By Martin Cole-
Australian Unity Limited has back-paid aged care and disability staff in Victoria and NSW more than $6.8 million it owed and entered into an Enforceable Undertaking with the Fair Work Ombudsman.
The company, listed on the Australian Securities Exchange (ASX), self-reported its non-compliance to the regulator in November 2020 after becoming aware of payroll errors in its Independent and Assisted Living businesses.
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This arm of the company operates retirement communities and provides aged care, allied health and disability services.
It is one of the largest debts to employees known in Australia, and was exposed following a wide investigation by the Fair Work Ombudsman.
It emerged that between 2014 and 2021, employees were underpaid entitlements owed under 10 current and former enterprise agreements, two state awards and the Social, Community, Home Care and Disability Services Industry Award 2010.
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The Fair Work Ombudsman’s investigation found breaches related to penalty rates, minimum engagements, overtime, travel time, higher duties, leave accruals and superannuation.
The underpaid employees included full-time, part-time and casual workers, worked as nurses, cooks, catering employees, residential care workers, lifestyle workers, administrative workers, gardeners, laundry workers and maintenance workers, among other roles.
They were engaged at various locations in NSW including Sydney, Newcastle, the Central Coast and the Northern Rivers; and around Victoria including in Melbourne, Geelong, Ballarat and Mornington.
The payroll errors were identified during a proactive payroll compliance review by Australian Unity.
Its review found various causes, including system and set-up errors; rostering and manual processing errors; incorrect interpretation of obligations; and inadequate training and payroll processes.
Fair Work Ombudsman, Sandra Parker said an Enforceable Undertaking (EU) was appropriate because Australian Unity had demonstrated a strong commitment to rectification.
“Under the Enforceable Undertaking, Australian Unity has committed to implementing stringent measures to ensure workers are paid correctly. These measures include engaging, at the company’s own cost, an independent auditor to complete two annual audits,” Ms Parker said.
“This matter demonstrates why employers should prioritise workplace compliance and ensure their systems and processes meet all requirements of relevant Awards or agreements. Where breaches are not picked up quickly, they can lead to a substantial back-payment bill.”
“Any employer who needs help meeting their lawful obligations to their employees should contact the Fair Work Ombudsman for free advice and assistance.”
Australian Unity has back-paid a total of $6,851,391 in wages and entitlements (including interest and superannuation), to more than 8,500 workers.
It has taken steps to rectify the remaining $516,428 in underpayments, interest and superannuation for remaining employees, and the EU requires the employer to pay all amounts owing within 120 days of the EU’s execution.
Individual underpayments range from less than $1 to more than $23,000, with an average underpayment of $739.
Under the EU, Australian Unity will make a contrition payment of $250,000 to the Commonwealth’s Consolidated Revenue Fund. The EU also requires the company to publish notices at all worksites, apologise to the underpaid employees, and run an employee hotline.
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