Jobs to go as agency wound up

Up to 70 employees will ultimately be made redundant if all FEO’s assets are sold and the organisation will need to raise more than $700,000 to pay out all its remaining debts.

Liquidator Jason Stone said former employees would receive all their leave and redundancy entitlements due to government guarantees, but unsecured creditors were another matter.

“If we have to wind everything down and send the equipment to auction it would be unlikely that there would be a dividend paid to the unsecured creditors,” he said.

Mr Stone said the not-for-profit owed $550,000 to former employees and a further $170,000 to unsecured creditors, but complicating matters were claims made at the meeting by an FEO employee that staff had been underpaid.

One former employee’s wife, who gave her name as Megan, said while the government guarantee was reassuring, the whole process had been an ordeal for her husband.

“We’ve found out through this process that they’ve been underpaying staff under the wrong award,” she said.

“We’ve got no income for him now and it could be up to 16 weeks before he sees his redundancy and that’s not the back pay that he’s owed for being underpaid for five-and-a-half years.”

An unsecured creditor who did not wish to be named said she shared Megan’s concerns.

“Now that it’s gone into liquidation they will make efforts to try and make sure the staff are paid and I think that’s appropriate,” she said.

“What I am concerned about though as a creditor is that there is also now a claim for unpaid back wages for some of the staff members.

“It just goes to show that the company was not in a good situation for quite some time.”

Mr Stone said he was looking into the underpayment allegations.

“My understanding is that one of the employees has raised an issue in that they weren't getting paid the appropriate rate when they were working at the Eaglehawk site,” he said.

“I think they’ve only become aware of that recently when they moved to the Hepburn site so I don't know whether there’s any truth to that or not at this stage, we need to investigate that.”