Idameneo back-pays employees over $15 million

In November 2020, Idameneo Pty Ltd (Idameneo) entered into an enforceable undertaking with the Fair Work Ombudsman (the Ombudsman), having to back-pay approximately $15.3 million to employees.

Idameneo has delivered management services to its 69 medical centres and 13 GP practices, beneath the brand names of parent company Healius Limited, which includes ‘Primary Health Care’ and ‘Primary Dental’.

In late 2018, Healius had reported to the Fair Work Ombudsman (the Ombudsman) that Idameneo had underpaid over 5,000 past and present employees over $12.3 million, due to failing to meet outstanding rates under the Health Professionals and Support Services Award 2020 or Nurses Award 2010.

What form of workplace law did Idameneo contravene?

There were a number of Fair Work Act 2009 (Cth) contraventions included in this matter including:

• An incorrect classification or pay point to some employees;
• Applying an annualised salary rate for salaried employees which did not meet award entitlements;
• Not paying all additional hours worked by waged and salaried employees; and
• Other payroll system errors.

These contraventions led to a large range of underpayments of HPPS Award 2020 entitlements including:

• minimum weekly wages;
• casual loading;
• various allowances; and
• overtime and penalty rates for weekend work and public holiday work.

Consequences of breaching workplace law

In April 2020, it was recognised that Idameneo had back-paid approximately $14 million (inclusive of interest) to 4,018 employees, for underpayments that had occurred between July 2011 and November 2018. The back-payments varied from $1.51 to $131,336 for each individual. However, $880,000 is still to be owed to employees that have not yet been found.

Due to the action of the enforceable undertaking, the underpayments must be corrected within 90 days of signing the enforceable undertaking, or be paid into the Commonwealth’s Consolidated Revenue Fund 30 days after employees have not been able to be found. As employees are found, the Ombudsman will distribute the money.

In response to the enforceable undertaking, Idameneo has undertaken considerable measures at its own cost, to conform with the law and protect both its current and future employees.  The enforceable undertaking also committed Idameneo to pay $400,000 in contrition to the Commonwealth’s Consolidated Revenue Fund.

Key message 

This case with Idameneo serves as a warning and reminder to all employers, that if you do not prioritise or maintain workplace compliance, you risk your reputation, incurring considerable costs in both compliance-related expenses, compensating employees for underpayment of wages and other Award entitlements and contrition-based payments.

We encourage you to contact our Workplace Relations Team on (07) 3872 2222 or at workplacerelations@amaq.com.au, if you have any further questions or queries about award compliance and workplace law.