Sep 11, 2023

Tasmanian aged care provider nears completion of $7 million back pay bungle

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Over 1700 former and current staff at a Tasmanian aged care provider have received back payments following major payroll and human resources errors. [Source: Shutterstock]

Two years after it recognised fundamental errors in its payroll and human resources systems, Southern Cross Care (Tasmania) (SCCT) has almost back-paid nearly $7 million to part-time staff and shift workers who missed out on expected entitlements.

Key points

  • A total of 1708 current and former employees were impacted over a seven-year period, with the majority part-time aged care workers, nurses and community care workers
  • Some full-time and casual employees were also impacted, alongside a small number of cleaners, laundry and maintenance staff
  • The average back payment was a tick over $4000, with one staff member owed $220,000 while some received less than $1
  • The total sum of $6.87 million, included $5,806,756 in wages and entitlements, plus $313,591 in superannuation and $754,181 in interest

SCCT, a not-for-profit aged care provider, first reported its breaches to the Fair Work Ombudsman in August 2021, after an internal review raised several red flags. Cited as fundamental errors, SCCT did not have agreements in place with part-time staff to work additional hours at ordinary rates of pay, but they were not paid overtime for additional hours despite being entitled to the higher rates.

In addition, shift workers without written agreements were also entitled to be paid from the beginning of their shift to the end of their final shift each day, not just the exact hours worked during separate shifts. Some employees also missed out on weekend penalty rates, paid meal breaks and allowances. 

It’s been a tumultuous period for SCCT: former Chief Executive Officer Robyn Boyd stepped down in August with the provider arguably unable to overcome a poor history of sanctions and staff discontent.

SCCT Acting Chair, Judith Fishlock, apologised to impacted staff for the errors.

With the majority of past and present workers receiving their back pay, SCCT has signed a written agreement called an Enforceable Undertaking (EU) with the Fair Work Ombudsman to show it is committed to fixing past errors and it will take preventative measures to ensure it does not happen again.

Under the EU, SCCT has until the end of September to back-pay the remaining impacted workers. Clear evidence of systems and processes to ensure future compliance and workplace relations training for human resources, payroll and rostering staff are also required.

Fair Work Ombudsman Anna Booth said SCCT has cooperated fully and demonstrated a strong commitment to rectifying underpayments. 

“Under the Enforceable Undertaking, Southern Cross Care (Tasmania) has committed to implementing stringent measures to ensure all of its workers are paid correctly. These measures include commissioning, at its own cost, three annual independent audits to check its compliance with workplace laws,” Ms Booth said.

“This matter demonstrates how important it is for employers to place a high priority on their workplace obligations. Fundamental errors – including failing to ensure that written agreements with part-time employees were in place – were left unchecked, which led to long-term breaches and a substantial back-payment bill. We expect all employers to invest the time and resources to ensure they are meeting all lawful entitlements.”

SCCT must also write to all employees to notify them of the EU’s commencement, however, The Health and Community Services Union Tasmania (HACSU) has criticised current communications as it told The ABC some staff were still unsure if they had received the correct amount of money. 

“Southern Cross Care have never provided employees with the proper working of how they’ve come to the calculations [for] what they’ve paid them so far. We have taken that to the Fair Work Commission and asked for those calculations. We still, to this date, don’t have that,” HACSU State Secretary Robbie Moore said.

“An apology simply doesn’t adequately address that, in the end, employees have been without money that they should have had. If a worker was to steal $1 from their employer that worker would be sacked, yet an employer can steal over $6 million and pay no penalty,” he added.

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  1. I believe Regis Aged Care owe millions to past and present staff as well. It seems like a disease for large corporations with a majority of foureign employees to be ripped off. I believe the staff are still waiting to hear what is happening. Like 3 or more yrs since the investigation began.

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