CBA staff ‘knowingly’ underpaid $ 16 million in massive use of individual agreements


Additionally, the watchdog said the bank had not “knowingly” complied with these obligations, meaning that breaches reach the serious breach threshold and increase potential fines to a maximum of 660,000. $ per offense.

Fair Work Ombudsman Sandra Parker said improving compliance at large companies was a priority.

“We allege that the CBA and CommSec failed to meet their legal obligations to ensure that employees were better off overall, which led to thousands of CBA and CommSec employees across the country to be financially disadvantaged year after year, ”she said.

“Companies have a responsibility to their employees, customers and the Australian community to get it right by prioritizing compliance with workplace laws, investing in their payroll systems and performing audits. Boards should consider the legal payment of their employees as a fundamental governance requirement.

The ABC says a “full remediation program” has been underway since 2018 and the retroactive payment was “essentially complete”.

“The CBA believes that no further compensation payments should be made to employees who are the subject of these proceedings once the existing payments are terminated,” she told ASX.

The alleged underpayments in the FWO lawsuit amount to more than $ 16.44 million between October 2015 and December 2020.

However, the actual total is likely much higher because 2015 is only the first date an employer can be held liable under the six-year limitation period and the bank has been using individual agreements since 2010.

In 2019, the bank announced that it had underpaid some 41,000 employees by $ 53 million as part of a review of its use of individual agreements.

The FWO statement filed in Federal Court says the breaches “were part of a pattern of systematic conduct, spanning more than nine years, affecting a substantial number of employees.”

The bank is committed to its conduct “despite recognizing internally, as early as April 2011, that employees may not be better off overall under individual arrangements,” the watchdog said.

Further, the FWO alleges that the ABC and CommSec misled some employees by telling them that they would be better off under their IFAs between 2018 and 2019 by falsely and “recklessly” claiming that their new salary met their expectations. their legitimate rights.

Instead, says the FWO, human resources staff knew at the time that the agreements were likely to underpay, but “either ignored that risk or were indifferent to that risk.”

Although it assured staff and the Fair Work Commission that it would perform additional annual calculations, the bank would only calculate additional payments if employees complained or inquired, according to court documents.

The FWO said the conduct was part of the bank’s systems approach, as individual agreements were all model agreements not suited to a particular employee’s circumstances.

Staff and human resources sources previously told the Financial analysis that the bank imposed ACIs on new employees upon hiring, with workers claiming they felt they had no choice or did not realize they were giving up their rights.

A human resources manager said he was given a script to sell the individual agreement to the employee warning him otherwise “you are going to be paid a pittance.”

The FWO alleged that the bank’s practice of offering ACIs to prospective employees was illegal and meant that the ACI was invalid or had no effect, meaning that staff should have been paid under of the company agreement.

While the bank suspended ACI’s offer in 2019, it then sought to incorporate the terms of company agreements into annualized wages – the protections of which have become a key part of the financial sector union’s bargaining conflict with the bank this year.

CBA human resources manager Sian Lewis told staff on Monday that the bank had fully cooperated with the FWO and “spent a considerable amount of time looking for the root cause to make sure it doesn’t happen again.”

FSU National Secretary Julia Angrisano said union members “knew the CBA systematically distorted ACIs as ‘contracts’ to undermine the terms of the EBA, effectively lining the pockets of shareholders and corporate executives. wages stolen for almost a decade ”.

“There is no better example of salary theft in Australia. The ABC deserves the book to be thrown at them, ”she said.

She alleged that the bank “lied about ACIs, they knowingly broke terms designed to offer some protection, and then lied again to get people who (due to their early lies) didn’t fully understand their rights at work, vote for an agreement legalizing the same behavior in the future ”.

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