The Federal Circuit Court fined Sydney woman Yan Hu $17,556 – her company Global Express Consultancy Pty Ltd has been penalised a further $87,783 – after she admitted underpaying 19 employees from Taiwan and Hong Kong on 417 working holiday visas a total of more than $45,000.

The Fair Work Ombudsman said Hu paid employees flat rates of $16 to $18 an hour, resulting in underpayment of the minimum hourly award rates, casual loadings, Saturday penalty rates and overtime rates.

Ms Hu also unlawfully deducted bonds of up to $400 from some of the employees' wages, to be returned if they stayed with her company for at least six months and were not "lazy". Laws requiring pay slips were also breached.

Judge Justin Smith found that Ms Hu, who migrated to Australia from China as an international student in 1999, was "very frank".

"I find that Global deliberately sought to engage foreign nationals as employees because of Ms Hu's opinion, which she willingly shared ... that they were 'younger, cheaper and faster than locals who are old and slow'," Judge Smith said.

Ms Hu told an inspector that domestic workers relied on welfare. "The locals just get Centrelink payments. I just pay the market rate, it is business and economics."

Despite paying below award rates, Ms Hu said she had been "reasonable" but her employees had been "greedy".

"The working holiday makers are very greedy asking for more money, but that's just human nature," she told an inspector in a phone conversation on March 2 last year.

Fair Work Ombudsman Natalie James said the penalties should dispel the myth that overseas workers can be paid a going-rate that is below legal entitlements.

"Overseas workers are entitled to receive the same minimum rates and entitlements that apply to all workers in Australia – and the rates are not negotiable," Ms James said.

Ms James says awareness of minimum entitlements needed to be highlighted in response to her agency's inquiry into the experiences of 417 visa-holders, particularly from Asia, who were not aware of their workplace rights.

The Global Express employees were underpaid between February 2014 and May last year when Hu's company supplied them to three factories in Sydney:

• A Taren Point factory operated by Banquet Desserts Pty Ltd, which supplies cheesecakes and muffins to Coles and Woolworths;
• A factory at Mascot operated by Vienna Schubert Estia Pty Ltd, supplying patisserie products to organisations including hospitality businesses, airlines and schools; and
• A Kirrawee factory operated by South Pack Laboratories Pty Ltd, which operates a business packing vitamins and other complementary medicines.

Judge Smith found that the underpayments were part of a "deliberate strategy aimed at maximising Global's profits". He found Ms Hu lacked remorse and deterrence was needed.

"Those engaged in employing people in Australia must be aware that they face significant penalties for breaching their legal obligations in respect of their employees. Those penalties cannot be seen as no more than an acceptable cost of doing business," he said.

"It is important for employers to recognise that foreign nationals, just as much as Australian residents and citizens, are entitled to full pay for work done by them and that the vulnerability of those workers will be taken into account in the assessment of penalties."

Ms James said she was increasingly concerned about the number of matters where visa-holders were underpaid by culturally and linguistically diverse business owners.

"While I understand there are cultural challenges and different laws in other parts of the world, it is incumbent on all businesses operating in Australia to understand and apply Australian laws. To that end, the Fair Work Ombudsman is here to help with free advice and resources in a range of languages," Ms James said.

Ms James says the Fair Work Ombudsman's report on its inquiry into experiences of 417 visa-holders recommends exploring opportunities to work with a broader range of stakeholders to extend the channels through which information, support and education initiatives are delivered to overseas and migrant workers and employers workers in Australia.

"Outsourcing work to the lowest-cost contractor and turning a blind eye to whether the contractor pays workers' correctly is not acceptable conduct," Ms James said.