The Fair Work Ombudsman has commenced legal action against childcare operator G8 Education Limited, alleging underpayments and seeking compensation of more than $2 million combined for more than 1,400 workers.
The FWO is seeking declarations, penalties, and orders for any outstanding amounts to be paid to the impacted workers.
G8 Education is one of Australia's biggest for-profit operators of childcare and early learning centres.
The publicly listed company self-reported non-compliance issues and the FWO subsequently commenced an investigation.
In legal action filed in the Federal Court, the Fair Work Ombudsman alleges G8 Education:
- underpaid employees' minimum rate and overtime entitlements,
- underpaid some employees engaged as trainees, and
- failed to pay a first aid allowance to some employees.
All affected employees worked in childcare centres as children's services employees or support workers. Affected workers included, but extend beyond, some juniors aged under 20.
It is alleged there were underpayments of $1.03 million for workers under the Children's Services Award 2010.
It is also alleged G8 Education failed to ensure that hundreds of childcare workers it entered into Individual Flexibility Arrangements (IFAs) with were better off overall than if the IFAs had not been made.
The Fair Work Ombudsman alleges workers were not left better off overall by the IFAs, which increased the number of ordinary hours that could be worked in a day without the payment of overtime from the usual 8 hours to 10 hours. The FWO alleges there was no monetary benefit to the workers under the IFAs, and any non-monetary benefit some of the IFAs purportedly gave these workers was not sufficient to leave them better off overall.
It is alleged that some of the IFAs resulted in workers not being paid entitlements that they would have otherwise received and the FWO is seeking compensation for these workers representing $1.045 million of the total sum being sought.
Fair Work Ombudsman Anna Booth said the alleged conduct was disappointing.
"It is completely unacceptable for large, well-resourced corporate employers to allegedly underpay hard-working childcare workers' basic minimum entitlements," Ms Booth said.
"We have been saying for years that large corporate employers need to place a higher priority on ensuring they pay their employees' lawful entitlements.
"It is crucial for employers that any Individual Flexibility Arrangements leave employees better off overall.
"Any workers with concerns about their pay or entitlements should contact us for free advice and assistance. They can also contact their union if they are a member."
The Fair Work Ombudsman is seeking penalties against G8 Education in court for multiple alleged contraventions of the Children's Services Award 2010.
This includes alleged underpayment of a number of overtime entitlements, as well as minimum wage rates, loadings and first aid allowance.
It is alleged G8 Education also contravened laws covering requirements for IFAs, including being signed by both parties and identifying the correct Award term being varied.
The contraventions allegedly occurred between June 2020 and July 2022.
G8 Education faces penalties of up to $66,600 per contravention.
The Fair Work Ombudsman is also seeking court orders requiring G8 Education to make payments for any amounts owing to the employees, plus superannuation and interest. For those allegedly underpaid under the Children's Services Award, individual payments being sought range from approximately $50 to more than $15,000.
Compensation amounts sought for the allegedly impacted workers under IFAs range from approximately $100 to more than $6,000.
A first court date is yet to be listed.
