SINGAPORE — Jaime Teo, co-founder of Twelve Cupcakes, admitted on Thursday (4 February) to neglecting to ensure that the confectionary chain paid seven foreign employees their full salaries for more than three years.
Teo, 43, pleaded guilty to 10 out of 24 charges under the Employment of Foreign Manpower Act for contravening foreign employees’ work pass conditions, with the rest to be taken into consideration for sentencing.
The charges took place between 2013 and 2016. Teo neglected to ensure that the seven employees received full salaries ranging from $2,000 to $2,600.
Teo, a former actress, founded the Twelve Cupcakes chain in 2011 with ex-husband and radio DJ Daniel Ong Ming Yu while they were still married. They were divorced in 2016.
At the time, she was the director and main decision maker and controlled the company’s expenses, said a Ministry of Manpower prosecutor on Thursday. Teo and Ong were responsible for employee salaries as they were signatories to the company’s account.
In 2012, both Ong and Teo decided to employ foreign manpower to expand the company’s business and agreed on the salary ranges of these employees. These seven foreigners were issued S-passes.
The company underpaid the employees for a total of three years and two months, from 2013 to 2016, with Teo failing to take steps to ensure they received their proper salaries. Teo ceased to be a director on 15 December 2016 when the business was sold to an investor company.
The underpayment amounted to $98,900.
Representing Teo, lawyer Sunil Sudheesan said that Twelve Cupcakes was a family-owned business, with Teo handling product development and marketing since its inception.
“Specifically, her role was not to deal with human resources or admin or not to deal with operations and not to deal with business development. That was in the realm of three other directors,” said Sunil.
Twelve Cupcakes’ human resources director later employed a third-party employment agency and Teo had just agreed to decisions, leaving employment issues to others.
“Specifically, she was not involved in discussion with regard to employment details. She did agree with the decision on what salary ranges should be and she did not have any sort of substantial contact with the third-party agency,” he added.
Teo’s neglect contributed to the offending behaviour but she was unaware of the details and therefore her ability to intervene was compromised, said the lawyer.
Throughout the course of Teo’s conduct, she would be given folder filled with pages which she was supposed to affix her signature and she was told these were for administrative purposes, said the lawyer.
The lawyer sought a $20,000 fine for Teo.
In contrast, the prosecution sought an $80,000 fine for Teo, citing several aggravating factors. MOM prosecutor Maximilian Chew said that the offence resulted in substantial financial gain of $98,900 for the company.
He added that the neglect was a continuous lapse rather than one-off incident and that Teo had not made restitution to the employees.
The case was adjourned for defence lawyers Sunil and Diana Ngiam to make written submissions. Teo will return to court on 25 February.
Ong’s case is still pending and scheduled for a further mention on 16 February.
Earlier this year, Twelve Cupcakes was fined $119,500 in relation to similar offences.
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