Hugo was “shocked” when he found out his employer, grocery delivery company Send, had gone into voluntary administration in early May.
Key points:
- Grocery delivery company Send went into liquidation on June 7
- Former employees say many migrant workers will not be able to reclaim unpaid wages
- Feds recommit to reform ‘unfair’ regime
This shock quickly turned to anger when he discovered, after seeking legal advice, that he would not be able to recover more than $10,000 in wages and benefits owed to him.
“I will never see my money again,” said Hugo, who declined to use his last name for fear it would impact future visa or residency applications.
As a Send store manager, Hugo had a full-time contract and paid taxes, but as a temporary visa holder, he is not eligible to make a claim through a government program. federal.
This scheme – the Fair Rights Guarantee (FEG) – can cover certain unpaid employment rights for eligible employees who lose their jobs due to the liquidation or bankruptcy of the employer.
Workers can only access the scheme if they are Australian citizens, permanent visa holders or New Zealander Special Category Visa holders.
“That means international students, people on working holiday visas and other temporary visa holders are out,” said Catherine Hemingway, legal director of the Migrant Justice Institute.
“It’s discrimination.”
The Attorney General’s Department confirmed to the ABC that the federal government plans to extend eligibility for the program “to migrant workers with employment rights.”
“The government is carefully considering the design of this policy and intends to introduce legislation to implement this commitment,” a spokesperson said.
“The timing of this is a matter for the government.”
Worker says majority of Send employees have temporary visas
It is unclear whether this policy change will be applied retrospectively.
It is also unclear how many of Send’s 300 mostly casual employees in Melbourne and Sydney are unable to recover their wages using the scheme because they are on temporary visas.
But Hugo estimated that the majority of the company’s employees would be affected.
He said he led a team of 10-15 delivery drivers and he estimated 70% of them had some type of temporary visa.
Hugo said many of the delivery people were international students.
“All these people won’t see the money [they’re owed] and I don’t know what to tell them,” he said.
Indian student Dhvani Sutariya was employed as an occasional delivery man in Send and in a standard week worked around 20 hours over four or five days.
When the company went into administration, it owed approximately $2,100 in unpaid wages and duties.
She said she was struggling to pay her rent and had to quickly find another job to survive.
“I’m still hoping to get my money back,” she said.
Send went into liquidation on June 7 after a second meeting of creditors on the same day decided to liquidate the company, according to Worrells, who is now overseeing the liquidation.
A spokesperson for Worrells said employees who are unable to access the government scheme may still receive payment for unpaid employee entitlements if “sufficient recoveries are made on liquidation”.
Send founder and former CEO Rob Adams said he was “deeply sympathetic” to employees who couldn’t access the government scheme.
“Caring about the safety and livelihoods of our employees was central to our business model at Send,” Mr. Adams said.
“That’s why we’ve chosen to employ people directly and offer stable hourly wages, instead of working with third-party contractors who are pay-as-you-go, as is the case with delivery such as UberEats.”
The government program ‘just not fair’
Ms Hemingway said three years ago a task force on migrant workers made many recommendations to help these workers, including extending the FEG to all temporary visa holders.
Proponents said there was bipartisan support for implementing the recommendations at the time.
The Ministry of the Attorney General confirmed to the CBA “the government is committed to implementing the recommendations of the task force on migrant workers”.
Ms Hemingway welcomed the commitment but said it was time to act.
She said excluding temporary visa holders from the scheme was “simply not fair”.
“One having access to part of their unpaid wages, and the other with nothing when they both missed their legal rights through no fault of their own?”
“Heartbreaking for everyone involved”
Send began operating during the COVID-19 pandemic and said it was “Australia’s first digital grocery store”.
The Send app had over 46,000 registered users and promised to deliver groceries “in less than 10 minutes to your doorstep”.
The company’s network had around 13 locations, including several “dark grocery stores” in and around central Sydney and Melbourne.
Send spent a total of $11 million in the eight months of its operation, according to a report sent to creditors on May 30 and filed with the Australian Securities and Investments Commission by Worrells.
The report noted that the company’s major operating expenses were wages and salaries, costing more than $5.5 million.
“The large wage and salary expense incurred is associated with the business model of the 10-Minute Grocery Company, as the company needed to employ a large number of employees in order to meet its business model,” the report said. report.
“As a result, despite management’s attempts to reduce the losses incurred, it is clear that without external financing, the company’s business model was not sustainable.”
Mr Adams said 2022 had ‘presented the most pessimistic global economic climate since the 1970s’.
“Despite our best efforts and exceptional growth, we were unable to secure the capital necessary to remain operational, a heartbreaking result for everyone involved,” he said.
“I’m afraid this won’t be the last time we’ve seen companies experience similar results during this time.”
The report also noted that Send owed more than $1.2 million to employees for salaries, pensions, time off and “trenchments.”
In an early May press release, Matthew Kucianski, then a director of Worrells, said Send faced “unique funding challenges given the makeup of its international investors.”
“Like many tech start-ups, Send had a significant cash burn that was deployed to grow market share,” he said.
“Send has managed to carve out a leadership position in the grocery delivery space, but as a start-up, it requires continued financial support.”
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