The Fair Work Ombudsman has recovered $303,299 for 1,010 underpaid workers after investigating companies engaged to provide security at COVID-19 quarantine hotels in Melbourne and Sydney.
Last year, Fair Work Inspectors audited 37 security businesses to check their compliance with workplace laws, including 23 companies providing security in Melbourne and 16 in Sydney. Inspectors found that 15 businesses (41 per cent) were non-compliant.
Inspectors examined a total of nine principal contractors engaged by the Victorian or NSW governments (one was engaged by both) and then investigated any subcontracted arrangements, with 28 subcontractor businesses found.
Of the 15 businesses in breach of workplace laws, 11 had underpaid their workers (including two principal contractors), five had failed to meet pay slip and record-keeping requirements, and one failed to comply with a Notice to Produce records and was issued a formal caution.
Fair Work Ombudsman Sandra Parker said the audit results showed the security industry needed to sharpen its focus on its employment responsibilities.
“We expect all businesses at all levels of a supply chain to meet their obligations under workplace laws so that workers are paid the wages and entitlements they are lawfully owed,” Ms Parker said.
“Employers can use our range of free tools and resources, including on supply chains, if they need any assistance complying with the law. Any workers with concerns about their wages should contact us.”
Eleven of the 23 security companies operating in Melbourne were non-compliant, and four of the 16 in Sydney. The most common breaches found by inspectors were failures to pay penalty rates (eight businesses), followed by failures to pay correct annual or personal leave entitlements (four businesses).
In total, $288,938 was recovered for 665 employees in Melbourne and $14,361 for 345 employees in Sydney. All affected employees were engaged as security guards or supervisors.
Amounts back-paid from individual businesses ranged from $207,681 for 333 employees to $312 for one employee. These two businesses were each subcontractors.
In response to the breaches, the FWO issued 10 Compliance Notices, which recovered $302,281. There was also $1,018 recovered from one business following a contravention letter. There were five Infringement Notices issued for breaches of pay slip laws, resulting in $11,166 in fines paid.
Unified Security Group Australia Pty Ltd was a principal contractor in both the NSW and Victorian hotel quarantine programs and admitted they owed unpaid entitlements to staff in Sydney (estimated to be approximately $900,000). The FWO issued a Compliance Notice requiring Unified to backpay those employees but the company went into liquidation in May this year.
All non-compliant businesses were advised that any future breaches may lead to higher-level enforcement action by the Fair Work Ombudsman.