Some salaried workers at The Star could see back pay with interest

Posted under Info On By Alan Butler

Australia’s second-biggest casino company will need to come up with about A$13 million in its 1H FY2022 accounts to pad the checks and retirement funds of more than 2000 employees. Star Entertainment Group had been underpaying workers for the last six years.

On Monday, the operator said that it had been in contact with the United Workers Union and the Fair Work Ombudsman to let them know it planned to begin making payments of back pay with interest and contributions to the workers’ preservation super accounts.

The news came from a stock exchange filing wherein Star stated the underpayments had been found during a scheduled six-year review of salaried staff wages (see .PDF here). The statement noted that since the discrepancies were found it had “improved its processes, systems and training and has a plan in place to ensure salaried team members’ pay is correct moving forward.

Star CEO Matt Bekier added:

We apologize to any team member impacted by the payment shortfall and we are committed to doing the right thing by acting transparently. Our priority is to address this issue and to ensure that it does not happen again.

1H FY2022 Financial Results to be Announced February 17

The statement comes ahead of The Star’s 1H FY2022 financial results which will be released on February 17. It has already been known for some time that the numbers will show material impact from a lack of cross-border customer traffic, overall operating restrictions, and outright closures in the face of the worldwide health emergency of COVID-19.

The operator is already reeling from a withering review of its statutory regulatory responsibilities in maintaining a safe and sane gambling environment and has denied claims that it has unwittingly allowed money to be laundered through its gambling floors.

While the impacted employees were found through internal review and the company is already in the process of compensating the affected workers for the shortfall, union representatives look at the issue from another angle as it isn’t a one-off occurrence with a single employer, but something that occurs far too often in many industries.

Imogen Beynon of the United Workers Union called on The Star to fix the situation for workers sooner rather than later.

Beynon said in a statement: “We know from this example and many others that incidences of wage theft and underpayments are reduced when people are covered by a union agreement.

This situation has also brought to light the issues surrounding many companies’ over-reliance on salaries which fall short of the relevant award.”

Some Workers Not “better off overall”

During the six-year period comprising the review, workers were paid about $3.3 billion. While the overall shortfall in pay relative to the expected award is small, individually it had the potential to affect individual team members’ quality of life with basic salary insufficient to properly compensate them for overtime and expected enhanced rates.

Star Entertainment Group Ltd (ASX: SGR) stock has been on a steady rise since January 27 after experiencing a precipitous drop between October 6th and 12th with gains since that time of a rosy 29 percent. A strong first-half operating report later this month is not expected to see any surprises with EBITDA in the positive $30m range and expected normalized net loss over $70m. Stock prices are more likely to be driven by any new COVID variants or surges than the known fundamentals.

Source: Star casino to pay $13 million after ‘wage theft’, The New Daily, February 7, 2022