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The aged care provider enters an enforceable undertaking after underpaying thousands of workers over more than a decade.
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RSL LifeCare pays out $5m to short-changed staff
16 December 2022
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Aged and veteran services organisation RSL LifeCare Limited has back-paid staff in NSW and the ACT more than $5 million and entered into an enforceable undertaking with the Fair Work Ombudsman.
The not-for-profit organisation, which is affiliated with RSL NSW, self-reported its non-compliance to the FWO in 2021 after becoming aware of underpayments when it conducted a self-initiated review during its transition to a new human resources and payroll system.
Underpaid employees were engaged in nursing and management roles at aged care facilities and in home care programs. They included full-time, part-time and casual employees and were based in Sydney, Canberra and regional NSW.
The underpayments were caused by RSL LifeCare making fundamental payroll and rostering system errors, including incorrect system set up and incorrect pay rules being entered.
Between 2010 and 2021, RSL LifeCare’s employees were underpaid entitlements set out in the RSL LifeCare NSWNMA and HSU NSW Enterprise Agreement 2017-2020 and the RSL LifeCare (ACT) Enterprise Agreement 2019-2020 (and the predecessor Enterprise Agreements).
The majority of the underpayments involved RSL LifeCare failing to pay overtime rates in a range of situations where they should have been paid, such as when employees had insufficient breaks between shifts and when part-time employees performed work on rostered days off but had otherwise worked less than 76 hours in a fortnight.
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Another significant cause of the underpayments was RSL LifeCare’s failure to provide shift workers with their entitlement to an extra week of annual leave while some employees were underpaid weekend penalty rates.
RSL LifeCare has back-paid over $5.1 million to more than 3,591 current and former employees, including superannuation and interest. Individual back-payments range from less than $1 to more than $76,000.
Fair Work Ombudsman Sandra Parker said that an enforceable undertaking was appropriate because RSL LifeCare had cooperated and demonstrated a strong commitment to rectifying underpayments, including devoting significant resources to engaging independent experts to oversee its rectification.
“Under the enforceable undertaking, RSL LifeCare has committed to implementing stringent measures to ensure workers are paid correctly. These measures include engaging, at the company’s own cost, audits of its compliance with workplace laws over the next two years,” Ms Parker said.
“This matter demonstrates how important it is for employers to place a high priority on their workplace obligations and ensure that their systems and processes support full compliance. In this matter, fundamental shortcomings in RSL LifeCare’s payroll and rostering system led to long-term breaches of its own enterprise agreements and a substantial backpayment bill.”
More than $4.7 million in back payments are being made to NSW workers, with more than $525,000 in back payments being made to ACT workers.
A small number of yet-be-allocated entitlements remain, with all due to be rectified by April 2023 under the agreement.
RSL LifeCare is also required to provide FWO with evidence of systems and processes it has put in place to ensure future compliance, commission an independent organisation to operate a hotline for employees to enquire about their wages and entitlements, and commission workplace relations training for human resources, payroll and rostering staff.
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