Star Entertainment has become the latest Australian casino giant that admitted to underpaying its staff, with about 2,200 staff members denied about AU$13 million in 6 years.
At the beginning of the week, the gambling behemoth, which currently operates casino venues in Brisbane, Sydney, and on the Gold Coast, revealed that it had informed local gambling regulators and worker unions about the issue after finding out that it had underpaid thousands of its employees back to 2016. The mistake was discovered during a retrospective review of the wages received by salaried team members, which found that the salaries of some staff members did not provide adequate coverage of overtime and penalty rates.
The chief executive officer of Star Entertainment, Matt Bekier, apologised to any of the company’s team members that might have been affected by the payment shortfall. Mr Bekier explained that addressing the issue and making sure it would not happen again would be one of the paramount priorities of the gambling giant, who would like to do things right and act transparently.
Reportedly, Star Entertainment’s upcoming financial results would suffer an AU$13-million blow as it begins the process of repaying the underpaid staff, plus interest. According to expectations, this would increase the first-half loss experienced by the company to the range of between AU$73 million and AU$75 million, following another hard trading period for the Australian gambling giant earmarked by the Delta and Omicron waves of the coronavirus pandemic.
The casino operator revealed that it plans to take the AU$9.2 million in its upcoming financial results and use them to start the process of repaying with interest.
Revelations of Staff Underpayments Comes amid Money-Laundering Scandal and Tougher Regulatory Practices
The saga of Star Entertainment is the latest in a series of underpayment scandals involving some of the major employers in Australia over the past few years, including the Commonwealth Bank, Woolworths, Coles, the ABC, Qantas and Wesfarmers.
As revealed by the company itself on February 7th, the Australian gambling company had gotten in touch with the Fair Work Ombudsman and the United Workers Union to inform them about the payment issues. Star Entertainment also noted that the underpayments amounted to just 0.4% of the overall payment of AU$3.3 billion that had been received by the company’s staff over this period.
Star Entertainment operates the Pyrmont casino in the Darling Harbour of Sydney, as well as the Treasury in Brisbane and the Star Grand on the Gold Coast. The Australian gambling giant is currently building a new gambling venue at the Queen’s Wharf precinct of Brisbane. The gambling facility, which is being currently constructed and which already has its Dorsett hotel and apartments tower on the Gold Coase fully completed, is expected to start operation by the end of 2022.
As Casino Guardian reported, the company, which is among the largest gambling operators in Australia, is also facing an ongoing investigation of the country’s financial regulators following some money-laundering allegations. In October 2021, investigations led by the Sydney Morning Herald and 60 Minutes found that the company was involved in illegal activities, including large-scale fraud, money laundering, foreign interference and organised crime. As it was revealed at the time, Star Entertainment’s board was fully aware of the aforementioned illegal activities but decided not to take action.
As a result of the findings, 2 law firms have prepared class-action lawsuits against the Australian gambling giant, with their actions leading to a significant decline in its share price. Local gambling regulatory bodies are looking to clean up the country’s gambling sector by adopting a stricter approach not only against Star Entertainment but also against Crown Resorts, as the company is facing multiple operating licence suspensions as a result of damning reports of ties to criminal activities.
The share price of Star Entertainment initially fell to a six-day low on Monday trading but has since recovered.
- Author
Olivia Cole
