Aged care investigations recover $5.3 million for underpaid workers
The Fair Work Ombudsman has recovered more than $5.3 million for nearly 3,600 underpaid direct care employees working for aged care businesses after investigations.
The FWO found that of the 22 aged care businesses providing residential aged care and home care it investigated, 13 were non-compliant with workplace laws in one or more areas. Eight were compliant and one business remains under investigation.
All 13 non-compliant aged care providers had underpaid employees, with six residential aged care providers back-paying 2,338 employees more than $2.17 million and seven home care providers back-paying 1,253 employees more than $3.13 million.
The Fair Work Ombudsman investigated a number of aged care providers that are headquartered in Victoria, New South Wales, South Australia, Queensland and Western Australia. Many of the investigated employers operate in multiple states. Investigations covered both metropolitan and regional areas.
Direct care workers include personal care workers, enrolled and registered nurses, and assistants in nursing.
The back-payments to workers came after the FWO issued a total of 16 Compliance Notices to the 13 employers. Two residential care providers also paid a combined $4,620 in fines for record-keeping and payslip breaches.
Employers were selected for inspection based on factors including any history of non-compliance with the Fair Work Act, anonymous reports from staff members received by the FWO, and/or their employment of visa holders, among other intelligence. Migrant workers are a significant component of the aged care workforce.
The most common contraventions involved underpayment of minimum rates of pay; underpayment or non-payment of broken shift entitlements; non-payment for minimum engagement periods; and underpayment of overtime.
The average overall underpayment per employee was $1,478.
Other contraventions involved breaching record-keeping and payslip requirements, and not providing a Fair Work Information Statement to all employees. One provider also advertised below-minimum rates of pay.
Fair Work Ombudsman Anna Booth said the investigation results sent a message that aged care providers needed to strengthen their compliance to ensure they pay their employees all they are owed.
“Aged care providers need to make sure their payroll systems are fit-for-purpose and payroll staff are properly trained to make sure employees are paid for every dollar they’re entitled to,” Ms Booth said.
“The FWO calls upon aged care providers to invest in strengthening their payroll and rostering systems and to undertake their own, regular wage compliance audits – or potentially face big back-pay bills.”
“The leading causes of breaches were the incorrect classification of employees, calculation of overtime, application of broken shifts and payment of minimum engagement periods. Small errors in isolation can be costly across a large workforce. Improved payroll and rostering practices and a greater compliance focus can avoid these issues.”
Ms Booth acknowledged the investigated employers had been cooperative and proactive.
“The FWO commends the investigated employers who conducted their own audits and back-paid employees beyond the scope of our investigation. These actions indicated most employers were committed to putting in place assurance measures that would strengthen their compliance practices.
“We’d like to see this proactive audit approach replicated across the aged care sector,” Ms Booth said.
When the FWO found that one home care employer’s casual employees had been underpaid due to the company’s failure to correctly apply broken shift allowances and minimum engagement periods, the employer took swift action.
The employer sought external advice on the award entitlements, conducted a full workforce audit and back-paid over $2 million to more than 600 employees back to 2023 when the errors began.
The provider also updated its payroll system and provided training to relevant staff to prevent future non-compliance.
The FWO has now begun inspections and investigations of 30 employers’ compliance in relation to cleaning and catering employees in aged care. Our proactive investigation of these employers will look at payslips, record-keeping and pay rates. Investigations are continuing.
These investigations have occurred alongside the FWO’s collaboration with members of our Aged Care Services Reference Group, a tripartite initiative combining employer bodies and unions, to promote and enhance compliance with workplace laws across the sector.
Employers and employees can visit www.fairwork.gov.au or call the Fair Work Infoline on 13 13 94 for free advice and assistance about their rights and obligations in the workplace. A free interpreter service is available on 13 14 50.
Specific information is also available to help understand the Aged Care Award.
Issues can also be reported online anonymously to the FWO, including in languages other than English. Employees can also seek information from their union, if they are a member, or from their employer.
The FWO also has resources for migrants and visa holder workers – who have the same workplace rights as all other employees, with protections for their visa if they call out for help.
