Corporate bodies probes irregularities
The Fair Work Ombudsman has launched an investigation after evidence emerged that failed electronics chain Dick Smith might have underpaid its employees. This follows yesterday’s statement by Australian Securities and Investments Commission (ASIC) that it has commenced inquiries into whether its prospectus adequately disclosed its true state of affairs ahead of its $520 million initial public offering in December 2013.
The revelations have surfaced as Dick Smith’s receivers and managers dig through the financial embers of the company which collapsed early last month.
In a statement today to the ABC, a spokeswoman for the Ombudsman said Dick’s Smith’s receivers and managers Ferrier Hodgson had contacted them about the possible underpayments to 3,200 workers.
“We are now making our own independent inquiries with a view to working co-operatively with the receivers … and those workers who have been impacted,” a spokeswoman said.
The news of the potential underpayments was released to the public yesterday after Ferrier Hodgson discovered the discrepancies, worth as much as $2 million, during its investigation into Dick Smith’s books to determine what went wrong and what can be recovered for creditors.
Ferrier Hodgson receiver James Stewart said that the underpayments, which go back to 2010, do not appear to be deliberate.
“The underpayment of entitlements appears to reflect an incorrect application of the relevant industrial award,” Stewart said in a statement released yesterday.
The Fair Work Ombudsman’s office says it will be getting in touch with Dick Smith employees which might have been underpaid.
The underpayments could also concern Woolworths, which owned Dick Smith in 2010 before selling it to private equity.