Company allegedly sent workers to clients for manual labour but paid them nothing
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A labour-hire business is facing charges in Federal Court for allegedly underpaying 10 employees by more than $14,000, through an unlawful unpaid work experience program.
The Fair Work Ombudsman has started legal action against Brisbane-based Workforce Solutions and its manager Matthew Micallef. who allegedly supplied 10 workers to perform between three and 26 days of work for three of its clients in manufacturing and warehousing.
However, the workers were paid nothing on the basis that it was 'work experience'. Two of the workers were just 19 years old at the time.
Despite not paying the workers, it is alleged that Workforce Solutions charged its clients $15 for each hour of low-skilled, manual work.
The correct lawful classification of the workers was as employees – meaning they were entitled to minimum hourly wage rates and entitlements under the relevant Modern Awards, alleges the FWO.
The agency investigated the matter after the workers sought its assistance. They should have been paid $14,376, and the largest underpayment is allegedly $4,525.
The FWO is claiming Workforce Solutions invited the workers to paid jobs through website advertisements, and then told them they were unsuccessful because of lack of experience or a job reference.
The company then allegedly offered the workers the opportunity to gain the lacking experience and reference through unpaid work.
Workforce Solutions has now rectified the alleged underpayments.
Fair Work Ombudsman Natalie James said they initiated legal action because they wanted to deter employers from trying to profit by using unlawful unpaid work schemes as a source of free labour.
It was disappointing, James said, that the incident with one of the 10 workers took place after the agency had already issued Workforce a contravention letter for its “work experience program” for the nine other employees.
Workforce Solutions faces penalties of up to $54,000 per contravention, while Micallef faces penalties of up to $10,800 per contravention.
The FWO is also seeking a Court Order for the company to complete a retrospective audit of entitlements owed to any worker involved in their work experience program since the start of 2015. It must rectify any underpayments identified.
James said legitimate internship and work placements can be a genuine way for people to further their learning or gain skills that assist in finding employment.
“Unpaid placements or ‘internships’ are legitimate in certain cases – for example, where they are part of an approved program, such as vocational placement related to a course of study,” said James.
“But the law prohibits the exploitation of workers by characterising them as ‘interns’ or as doing ‘work experience’ when they are fulfilling the role of an employee. Such workers must be paid minimum employee entitlements.”