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OTR class action for alleged wage theft in Adelaide

SA is one of the worst states for wage theft, although rarely reported by the media. OTR has form. The Liberal state government has done nothing to stop it. Know your employment rights. This edited story is from the ABC. 

South Australia’s largest private employer, convenience store chain OTR, is accused of wage theft that could amount to $70 million in underpayments to thousands of employees.

A class action on behalf of 1,050 workers against Shahin Enterprises, owner of the chain also known as On The Run, was lodged with the Federal Court on Wednesday (13 May 2020).

Adero Law, representing the workers, accuses the company of failing to pay overtime, underpaying staff and misusing its traineeship program as a method to reduce workers’ pay. Adero Law claims at least 6,000 OTR workers across South Australia were put on similar programs by the company, and allegedly received $3 an hour less than they were entitled to.

It estimates more than 8,000 current or former employees of the chain are eligible to join the class action and claims Shahin Enterprises could be liable to pay back between $50 million and $70 million in unpaid wages and entitlements.

The allegations, which date back to 2014 and span across all 145 OTR stores in South Australia, involve eight different wage minimisation tactics that allegedly enabled Shahin Enterprises to underpay its staff.

In a statement to the ABC, a spokesperson for OTR said while the company would correct payment errors “brought to its attention”, it had “no choice but to defend the case”.

One of the lead claimants is Paul Young, who worked at an OTR service station at Parafield, north of Adelaide, between 2013 and 2019. Mr Young started out on a traineeship program, and would remain under that pay bracket until 2015.

Paul Young says he was classed as a trainee employee between 2013 and 2015. Mr Young said OTR was initially a good company and provided shifts that suited his needs as a single father of two children with disabilities. But, by the end of 2018, things had changed.

“It got harder and harder,” he said. “More expected, more work placed onto me and nothing for it. Barely even a thank you.”

Mr Young alleges he was required to work overtime before and after his shifts, and couldn’t take allocated meal breaks. Like other applicants, Mr Young also alleges pay was deducted from his salary to cover uniform costs and police checks, despite OTR’s policy of reimbursing workers for these costs upon termination of their employment.

‘Voluntary overtime’ a routine tactic

Lawyer said workers were instructed by OTR to sign a “voluntary overtime” form on the commencement of their employment, which stated any overtime they worked was voluntary and as such paid at their respective ordinary rates of pay. But it is alleged the company would then require employees to work overtime in line with its own staffing requirements, which included shifts on public holidays.

In 2015, the ABC’s 7.30 program revealed former employees’ allegations that OTR was running a sham training program, designed to keep wages low. The report drew the attention of the State Government and enquiries were made with the company.

In March, the Federal Court upheld a separate decision by South Australia’s Employment Tribunal to award $2,342 to an OTR employee who had been underpaid.

Adero Law previously began looking into possible wage theft through the company’s traineeship program, which it said highlighted a pattern of “serial offending”.

Lawyer Kellie Pledger, who spearheaded the investigation, said Peregrine Corporation, a parent company of OTR, has been involved in several claims at the tribunal.

“The exploitation of workers has become a business model,” she said. “The common feature among sophisticated businesses subject to recent wage scandals is that they have systemically underpaid employees.”

The law firm said it surveyed more than 1,000 workers from the OTR chain, all of whom allege they had not been paid their lawful entitlements.

The full story can be found here:

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