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Land council seeks legal advice after audit finds 630 employees were underpaid $1.36m

David Prestipino -

One of Western Australia's biggest Indigenous bodies says it will take time to compensate 630 current and former employees who were underpaid $1.36 million under an enterprise agreement which commenced in 2014.

Kimberley Land Council on Monday disclosed the underpayments, which occurred between July 1, 2016 and October 22, 2019, after an internal payroll audit revealed the error. The sum does not include lost interest and superannuation. 

KLC chief executive officer Tyronne Garstone, who was deputy CEO at the time the new enterprise agreement was being negotiated with staff, told National Indigenous Times on Tuesday a hotline and email account had been established to help identify and repay affected employees, most of whom no longer work at the corporation and may not know they had been paid below the mandated base rate, compared to the modern award rate.

Mr Garstone said the 2014 EA took two-and-a-half years to negotiate, compounding the total amount of underpayments between July 2016 and late October 2019, but said the KLC had sufficient funds and was determined to repay affected employees and casual workers the varying payments owed, which would depend on their level of pay during the period.

"We have significant cash reserves ... so no jobs will be lost. Obviously, there will be a little period of time over the next six to 12 months, because when we're talking about trying to pay 630 former and current employees, some of who may not necessarily even be in the country," he said.

Some of the KLC's current 130 staff affected would be more easily identifiable, but the corporation has established a hotline and email address for former employees who may have been underpaid during the period.

Mr Garstone said the land council, one of the biggest in WA's vast Kimberley region - where it works with Indigenous groups to secure Native Title recognition, conduct conservation and land management activities, and develop cultural business enterprises - voluntary disclosed the underpayments after an internal audit.

He suggested the firm that in 2018 told the KLC its payments were compliant with wage obligations could also be implicated, given interest was likely to be sought on the payment shortfalls to the hundreds of workers during the three-year period.

Subsequent legal advice from two other firms contradicted the initial advice provided to the KLC, which led to the in-depth audit and identification of underpayments, after a current staff member raised the issue.

"An employee spoke up, so we've done an audit ourselves and then received advice from a second legal firm, and also then a third, and their advice on the matter clearly showed the original advice we got was incorrect," Mr Garstone said. 

"We're still exploring options, because even though there's a $1.36m underpayment of salary, there's also an interest component to that, which we wouldn't have had to pay, had we had the right advice at the time.

"We're seeking legal advice on on the original advice that we got and potentially pursuing any additional costs."

Mr Garstone, who last week presented the audit findings to the KLC board, which he said had no hesitation presenting the error to the Fair Work Ombudsman, which was now investigating.

Nolan Hunter, KLC chief executive at the time the enterprise agreement was being negotiated and staff underpaid, told National Indigenous Times the issue was unfortunate and came down to the corporation receiving incorrect advice.

"It wasn't a deliberate mistake ... you know, we weren't bloody minded about it," said Mr Hunter, who left the KLC in 2020.

"We did our due diligence on proper process, and apparently the advice we got was wrong, but the KLC will use its resources to backpay who they have to," said Mr Hunter, who is the current co-chair of Reconciliation WA and was a key figure in the 'Yes' campaign for the Voice to Parliament.

The KLC is one of the biggest employers in the northern WA region, with about 130 staff across its divisions.

Underpayments for certain employees under the Kimberley Land Council Enterprise Agreement 2014 that fell below the base rate of pay as per the underlying modern award after, are entitled to repayments.

The KLC is in the process of contacting impacted staff, but encouraged anyone who was employed between 1 July 2016 to 22 October 2019, to contact the KLC team at [email protected] or the special enquiries hotline on 0447 087 981, with the following information:

1.     First and last name
2.     Phone number
3.     Email address
4.     Date of birth

More information on the matter can be found on the KLC website.

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