A failed Gold Coast childcare operator owes 37 workers $250,000 in redundancy entitlements.
The Federal Circuit and Family Court penalised the company behind the centre $45,000 for the wage theft.
It also ordered it to back-pay the workers in full.
Gold Coast childcare operator owes workers entitlements
Kids Academy Hope Island Pty Ltd used to run the Kids Academy Hope Island childcare centre on the Gold Coast.
The Fair Work Ombudsman commenced an investigation as a result of receiving wage theft complaints when the centre closed in 2020.
Kids Academy owed 37 workers a total of $250,290 in redundancy payments.
A Fair Work inspector subsequently issued three separate Compliance Notices to Kids Academy in February and March 2021.
The Notices required the company to calculate and back-pay the workers, however, it failed to do so.
Court orders to Gold Coast childcare operator
In addition to the $45,000 penalty, the court also ordered Kids Academy to back-pay 37 of the workers a total of $250,290.35 in redundancy entitlements.
It also ordered the company to calculate and rectify underpayments to an additional worker owed pay-in-lieu-of-notice-of-termination.
Unpaid redundancies common
Industrial advocate Miles Heffernan said bosses often refuse to pay redundancy payments when a business closes.
“We recently represented two medical centre receptionists made redundant when the business was sold,” he said.
“We commenced legal action in the Federal Court on their behalf before the new owner finally back-paid the outstanding $80,000 he owed them.”
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Rockhampton company refuses redundancy payments
Meanwhile, in 2018, the Federal Circuit Court penalised a Rockhampton-based company, Alertvale Pty Ltd, $31,590.
The company, which provides services to the mining industry, refused to pay two Filipino welders $9,931 in termination and redundancy entitlements.
Judge Robert Harper described the wage theft as “both reckless and negligent”.
Ignoring penalties costs employers
Fair Work Ombudsman Sandra Parker said employers who fail to act on Compliance Notices will face court-imposed penalties on top of having to back-pay workers.
“When Compliance Notices are not followed, we are prepared to take legal action to ensure workers receive their lawful entitlements.”
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