Aged care provider underpaid staff more than $3.5m

The underpayment of almost 5,000 employees comes as the government provides a 15 per cent increase in the industry’s award wages.

The FWO has entered into an enforceable undertaking with aged care provider Uniting AgeWell Limited after it was found to have underpaid staff more than $3.5 million.

Uniting AgeWell Limited, a not-for-profit organisation run by the Uniting Church of Australia, self-reported its non-compliance to the FWO in September 2021 when it discovered the underpayments while conducting a review.

The FWO investigators found 4,971 Uniting AgeWell employees were underpaid a total of more than $3.5 million plus $127,640 in superannuation across both Victoria and Tasmania.

The organisation said the underpayments were due to it incorrectly interpreting its enterprise agreements which saw a failure to pay the correct penalty rates and allowances owed, including overtime rates.

The regulator said most of the individual back payments ranged from less than $1 to up to $10,000, with 36 back payments ranging from $10,000 to the highest of $104,345.

The company was said to be eligible for an enforceable undertaking as it had already remediated all underpayments to all employees it could fine, with more than $3.5 million including interest and superannuation having been paid to 4,224 current and former employees.

The FWO said the remaining underpayments to workers would be rectified in the coming months.

Fair Work Ombudsman Sandra Parker said the cooperation by Uniting AgeWell as well as the demonstration of commitment to amend the underpayments meant an enforceable undertaking agreement was appropriate.

“Under the enforceable undertaking, Uniting AgeWell has committed to implementing stringent measures to improve compliance and protect the rights of its workforce,” said Ms Parker.

“These measures include commissioning, at its own cost, an independent audit to check its compliance with workplace laws later this year.”

“This matter demonstrates how important it is for employers to identify and fix non-compliance in their processes. Errors particularly in Uniting AgeWell’s rostering and understanding of certain entitlements were left unchecked, which left hardworking employees missing out on their money.”

The action against Uniting AgeWell comes after late last year the FWO took action against another aged services organisation - RSL LifeCare Limited - which had underpaid 3,591 employees more than $5.1 million.

This article was originally published on HR Leader's sister brand Accountants Daily.