12 October 2023

Disability support services provider Aruma Services Limited has back-paid Victorian staff more than $6.5 million, including interest and superannuation, and signed an Enforceable Undertaking (EU) with the Fair Work Ombudsman.

The not-for-profit organisation provides home and living support, supported employment, social and community participation and therapeutic services to adults and children with disability across NSW, Queensland, Victoria and the ACT.

Aruma self-reported its breaches to the regulator in June 2021 after identifying underpayments in a self-initiated review. Its enterprise agreement had been interpreted incorrectly and there were deficiencies in Aruma’s payroll system, including that it could not always correctly apply overtime rates.

As a result, Aruma breached clauses of its enterprise agreement and 1,004 employees were underpaid between July 2017 and April 2021.

The majority of the underpayments involved Aruma failing to provide part-time employees with their minimum agreed hours (or pay for them), and failing to apply overtime rates where an employee worked more than six consecutive days of ordinary duty without a 24-hour break.

The underpaid employees performed work in locations across regional and metropolitan Victoria. Engaged full-time and part-time, they performed personal and community care roles in residential and respite accommodation services, and day and community-based services.

Aruma has back-paid the current and former employees more than $6.5 million, including $697,000 in superannuation and $488,000 in interest.

The majority of individual back-payments were between $1,000 to $2,000. Underpayments ranged from $5 to more than $231,000.

While Aruma has already back-paid the large majority of employees, including all those it could find, under the EU it must back-pay all staff by January 2024. The remaining back-payments to occur total about $585,000 to 77 workers.

Deputy Fair Work Ombudsman – Compliance & Enforcement Mark Scully said an EU was appropriate as the employer had cooperated with the FWO’s investigation and demonstrated a strong commitment to rectifying underpayments.

“Under the Enforceable Undertaking, Aruma has committed to implementing stringent measures to ensure all its workers are paid correctly. These measures include commissioning, at its own cost, an independent audit to check its ongoing compliance with workplace laws,” Mr Scully said.

“This matter demonstrates how important it is for employers to place a high priority on their workplace obligations. Fundamental errors were left unchecked by Aruma, which led to long-term breaches of its own enterprise agreement and a substantial back-payment bill.”

“We expect all employers to invest the time and resources to ensure they are meeting all their workers’ lawful entitlements.”

The EU also requires Aruma to write to all the underpaid employees to notify them of the EU, and run an employee hotline to take questions about employment issues.

Employers and employees can visit www.fairwork.gov.au or call the Fair Work Infoline on 13 13 94 for free advice and assistance. An interpreter service is available on 13 14 50.