G8 launches Remediation Program to address Award Compliance issues post Internal Review

A review undertaken by G8 Education ahead of the roll out of a new Human Resources Information System has found inadvertent issues of non-compliance with two Awards over a six and a half year period.

The issues relate to irregularities in the payment of overtime, minimum engagement periods and agreed hours of work and allowances for educators under the Children’s Services Award and Educational Services (Teachers) Award, with many cases centering on a lack of documentation confirming agreed hours paid.

While the final number of team members impacted by the error is yet to be finalised, early estimates indicate that approximately 27,000 team members may have been impacted.

Preliminary analysis of direct wages plus on-costs has indicated that the total estimated value of the shortfalls has been estimated at between $50 million and $80 million over the six and a half year period, amounting to around 1.5 per cent to 2.0 per cent of wages across the Group during that time frame.

$12 million has been provided in FY2020 to cover the expected costs of remediation this year, with the balance to be allocated over the prior periods between 1 July 2014 to 31 December 2019. 

In making the announcement, G8 also confirmed that they have self-reported the irregularities to the Fair Work Ombudsman, committing to ongoing engagement while the Remediation Program is executed. 

“The Group deeply regrets that these pay errors have occurred,” CEO Gary Carroll said. 

“We apologise unreservedly to any affected team member. As soon as we identified and quantified this issue, we initiated a remediation program to ensure they will be paid every dollar they are owed. The commitment of our people – particularly during the enormous challenges of the past year – is the key to our success. We are determined to ensure this issue can never be repeated.”

The remediation program is expected to be completed by 31 July 2021, with the new rostering system, designed to automate certain award compliance and improve visibility, scheduled to be fully implemented across G8’s network by the end of H1 CY21. The Group does not expect any material impact to wage costs in future years as a result of the identified issues.