Encompass Community Services’ 2.7ha Leopold farm sold to Give Where You Live foundation for $1.85m

The Leopold farm once operated by Encompass has sold and the quest for back pay of former employees has taken another turn.

Encompass Community Services' former office at East Geelong. Inset: Former Encompass chief executive Elaine Robb, top, and former board chair Alyson Miller.

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Money available to pay former employees of collapsed community service organisation Encompass has been boosted by $1.42m.

Encompass Community Services’ 2.7ha farm at Leopold, where day programs for people with disabilities were operated, was sold to the Give Where You Live foundation for $1.85m in recent weeks.

Less costs of the sale and mortgage repayments, $1.42m will be available to put onto Encompass’ books.

The underpayment of about 450 Encompass employees between October 10, 2015 to October 10, 2021 was the subject of audits when solvency and forensic accounting firm Worrells took over Encompass in January.

The latest report from Worrells, now Encompass’ liquidator, to creditors shows more than $3.1m is owed to staff including $1.19m in wages and superannuation, $782,000 in leave entitlements and $1.19m in retrenchment payouts.

Former Encompass chief executive Elaine Robb, who worked at the organisation for more than 27 years, claims Encompass owes her $185,146, according to a creditors list seen by the Geelong Advertiser.

Her claim is the largest made by any former Encompass employee outlined in the April creditors report.

Worrells has set the price of, what it says, is a complex administration and liquidation of Encompass at almost $1.1m. It wants to be paid more than $316,500 for liquidation work between February 17 and April 26.

Worrells liquidator Nathan Deppeler said based on current data of what is owed to former employees the majority of the amount could be paid from funds recouped from debts owed to Encompass, and from the federal government’s Fair Entitlements Guarantee.

Liquidator Nathan Deppeler from Worrells

Liquidator Scott Andersen from Worrells

“We consider that based on the anticipated recoveries from asset realisations and or recovery actions known at this juncture, as well as the support provided by the Fair Entitlements Guarantee scheme, there should be sufficient recoveries to pay the majority, if not all, of the outstanding employee entitlements owing to individual employees,” Mr Deppeler wrote in a creditors report.

Worrells will apply to the Federal Court for it to determine if it was lawful for Encompass to offset Jobseeker payments staff received during the pandemic against amounts owed due to underpayment.

Worrells will also ask the court to rule if it must complete a pay audit of about 350 staff who worked at Encompass between October 10, 2015 to October 10, 2021.

“It is unclear whether there is an obligation on the liquidators to conduct an audit for former employees given the substantial cost, complexities and difficulties of completing such an audit or whether it remains the sole responsibility of the respective former employees to prove their

debt in respect to any claim they wish to make,” Mr Deppeler wrote in the report.

“Our investigations into this matter are continuing and we will provide creditors with an update in a future report.

“Whilst there are sufficient funds available in the Liquidation for us to conduct detailed further investigations, this will erode the return available for creditors in the form of a dividend.”

Originally published as Encompass Community Services’ 2.7ha Leopold farm sold to Give Where You Live foundation for $1.85m