A Melbourne-based recruitment and labour hire company deducted unlawful "administration fees" from its on-hire workers' wages, and later falsified employment records, the Fair Work Ombudsman has alleged in a new prosecution.

The FWO filed proceedings against Oz Staff Career Services Pty Ltd in the Federal Circuit Court, claiming the company deducted a total of $130,183 from the wages of 102 cleaners between December 2011 and May 2013.

An FWO audit revealed Oz Staff was charging on-hire workers "administration fees" of around $25 per week and "meal fees", with total underpayments ranging from $5 to $2,246 for individual employees, according to its statement of claim.

The FWO argued these payments were unlawful because they were not principally for the benefit of the employees, and that the employees had not authorised them, as required by workplace law.

Also facing court is Oz Staff's CEO and sole director, Travice Blom, who was also the director of labour hire company Oz Staff Pty Ltd, which went into liquidation in 2012.

During a meeting with FWO inspectors in February 2013, Blom allegedly "made statements... to the effect that the 'old company Oz Staff' had received advice that the deduction of the administration fee was 'ok' and the practice 'was never something they tried to hide as it was displayed on payslips'".

He allegedly told the inspectors during the meeting that the practice would cease, however continued to make deductions until May, claimed the FWO.

Employment records allegedly falsified

Oz Staff, which is an RCSA member, committed a further breach of workplace law by providing inspectors with false and misleading records that did not contain details of the deductions, argued the FWO.

The initial scope of the FWO audit focused on the time and wage records of employees on-hired to either the Crown Casino or Federation Square, in Melbourne, for a two-week period in December 2011, it said.

The FWO claimed some of the initial payment records Oz Staff provided had no administration fees deducted, and were inconsistent with records later provided by Oz Staff's lawyers, which included these deductions.

"The first payment records contained knowingly false and misleading entries in relation to deductions and the net pay amount paid to the [employees]," said the statement of claim.

The case is listed for a directions hearing on March 6, and if found guilty, Oz Staff faces maximum penalties of between $33,000 and $51,000 per breach, while the maximum individual penalties for Blom range from $6,600 to $10,200 per breach.

Fair Work Ombudsman Natalie James said the seriousness of the alleged breaches, and the fact they involved vulnerable workers, were significant factors in the FWO's decision to commence legal action.

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