Disability support charity Open Minds Australia Limited has back-paid staff about $4.2 million after breaching its own collective agreement and has signed an Enforceable Undertaking (EU) with the Fair Work Ombudsman.
The in-home care and support services charity assists people with cognitive and physical disabilities across 35 sites in Queensland and northern NSW. In 2021, Open Minds became a subsidiary of Multicap Limited.
Open Minds self-reported underpayments to the FWO in June 2021 having become aware of compliance issues after an internal payroll review found it had breached certain provisions of its collective agreement.
Open Minds was uncertain about the interpretation of its collective agreement and made errors in its payroll and rostering system, resulting in underpaid entitlements to do with sleepovers, penalty rates, overtime, allowances and pay point increments.
This resulted in 1,507 current and former employees being underpaid $3.33 million, including more than $190,000 in superannuation, between July 2015 and July 2021. Open Minds has also back-paid more than $170,000 in interest.
In addition, Open Minds has back-paid about $695,000, including superannuation, to current and former employees after a review to ensure the salaries paid under common law contracts between 2015 and 2022 were above the comparable collective agreement entitlements.
Employees affected by the breaches were full-time, part-time and casual support workers, residential support workers and case workers. Underpaid workers were based in locations such as Brisbane, Moreton Bay, Logan, Redlands and Lismore.
Open Minds has completed all its back-payments, having made remediation directly to all current employees and all former employees it could locate, and paying the small remaining amount owed to 31 former employees to the Fair Work Ombudsman as unclaimed monies in March 2024.
Individual back-payments to employees ranged from small amounts to almost $50,000, and the average back-payment was about $2,400 including superannuation and interest.
Fair Work Ombudsman Anna Booth said an EU was appropriate as Open Minds had cooperated with the FWO's investigation and demonstrated a strong commitment to both rectifying underpayments and making changes to ensure they are not repeated.
"Under the Enforceable Undertaking, Open Minds has committed to implementing stringent measures to ensure all its workers are paid correctly. These measures include commissioning, at its own cost, an independent auditor to check it is appropriately meeting all employee entitlements," Ms Booth said.
Ms Booth said the matter was a wake up call to all employers to ensure they understand, and have systems that can correctly apply, the terms of their own enterprise agreements.
"In this matter, a failure to correctly apply the terms of their own enterprise agreement led to long-term breaches and hardworking disability sector workers missing out on their money," Ms Booth said.
"Employers need to place a much higher priority on having systems and processes in place that ensure employees' full lawful entitlements are met, year-in, year-out."
The EU also requires Open Minds to provide a report to the FWO on its progress in implementing a new integrated rostering and payroll system; convene a payroll remediation committee; run an independent employee hotline to take any workplace relations queries for three months; and write to underpaid staff to notify them the EU has begun.
The workers' entitlements were owed under the Fair Work Act and the Open Minds Collective Agreement 2015-2017.
