IT company director to face court following $150k in alleged underpayments

A company director is facing the prospect of penalties from the Fair Work Ombudsman after allegedly underpaying workers almost $150,000.

Editor’s note: This story first appeared on HR Leader’s sister brand, Accountants Daily.

David Blumentals, the former director of IT company D365 Group, is facing penalties after he allegedly underpaid 16 workers by a total sum of $149,240.

The Fair Work Ombudsman (FWO) launched an investigation into his company after several workers lodged requests for assistance.

“Whether against directors, owners or any other individual accessory, we will continue to take court actions to help employees and to seek penalties to deter breaches,” FWO Anna Booth said.

“Any employees with concerns about their pay or entitlements should contact us for free advice and assistance.”

Intentional wage underpayment has been criminalised as of 1 January 2025, drawing the risk of substantial penalties for employers who intentionally shortchange their workers.

As insolvency rates remain high across the economy, Booth reminded business operators that they could face penalties in court even after their company had been wound up. D365 Group went into liquidation in 2023.

The FWO alleged that the IT company had failed to pay the affected employees their accrued annual leave entitlements when they left the firm, and didn’t pay 12 workers wages for their final weeks of employment.

Individual underpayments ranged from $4,581 to $23,749, the FWO alleged. Seven of the 16 workers had been visa holders, it added.

The ombudsman said that Blumentals, the sole director, shareholder, and company secretary of d365 Group, had the primary responsibility for its operations, including arranging the payment of employees.

Due to this, the FWO has alleged that he was an accessory to the company’s contraventions of workplace laws. He is set to face penalties of up to $13,320 for each alleged breach.

The FWO also said it would order him to personally repay the alleged $149,240 payment shortfall in full, plus interest.

Blumentals’ hearing will take place in Sydney on 15 September 2025.

Booth reiterated that the FWO would continue to take enforcement action against employers that engaged in significant underpayments.

The FWO filed 43 litigatious proceedings, including alleged accessories, in 2023–24, securing $1,936,907 against individuals that year.

It also continues its focus on protecting vulnerable workers, including visa holders, having filed 147 litigations involving visa holder workers and drawn almost $23 million in penalties throughout the seven financial years to June 2024.

Booth said: “There is a strong public interest in demonstrating our commitment to taking enforcement action to ensure individuals are held to account for alleged involvement in significant employee underpayments.”