[Australia] Suncorp back-pays $32 million and signs Enforceable Undertaking

In Australia, banking, insurance and wealth management services provider Suncorp has back-paid staff about $32 million, including interest and superannuation and entered into an Enforceable Undertaking (EU) with the Fair Work Ombudsman, Fair Work Ombudsman reports.

Suncorp self-reported breaches to the FWO in 2020. Suncorp Staff Pty Ltd, Suncorp Insurance Services Limited and Australian Associated Motor Insurers Pty Limited (AAMI) (together, Suncorp) provide services in Australia and New Zealand.

Suncorp reportedly underpaid more than 15,800 employees’ minimum wages between May 2014 and March 2022 through its inconsistent application of the term ‘Rostered Employee’ and the Rostered Employee clause (where these employees were entitled to shift penalties) in its Enterprise Agreements.

The underpayments and EU both relate to the companies’ insurance arm.

Suncorp’s inconsistent use of ‘Rostered employee’ and misunderstandings of appropriate entitlements under a self-service process led to the underpayment of entitlements including overtime, shift loadings, weekend penalties, annual leave loading, public holiday loadings, minimum rate of pay, long service leave, redundancy, payment in lieu of notice, meal allowances and superannuation.

Suncorp identified underpayments after starting an internal review of specific pay and leave practices and its rostering systems.

The underpaid employees - both current and former - worked across the nation in a variety of roles in the insurance arm of the three companies, including as advisors, assessors, customer support staff, technical staff, team leaders and managers.

Suncorp has back-paid more than 99 per cent of the more than $32 million owed already, including having paid about $26 million in wages and entitlements, $4.5 million in interest and $1.4 million in superannuation.

Individual payments reportedly range from $1 to $54,951, with an average underpayment of $1,687 for each impacted employee. The remaining underpayments must be rectified by September 2023.

Fair Work Ombudsman Sandra Parker stated that an EU was appropriate because Suncorp had cooperated and demonstrated a firm commitment to rectifying underpayments.

“Under the Enforceable Undertaking, Suncorp has committed to stringent measures to ensure its employee are paid correctly in the future. These measures include engaging, at the company’s own cost, two independent annual audits to assess its compliance with workplace laws,” Ms Parker said.

“This matter demonstrates the importance of employers placing a high priority on compliance, including with all clauses in their Enterprise Agreements. Suncorp’s incorrect application of particular clauses has led to underpayment of basic employee entitlements and a large back-payment bill.”

“Any employer who needs help should contact the Fair Work Ombudsman for free advice.”

Suncorp must make a $520,000 contrition payment to the Commonwealth Consolidated Revenue Fund, under the EU.

In addition, the organisation must reportedly operate an employee information channel for 60 days; provide appropriate training to relevant staff; and provide a signed letter of assurance to the FWO from their Group Executive, confirming they are now compliant.

Source: Fair Work Ombudsman

(Quotes via original reporting)

In Australia, banking, insurance and wealth management services provider Suncorp has back-paid staff about $32 million, including interest and superannuation and entered into an Enforceable Undertaking (EU) with the Fair Work Ombudsman, Fair Work Ombudsman reports.

Suncorp self-reported breaches to the FWO in 2020. Suncorp Staff Pty Ltd, Suncorp Insurance Services Limited and Australian Associated Motor Insurers Pty Limited (AAMI) (together, Suncorp) provide services in Australia and New Zealand.

Suncorp reportedly underpaid more than 15,800 employees’ minimum wages between May 2014 and March 2022 through its inconsistent application of the term ‘Rostered Employee’ and the Rostered Employee clause (where these employees were entitled to shift penalties) in its Enterprise Agreements.

The underpayments and EU both relate to the companies’ insurance arm.

Suncorp’s inconsistent use of ‘Rostered employee’ and misunderstandings of appropriate entitlements under a self-service process led to the underpayment of entitlements including overtime, shift loadings, weekend penalties, annual leave loading, public holiday loadings, minimum rate of pay, long service leave, redundancy, payment in lieu of notice, meal allowances and superannuation.

Suncorp identified underpayments after starting an internal review of specific pay and leave practices and its rostering systems.

The underpaid employees - both current and former - worked across the nation in a variety of roles in the insurance arm of the three companies, including as advisors, assessors, customer support staff, technical staff, team leaders and managers.

Suncorp has back-paid more than 99 per cent of the more than $32 million owed already, including having paid about $26 million in wages and entitlements, $4.5 million in interest and $1.4 million in superannuation.

Individual payments reportedly range from $1 to $54,951, with an average underpayment of $1,687 for each impacted employee. The remaining underpayments must be rectified by September 2023.

Fair Work Ombudsman Sandra Parker stated that an EU was appropriate because Suncorp had cooperated and demonstrated a firm commitment to rectifying underpayments.

“Under the Enforceable Undertaking, Suncorp has committed to stringent measures to ensure its employee are paid correctly in the future. These measures include engaging, at the company’s own cost, two independent annual audits to assess its compliance with workplace laws,” Ms Parker said.

“This matter demonstrates the importance of employers placing a high priority on compliance, including with all clauses in their Enterprise Agreements. Suncorp’s incorrect application of particular clauses has led to underpayment of basic employee entitlements and a large back-payment bill.”

“Any employer who needs help should contact the Fair Work Ombudsman for free advice.”

Suncorp must make a $520,000 contrition payment to the Commonwealth Consolidated Revenue Fund, under the EU.

In addition, the organisation must reportedly operate an employee information channel for 60 days; provide appropriate training to relevant staff; and provide a signed letter of assurance to the FWO from their Group Executive, confirming they are now compliant.

Source: Fair Work Ombudsman

(Quotes via original reporting)