Australia’s Star Entertainment Group will compensate current and former staff for around AU$13 million (US$9.2 million) worth of underpayments identified as part of a retrospective wage review.
The underpayments date back six years with Star revealing that, based on modern awards, some staff were found to not be better off overall as their annual salary was not sufficient to compensate for their equivalent award entitlements such as overtime and penalty rates.
The AU$13 million in remediation payments will be included in the company’s accounts for the six months to 31 December 2021 comprising estimated back payments, interest and superannuation contributions.
According to Star, the number of staff on annualised salaries underpinned by an award during the six-year period in question was 2,200 while the total amount of wages paid to employees during the period totalled AU$3.3 billion.
The Fair Work Ombudsman and United Workers Union have been informed of the error while the company said it has now improved its processes, systems and training while putting a plan in place to ensure salaried team members’ pay is correct moving forward.
“We apologise to any team member impacted by the payment shortfall and we are committed to doing the right thing by acting transparently,” said Star Entertainemnt Group Managing Director and CEO, Matt Bekier. “Our priority is to address this issue and to ensure that it doesn’t happen again.”
The timing of the error is not ideal for Star, which is set to face a public inquiry starting in March as part of a regular review into The Star Sydney and whether it remains suitable to hold a casino licence.
The inquiry follows media reports alleging Star had enabled suspected money laundering, organized crime, fraud and foreign interference by cultivating high-roller gamblers with links to organized crime while ignoring red flags over the source of client funds. Star has denied the accuracy of those reports.
The company also said Monday that it expects to record a net loss of between AU$73 million and AU$75 million for the six months to 31 December 2021 due to the impact of COVID-19 on its businesses. Star is due to report its half-year results on 17 February.
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