Tax­pay­ers face hefty bill for Foodora’s $8m debt

The Australian - - THE NATION - EWIN HANNAN WORK­PLACE EDI­TOR

Ad­min­is­tra­tors for food de­liv­ery com­pany Foodora have found the com­pany mis­clas­si­fied its ca­sual work­ers as in­de­pen­dent con­trac­tors and owes more than $8 mil­lion in wages, su­per­an­nu­a­tion and tax.

Tax­pay­ers could be left with a sub­stan­tial bill af­ter Foodora’s par­ent com­pany, the Ger­man­based De­liv­ery Hero, said it would pay just $3m to cover its Aus­tralian debts, de­spite fore­cast­ing rev­enues of $1.2 bil­lion on Wed­nes­day.

In what unions de­scribed as a “world first”, Wor­rells Sol­vency and Foren­sic Ac­coun­tants said they had “now reached the po­si­tion that … it is more likely than not that the ma­jor­ity of the de­liv­ery rid­ers and driv­ers should have been clas­si­fied as at least ca­sual em­ploy­ees of the com­pany rather than in­de­pen­dent con­trac­tors”.

The ad­min­is­tra­tors es­ti­mated the work­ers are owed up to $5.54m and tax­pay­ers might have to foot the bill by pay­ing out more than $1.5m in owed wages through the Govern­ment’s Fair En­ti­tle­ments Guar­an­tee scheme.

“We have as­sumed the FEG may pay out 30 per cent of the to­tal quan­tum of the ca­sual un­der­paid wages cal­cu­la­tion, be­ing an amount of $1,577,006 in line with our in­ves­ti­ga­tions to date,’’ the re­port said.

The ad­min­is­tra­tors re­ported that the Aus­tralian Tax­a­tion Of­fice es­ti­mated it was owed $2.138m, Rev­enue NSW was owed $558,074, and rev­enue agen­cies in Vic­to­ria and Queens­land would make claims to­talling $400,000.

Foodora an­nounced in Au­gust that it was pulling out of Aus­tralia, and sub­se­quently ap­pointed ex­ter­nal ad­min­is­tra­tors. It said it op­er­ated on the ba­sis that the ma­jor­ity of its rid­ers and driv­ers were con­trac­tors. Le­gal ad­vice sup­port­ing the po­si­tion has not been pro­vided to the ad­min­is­tra­tors.

Trans­port Work­ers Union na­tional sec­re­tary Michael Kaine said the ad­min­is­tra­tors’ find­ing that the work­ers had been mis­clas­si­fied was “an im­por­tant day for work­ers, not just in Aus­tralia, but world­wide”.

“This con­firms what work­ers and unions have been say­ing for years: that work­ers de­serve rights to min­i­mum pay, sick leave, pay­ment when they are forced off the job be­cause of in­jury, the right to col­lec­tively bar­gain, and the right to chal­lenge an un­fair dis­missal,’’ he said.

“De­spite ow­ing over $8m in to­tal to Aus­tralian work­ers and tax­pay­ers, De­liv­ery Hero will throw just $3m at them and hope to walk away.

“We need ur­gent govern­ment reg­u­la­tion to pro­tect vul­ner­a­ble work­ers and tax rev­enues from wealthy tech com­pa­nies which don’t want to pay their way.”

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