 years

• Former actress Jaime Teo was charged with the offences alongside her ex-husband Daniel Ong
• The seven employees they underpaid are still owed a total of S$98,900 in salaries
• The prosecution is seeking a fine of S$80,000 while her lawyers asked for a S$20,000 fine
• She will return to court later in February

SINGAPORE — One of the founders of homegrown bakery chain Twelve Cupcakes, former actress Jaime Teo, pleaded guilty on Thursday (Feb 4) to her role in underpaying seven foreign employees for more than three years.

Teo, 43, was charged in December last year alongside her ex-husband and former radio deejay Daniel Ong Ming Ru. 

The couple, who divorced in 2016 after nine years of marriage, set up Twelve Cupcakes in 2011 before selling it in 2017 to Indian tea company Dhunseri Group for S$2.5 million.

Last month, the firm was fined S$119,500 for underpaying eight foreign employees from 2017 to 2019.

Some of the workers that were underpaid under Teo’s and Ong’s purview continued to be underpaid under its new owners.

Teo, who was crowned Miss Singapore Universe in 2001, pleaded guilty on Thursday to 10 counts of contravening rules under the Employment of Foreign Manpower Act, including charges of failing to pay their foreign employees on time.

As one of the directors and main decision-makers of the firm, Teo had committed the offences over a span of three years and two months — between September 2012 and December 2016.

She and Ong were responsible for their employees’ salaries and were signatories on the company’s account.

The couple had jointly decided in 2012 to hire foreign manpower in order to expand their family-owned business and agreed on the relevant salary ranges.

The underpaid employees were supposed to be paid between S$2,000 and S$2,600 a month, but consistently received less than that. 

Four of them were customer service executives, two of them were sales executives and one was a pastry chef.

One of the sales executives was supposed to be paid S$2,600 every month but received either S$1,200 or S$1,400 over about a year.

All of them held S passes, which are given by the Manpower Ministry to mid-level, skilled foreign workers who earn at least S$2,500 a month.

Teo had failed to prevent the underpayment and made no restitution for the S$98,900 in outstanding salary arrears.

TEO 'LEFT THINGS TO OTHER DIRECTORS'

The Ministry of Manpower's prosecutor Maximilian Chew sought a fine of S$80,000 while Teo’s lawyers, Mr Sunil Sudheesan and Ms Diana Ngiam, asked for a S$20,000 fine.

Mr Chew argued that there were serious consequences arising from Teo’s negligence and it had resulted in substantial financial gains for Twelve Cupcakes. The offences were also difficult to detect and were uncovered only in December 2018, two years after Teo and Ong sold the company.

“It was purely fortuitous that the company continued the (underpayment practice) under its new management, if not they would have gotten off scot-free,” Mr Chew added.

In mitigation, Mr Sudheesan told the court that Teo and Ong ran into difficulties when they began expanding their business. The firm’s human resources director hired a third-party employment agency to help out.

Teo, who handled product development and marketing, did not deal with operations or human resources or administrative matters, the lawyer said. This was left to the other three directors.

“Specifically, she was not involved in discussions with regard to employment details. She did agree with the decision of what the salary ranges should be but she did not have any sort of substantial contact with the third-party agency,” he added.

When she received papers to sign, she was also told that they would all be for administrative purposes.

District Judge Adam Nakhoda will consider another 14 similar charges for sentencing. 

Teo will return to court on Feb 25, while Ong’s case is still pending before the courts.

For each charge of contravening foreign work pass rules, Teo could be fined up to S$5,000 or S$10,000 or jailed up to six months or a year, or both.