David Collard’s Scale Facilitation’s workers seek action over months of unpaid wages
At least four law enforcement agencies have been contacted by staff who have not been paid for months by an embattled Geelong start-up entrepreneur.
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At least four law enforcement agencies across two countries have been contacted by staff who have not been paid for months by an Australian entrepreneur’s flailing start-up empire.
Insiders at David Collard’s Scale Facilitation have also raised the alarm about the company’s pursuit of generous tax incentives for research and development, with questions to the Australian Taxation Office prompting a stern warning to the public about abusing the scheme.
As frustrated staff continue to walk out in Geelong, New York and London, complaining to authorities and plotting legal action over unpaid wages, Mr Collard has been hunting for cash to rescue a deal to take over a British battery manufacturer.
But the former PwC partner this week moved out of his luxury apartment on Manhattan’s Billionaires’ Row after his landlord launched legal action alleging he missed several $US75,000 (A$115,638) monthly rental payments.
In Victoria, most of Mr Collard’s employees across his cash-strapped firms – including Scale, Recharge Industries and SaniteX Global – have not been paid since May.
Staff have complained to the Fair Work Ombudsman and Wage Inspectorate Victoria – which enforces Australian-first wage theft laws – while also contacting the tax office over unpaid superannuation.
In New York, the Department of Labor confirmed it received a complaint about payment issues believed to date back to April.
A source said Australian staff in the US had been left in limbo because they moved to New York on visas tied to their jobs and had no income. Some have since returned home.
Another source said employees were “losing hope” that they would receive what they were owed, having been previously told their money was tied up in India and that overseas transfer disruptions had affected the payroll system.
“It’s gaslighting – you start to feel like you’re the crazy one,” an ex-staff member said.
The law enforcement agencies said they could not comment on any active investigations, while Scale did not respond to questions, having previously promised to fix missed payments.
Mr Collard hit the headlines in June when the Australian Federal Police raided Scale’s Geelong offices as part of a tax fraud probe. The company has denied any wrongdoing and no charges have been laid.
Insiders have now questioned its focus on lucrative research and development tax breaks, with marketing documents showing the company touted a “model” to take advantage of them through a fund it promised was “attractive to US investors”.
Scale boasted it could secure rulings from the Department of Industry, Science and Resources allowing it to claim overseas R&D spending towards Australian tax refunds.
The firm has set up at least 50 R&D vehicles, corporate records show.
The ATO, which shares responsibility for the incentive scheme with the department, said it could not comment on Scale “due to our obligations of confidentiality under the law”.
However, speaking generally, a spokesman said the ATO was “extremely alert to schemes which seek to abuse the R&D tax incentive”.
“The ATO will take the strongest action when people seek to abuse the R&D tax incentive, particularly where there is fake expenditure or no real R&D activities being undertaken,” he said.
Scale did not answer questions about R&D incentives. It is not suggested the firm did not comply with the relevant legislation.
A spokesman for the department said it regularly conducted compliance activities but could not comment because it was “bound by strict confidentiality obligations under the law and commenting on specific trends or types of claims made may risk identification of a company or companies, or prejudice the department’s integrity activities”.
Mr Collard last year invited Richard Marles and Peter Dutton to Scale’s office opening on the 82nd floor of New York’s One World Trade Center, where the Deputy Prime Minister praised him as a “force of nature” and the Opposition Leader called him “Superman”.
Scale was later hit with a lawsuit for allegedly failing to pay for subleasing office space on the 88th floor, although the case was dropped this month. The leaseholder and its lawyers declined to comment.
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