Southern Cross Care to repay $11.7m after years of staff underpayments

Southern Cross Care (NSW & ACT) will repay more than $11.7 million in wages, interest and superannuation to 5500 current and former employees.

It has entered into an Enforceable Undertaking with the Fair Work Ombudsman (FWO) following years of widespread underpayments across its aged care, home care and retirement living services.

The not‑for‑profit provider, which operates 27 retirement communities and 27 residential care homes across New South Wales and the ACT, has already reimbursed the majority of affected staff. So far, 3603 employees have received $10.1 million, with individual repayments ranging from less than a dollar to $44,593, including interest and superannuation. The average back‑payment was $1716.

The underpayments occurred between July 2017 and October 2024, affecting home care workers, assistants in nursing, registered and enrolled nurses, facility managers, diversional therapists, cooks and handypersons. Casual, part‑time and full‑time employees were all impacted.

Fair Work Ombudsman Anna Booth said the Enforceable Undertaking was appropriate given the provider’s cooperation and commitment to fixing the problem.

“Southern Cross Care has acknowledged its breaches and the underlying issues, and taken steps to rectify them and ensure future compliance,” Ms Booth said.

Employees were underpaid across a wide range of entitlements, including overtime, weekend penalties, shift loadings and annual leave loading. The organisation also failed to correctly apply various allowances required under its enterprise agreements. These errors meant that staff across multiple roles and employment types were not receiving their lawful entitlements for years.

Southern Cross Care discovered the issue after an employee queried overtime payments in 2023, prompting a self‑audit. The organisation then voluntarily reported its non‑compliance to the FWO in November that year.

A Southern Cross Care (NSW & ACT) spokesperson said the organisation “acted immediately – initiating an internal and external review, proactively notifying the Fair Work Ombudsman, and working openly with them throughout.”

“All affected current staff have been properly compensated. We continue to rectify payments for former employees and are strengthening our systems and processes to ensure this does not happen again,” the spokesperson said.

“As a purpose-driven, not-for-profit aged care provider, we deeply value our workforce and the difference they make in the lives of older Australians every day.”

Any remaining unpaid wages will be transferred to the Commonwealth Consolidated Revenue Fund if affected employees cannot be located within 60 days.

“A warning to all employers”

Ms Booth said the case highlights the risks for employers who fail to maintain robust payroll systems.

“This matter serves as a warning of the significant long‑running problems that can result from an employer failing to have appropriate checks and balances,” she said.

“Worker entitlements such as overtime and weekend penalties are important and can soon create a large underpayment bill if they’re not correctly paid.”

Under the Enforceable Undertaking, Southern Cross Care must replace its time and attendance system and commission an independent audit of its compliance. It must also train all staff in the use of the new system, regularly report compliance updates to its Board, and notify all current and former employees about the underpayments.

The organisation is also required to establish multiple channels for staff feedback, including surveys, an anonymous reporting form, monthly team meetings and an external whistleblower hotline.

These measures are designed to prevent future breaches and ensure employees have safe avenues to raise concerns.