A Brisbane labour hire business will face court for allegedly underpaying 10 employees more than $14,000 through an unlawful unpaid work experience program.
The Fair Work Ombudsman has commenced litigation in the Federal Court against Workforce Solutions (QLD) Pty Ltd and its general manager Mathew Micallef.
It is alleged that Workforce Solutions supplied 10 workers, including two aged 19 at the time, to perform between three and 26 days’ work for three of its clients’ businesses but paid the workers nothing on the basis that it was “work experience”.
It is alleged further that Workforce Solutions initially invited the workers to apply for paid jobs via website advertisements, then told them they had been unsuccessful due to an absence of industry experience or a job reference. The business then offered the workers the opportunity to gain experience and a reference through unpaid work.
Despite paying the workers nothing, Workforce Solutions allegedly charged its clients $15 for each hour worked by each of the workers. The workers variously performed low-skilled manual work at three businesses in the warehousing and manufacturing sectors in Brisbane.
The Fair Work Ombudsman stated that 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. The 10 workers were allegedly entitled to have been paid a total of $14,376, with the largest alleged individual underpayment being $4,525.
Nine of the workers were underpaid for work performed in 2015, while one was allegedly underpaid for work performed last year. Workforce Solutions has now rectified the alleged underpayments.
Fair Work Ombudsman Natalie James says a key factor in the decision to commence legal action was the need to deter employers from trying to profit by using unlawful unpaid work schemes as a source of free labour.
James was disappointed that the alleged exploitation of one of the 10 workers occurred after the Fair Work Ombudsman had issued Workforce Solutions a contravention letter making it clear that its unpaid work experience program for the nine other employees was unlawful.
Workforce Solutions faces penalties of up to $54,000 per contravention, while Mr Micallef faces penalties of up to $10,800 per contravention.
The Fair Work Ombudsman is also seeking a Court Order for Workforce Solutions to complete a retrospective audit of entitlements owed to any worker involved in their work experience program since the start of 2015 and to rectify any underpayments identified.
James said that 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.
“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,” Ms James added. “Such workers must be paid minimum employee entitlements.”