Restaurant owner jailed 90 days, fined for failing to pay staff as ordered

TORONTO — The owner of a now defunct Toronto-area restaurant chain has been jailed for 90 days for failing to comply with a government order to pay former employees wages and other money they were owed.

In addition, Ontario court justice of the peace Karen Walker fined Yuk Yee (Ellen) Pun and the companies behind the Regal restaurant chain $900,000 for the failure.

In one of the largest cases of its kind, Pun and the corporations she controlled breached Ontario employment laws by failing to pay more than 60 employees $676,000 in wages, overtime and other mandatory compensation. In June, 2015, the Ministry of Labour ordered her to pay them more than $457,000.

However, Pun and her companies failed to pay the full amount, prompting Walker to convict them in Newmarket, Ont., this week under the Employment Standards Act. All pleaded guilty to the charges.

Avvy Go, a lawyer with the Chinese and Southeast Asian Legal Clinic in Toronto, said the punishment meted out is not common.

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“It is one of the few cases where the court has imposed a jail sentence on a director of a company for failing to comply with the Employment Standard Act,” Go said in a statement. “This sentence shows the seriousness of the breach committed by Ellen Pun and her companies.”

The Ministry of Labour said the claimants were administrative staff, food services providers and cleaning staff. Many spoke little English and required an interpreter and the legal aid clinic to file their claims.

Between June 2013 and April 2014, the ministry received 68 complaints from employees of the 12 corporate defendants, none of whom is still in business. Each claim involved unpaid wages ranging from a few hundred dollars to as much as $45,000 earned from May 2013 into February of 2014, the ministry said. 

Although the total amount the workers were short-changed was more than $676,000, the ministry could not legally order restitution of more than $457,000 plus an administrative fee. However, Pun paid only $104,800, leading to the court case and sentence.

“It sends a strong message to other employers that they must respect the rights of their employees under the law,” Go said.

The restaurants shut down in 2013, leaving the employees without jobs, weeks or months of back pay, and termination money. In all, 68 individuals filed claims. The initial Labour Ministry order followed a year-long investigation.

Among the dozen corporate entities fined in the case were Ellen’s Health Food, Ellen’s Investment Holding and various numbered companies.

Coincidentally, the Supreme Court of Canada on Thursday refused Pun’s leave to contest her unrelated fraud conviction and 30-month jail sentence. In that case, an Ontario court convicted her after she convinced a doctor to give her $620,000 to buy land but the money vanished and no land was ever purchased.

Colin Perkel, The Canadian Press