Cleaners at Myer stores allegedly underpaid

Note: On 17 August 2014, the Fair Work Ombudsman discontinued its case against Pioneer Personnel Director Aaron Leigh Dickinson. On 19 December 2017, this case was finalised, with Pioneer Personnel being penalised $16,000 in the Federal Circuit Court for eight contraventions of workplace laws which had led to admitted underpayments of $5200 to nine workers.

30 May 2016

Cleaners at a number of Myer stores have allegedly been underpaid thousands of dollars by a major national cleaning contractor.

The Fair Work Ombudsman has commenced legal action against Melbourne-based cleaning services company Pioneer Personnel Pty Ltd and its sole director Aaron Leigh Dickinson, of Moonee Ponds.

Through contracting and sub-contracting arrangements, Pioneer Personnel supplied hundreds of employees to perform cleaning duties for a number of major retailers nationally. 

The Fair Work Ombudsman alleges Pioneer Personnel contravened the Fair Work Act by short-changing nine employees it supplied to clean Myer stores at Chadstone, Doncaster and the CBD in Melbourne; the CBD in Hobart and Maroochydore on Queensland’s Sunshine Coast in 2014.

The allegedly underpaid employees include a number of migrant workers from non-English speaking backgrounds.

If the Fair Work Ombudsman’s allegations relating to the nine employees are accepted by the Court, the Agency will seek penalties against Pioneer Personnel and Mr Dickinson.

The Agency will also seek Court Orders requiring Pioneer Personnel to commission professional external audits of its compliance with workplace laws and to rectify any further underpayments identified across its extensive national workforce.  

A Court Order requiring Pioneer Personnel to provide evidence to the Fair Work Ombudsman of steps it takes to ensure future compliance will also be sought.

The Fair Work Ombudsman alleges Pioneer Personnel underpaid nine employees more than $18,000 between April and November, 2014.

The employees were allegedly variously underpaid minimum engagement period pay, part-time loading, public holiday pay, annual leave entitlements, broken shift allowances, overtime rates, Saturday penalty rates and shift penalty rates they were entitled to under the Cleaning Services Award.   

The Fair Work Ombudsman alleges Pioneer Personnel, through Mr Dickinson, was put on notice as early as March, 2014 of the need to pay employees minimum Award rates.  

Fair Work Ombudsman Natalie James says a decision was made to commence legal action because Pioneer Personnel had previously been put on notice and because of concerns that the company’s alleged non-compliance issues potentially affect a large number of workers, including many vulnerable workers.

The Fair Work Ombudsman alleges that Pioneer Personnel Pty Ltd and Mr Dickinson committed multiple contraventions of workplace laws. Pioneer Personnel faces maximum penalties of up to $51,000 per contravention and Mr Dickinson faces penalties of up to $10,200 per contravention.

The Fair Work Ombudsman is also seeking Court Orders requiring Pioneer Personnel to fully rectify the alleged underpayment of the nine employees, who have been only partially back-paid, and for Pioneer Personnel managers and Mr Dickinson to undergo training on workplace relations laws.

Ms James says the alleged contraventions were discovered as part of investigations into a number of cleaning contractors engaged by Myer. The investigations into other contractors remain ongoing.

“The Fair Work Ombudsman has for some time held concerns about the workplace practices of cleaning contractors engaged by Myer at various sites,” she says.

Last year, the Agency entered Enforceable Undertakings with two cleaning sub-contractors working at Myer sites that were found to be misclassifying workers and underpaying them. See:

The Fair Work Ombudsman has held a number of meetings with Myer and expressed ongoing concerns about the employees of cleaning contractors engaged by Myer.

Myer has been invited to enter into a compliance partnership with the Fair Work Ombudsman to address issues of non-compliance within its supply chain, however the company has so far declined that invitation.

Ms James says her Agency is committed to working with major national employers to help them put processes in place to ensure all workers in their workplaces, including those employed by contractors, are not being exploited.

“Outsourcing is a legitimate business arrangement – but in my experience, in highly competitive markets for low-skilled work, it also increases the risk that workers will be underpaid, sometimes quite deliberately,” Ms James said.

Read A view from the top – building a culture of compliance in Australia’s labour supply chain – an address by Natalie James to ALERA on 27 May, 2016.

The Fair Work Ombudsman recently again called on cleaning contractors to pay greater attention to wage rates after another of the Agency’s national campaigns found cleaning businesses continuing to short-change their workers. See – Cleaning industry compliance needs to improve.

The Agency also recently released its findings into the procurement of house-keeping services by three major chains operating 4 and 5-star hotels. See – Statement on outcome of Inquiry into the housekeeping services of 4 and 5-star hotels.

Ms James says the Fair Work Ombudsman has been working with key industry participants as part of a Cleaning Accountability Framework to promote a culture of compliance with workplace laws.

Ms James encouraged employers with concerns about whether their workplace practices were appropriate to visit www.fairwork.gov.au or call the Fair Work Infoline on 13 13 94 for advice.

An interpreter service is available by calling 13 14 50, and information on the website is translated into 27 languages.

Follow Fair Work Ombudsman Natalie James on Twitter @NatJamesFWO external-icon.png, the Fair Work Ombudsman @fairwork_gov_au External link icon or find us on Facebook www.facebook.com/fairwork.gov.au External link icon.

Sign up to receive the Fair Work Ombudsman’s media releases direct to your email inbox at www.fairwork.gov.au/mediareleases.

Media inquiries:

Ryan Pedler, Assistant Media Director
Mobile: 0411 430 902
ryan.pedler@fwo.gov.au

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