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The Fair Work Ombudsman has commenced proceedings in the Federal Court against the Commonwealth Bank of Australia and Commonwealth Securities Limited (CommSec), for alleged contraventions of the Fair Work Act for failing to pay 7,425 workers almost $16,5-million.
Australia’s largest bank disclosed to the Fair Work Ombudsman and the Australian Securities Exchange in 2019 that it was completing a company-wide review of compliance with its enterprise agreements since 2010 and identified contraventions.
Impacted staff performed various roles nationally, but most were in customer service roles.
Following an investigation, the ombudsman is alleging that the bank and CommSec breached clauses of its enterprise agreements that required both companies to ensure that staff paid under these agreements and Individual Flexibility Arrangements were better off overall.
The ombudsman alleges that both companies failed to undertake reconciliations to ensure that employees were not paid less overall compared to the applicable industrial instruments, and make top-up payments for any shortfall.
This led to staff being paid less than their lawful entitlements between October 2015 and December 2020.
Fair Work Ombudsman Sandra Parker said improving compliance in large corporates is a priority.
“We allege that Commonwealth Bank Australia and CommSec failed to meet their lawful obligations to ensure employees were better off overall, which led to thousands of employees across the country being financially disadvantaged year after year,” Parker said.
“Businesses have a responsibility to their employees, customers and the Australian community to get it right by prioritising workplace law compliance, investing in their payroll systems and conducting audits. Boards should treat the lawful payment of their employees as a core governance requirement.”
The regulator also alleges that, for staff paid under Individual Flexibility Arrangements, the companies failed to ensure that workers were better off overall than if they were paid under the enterprise agreements between October 2015 to June 2020.
The Fair Work Ombudsman further alleges that the bank and CommSec also applied invalid arrangements to some staff, leading to a failure to pay various entitlements, including minimum rates, overtime, weekend and public holiday penalty rates, and some allowances.