Disability support provider agrees to $2 million back pay deal with workers

More than 1,300 staff employed by disability service provider Yooralla have received a combined $2.05 million in back pay following a long-running clerical error, the Fair Work Ombudsman has confirmed.

The not-for-profit organisation, which operates across Melbourne and regional Victoria, confirmed it had entered into an enforceable undertaking with the Ombudsman after rectifying the mass underpayments to 1,389 current and former employees, which ranged from less than $1 to over $22,000.

Most of the underpaid workers were casual disability support workers based in Melbourne with the underpayment period stretching from March 2018 to March 2024.

The Ombudsman said Yooralla staff received an average back-payment of about $1,470.

Fair Work Ombudsman Anna Booth said Yooralla had fully cooperated with her organisation's investigation and welcomed their commitment to rectifying the pay discrepancy.

"The matter serves as a warning of the significant long-running problems that can result from an employer not prioritising compliance with minimum pay laws," she said.

"There are too many organisations that are placing far too low a priority on ensuring their payroll systems are compliant.

"[Employers need to] have a system in place to regularly check they are providing their employees with all lawful minimum entitlements.

"Employers should also be aware that improving compliance in the disability support services sector is a priority for the Fair Work Ombudsman."

Yooralla first became aware of its issues when it received a query from a casual employee about whether they were receiving the correct shift loading entitlement.

That prompted Yooralla to conduct a comprehensive review, including engaging an external consultant, which led to the organisation self-reporting its non-compliance to the Fair Work Ombudsman in 2024.

Health and Community Services state secretary Paul Healey said Yooralla deserved credit for self-reporting the pay discrepancy.

"It's one of those rare cases where the employer recognised the underpayment and self disclosed," he told the ABC.

"Usually there's a barney or a blue about how much the employer has to pay, when they had to pay it. But thankfully in this case, Yooralla took a collaborative approach with the union and employees.

"More than $2 million is a huge amount and disability support are running tight margins, so we recognise this has been done in a spirit of cooperation."

A Yooralla spokeswoman said the organisation had committed to enhance its payroll process, upgrade its systems and provide additional compliance monitoring as part of the undertaking.

"Yooralla voluntarily disclosed these contraventions to the Fair Work Ombudsman and have worked cooperatively throughout the process," the spokeswoman said.

"These errors were not deliberate and arose from system and process failures within our payroll administration.

"We apologise unreservedly for these errors and acknowledge the impact they have had on affected employees."