Hugo was “shocked” to learn that his employer, grocery delivery company Send, was placed under voluntary administration in early May.
Most important points:
- Grocery delivery company Send was liquidated on June 7
- Former workers say many migrant workers cannot claim unpaid wages
- Federal government again commits to reforming “unfair” settlement
That shock quickly turned into anger when he learned that after seeking legal advice, he would be unable to recover more than $10,000 in wages and rights that he owes.
“I’m never going to see my money again,” said Hugo, who refused to use his last name for fear it could affect future visa or residence applications.
As one of Send’s store managers, Hugo was on a full-time contract and paid taxes, but as a temporary visa holder, he is not eligible to file a claim through a federal government scheme.
That arrangement — the Fair Entitlements Guarantee (FEG) — can cover certain unpaid labor rights for eligible workers who lose their jobs because of employers liquidation or bankruptcy.
Employees can only enter the scheme if they are an Australian citizen, hold a permanent visa or a special category visa for New Zealanders.
“This means that international students, those on working holiday visas and other temporary visa holders are missing 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 entitlement to the scheme “to migrant workers with labor rights.”
“The government is carefully considering the design of this policy and plans to introduce legislation to deliver on this commitment,” a spokesperson said.
“The timing of this is a matter for the government.”
Employee says majority of employees send temporary visa
It is unclear whether that policy change can be applied retroactively.
It’s also not clear how many of Send’s 300, mostly informal, workers in Melbourne and Sydney are now unable to recoup 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 an estimated 70 percent had some sort of temporary visa.
Hugo said many of the delivery drivers were international students.
“All those people are not going to see the money [they’re owed] and I don’t know what to tell them,” he said.
Indian student Dhvani Sutariya was employed as a casual delivery man at Send, working about 20 hours for four or five days in a standard week.
When the company was placed under administration, she owed about $2,100 in unpaid wages and duties.
She said she was struggling to pay the rent and needed to find another job quickly to survive.
“I’m still hoping to get my money back,” she said.
Send was liquidated on June 7 after a second creditors’ meeting that same day decided to liquidate the company, according to Worrells, who now oversees the liquidation.
A spokesperson for Worrells said employees who do not have access to the government scheme can still receive payment for outstanding employee claims if “sufficient recoveries are made in the liquidation.”
Founder and former chief executive officer Rob Adams said he was “deeply compassionate” to employees who were unable to access the government scheme.
“Ensuring the safety and livelihood of our employees has been central to our business model at Send,” said Mr. Adams.
“That’s why we chose to hire people directly and offer a fixed hourly wage, rather than working with third-party contractors who are paid per order, as is the case with delivery services such as UberEats.”
Government regulation ‘just not fair’
Ms Hemingway said three years ago a Migrant Workers Taskforce made many recommendations to help such workers, including extending the FEG to all temporary visa holders.
Proponents said there was bipartisan support for implementing the recommendations at the time.
The Attorney General has confirmed to the ABC †the government has committed to implement the recommendations of the Taskforce Migrant Workers”.
Ms Hemingway welcomed that commitment but said it was time for action.
She said the exclusion of temporary visa holders from the scheme was “just not fair”.
“One with access to a portion of their unpaid wages, and one who left with nothing when they both lost their legal rights through no fault of their own?”
‘Heartbreaking for all involved’
Send started operating during the COVID-19 pandemic, saying it was “Australia’s first digital supermarket”.
The Send app had more than 46,000 registered users and promised to deliver messages “to your door within 10 minutes”.
The company’s network had about 13 locations, including several “dark supermarkets” in and around central Sydney and Melbourne.
Send has spent a total of $11 million in its eight months of operation, according to a report sent to creditors on May 30 and filed by Worrells with the Australian Securities and Investments Commission.
The report noted that the company’s main operating expenses were salary and wages, which cost more than $5.5 million.
“The significant salary and payroll costs incurred are related to the company’s business model of delivering groceries within 10 minutes, as the company had to hire a large number of employees to meet its business model,” the report said. .
“Therefore, despite management efforts to reduce the losses incurred, it is clear that the company’s business model was not sustainable without outside financing.”
Adams said 2022 had “the most pessimistic global economic environment since the 1970s”.
“Despite our efforts and showing exceptional growth, we were unable to raise the capital necessary to remain operational, a heartbreaking result for all involved,” he said.
“I’m afraid this isn’t the last we’re seeing of companies experiencing similar results over this period.”
The report also noted that Send owed more than $1.2 million to employees for wages, retirement, leave and “austerity.”
In a press statement in early May, Worrell’s then-administrator Matthew Kucianski said Send was facing “unique funding challenges given the makeup of its international investors.”
“Like many tech start-ups, Send had a significant cash flow that was being leveraged to increase its market share,” he said.
“Send has managed to build a leadership position in grocery delivery, but as a start-up, it needs continued financial support.”
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