More than 15 Derrimut 24:7 Gym instructors left unpaid in lead-up to ATO wind-up hearing over $12.53m debt

The debt crisis engulfing the Derrimut 24:7 Gym fitness chain has reached a new low as instructors reveal they have not been paid in more than a month.

Instructors at Derrimut 24:7 Gym have not been paid for a month as the ATO seeks to wind up a major company of the fitness chain over a $12.53m debt. Picture: NCA NewsWire / Roy VanDerVegt

At least 15 instructors at Derrimut 24:7 Gym have not been paid for a month as the ATO seeks to wind up a major company of the fitness chain over a $12.53m debt.

A Federal Court wind-up hearing is set for Friday after a hearing last month was adjourned to give the company more time to reach an agreement with the tax office.

In an email to Adelaide instructors who are owed thousands of dollars in wages, Derrimut 24:7 Gym wrote earlier this week it was “securing short term finance as part of a debt restructure”.

“We understand today was the anticipated payment day... unfortunately this has not occurred,” the email said.

Derrimut 24:7 Gym founder and owner Nikolaos Solomos in an Instagram video speaking about the ATO tax debt and Angle Vale store closure.

“While the process will begin tomorrow, we cannot confirm exact payment dates beyond that.”

One of the unpaid instructors, speaking to The Advertiser on the condition of anonymity, said their weekly payments had been delayed for at least two months.

“They’re still taking money from members but they’re not paying us – there’s been no clear communication,” they said.

“I’m pissed off. I’m really frustrated.”

The fitness chain has continued to promote special deals for customers while instructors have gone unpaid ahead of the wind-up hearing, advertising memberships for $9.95 a week on its Instagram on Saturday.

Derrimut 24:7 Angle Vale being cleared out after it abruptly closed on Wednesday afternoon. Picture: Darren Chaitman.

The email to staff said Derrimut was “committed” to bringing payments up to date within the next two to four weeks. Picture: Darren Chaitman ,

The email to staff said Derrimut was “committed” to bringing payments up to date within the next two to four weeks.

“We know this situation has gone on far too long and we acknowledge the frustration and impact it has caused.”

A second instructor said to be “led on for weeks and weeks with promises of payment of services already delivered is just appalling”.

“Derrimut is threatening the livelihood of people and that is unacceptable,” they said.

Bench Fitness and energy company AGL has joined a list of creditors supporting the wind-up action, after gym-goers recently reported what appeared to be temporary power outages or dim lighting at Adelaide branches.

Return to Work SA, Melbourne United Basketball and Fitness Equipment Pty Ltd are also supporting the ATO’s order.

Court documents obtained by The Advertiser said the company’s $12.53m debt as of June had been reduced from an initial $15m owed to the ATO in April.

Derrimut 24:7 Angle Vale being cleared out after it abruptly closed in July. Picture: Darren Chaitman

In July, customers were kicked out of the chain’s Angle Vale branch mid-workout before it closed because of about $220,000 in rent owed to the landlord.

The next month a notice was posted on the doors of the yet-to-be-opened Munno Para branch, saying the tenancy had been terminated because of more than $54,000 owed to the landlord.

Another branch in Shepparton, Victoria, closed recently.

The chain said on its Instagram last month it was “not going anywhere” and was “committed to continually moving forward”.

Derrimut 24:7 Gym has been contacted for comment.

Originally published as More than 15 Derrimut 24:7 Gym instructors left unpaid in lead-up to ATO wind-up hearing over $12.53m debt