Nationwide crackdown on charities using middlemen to hire ‘charity chuggers’

EXCLUSIVE:They’re notorious for bailing you up on the street with a cheesy introduction and sweaty handshake. But the day of the annoying charity collector, or ‘chugger’, could soon be over.

Workplace watchdog will today announce its first inquiry into how charities outsource fundraising. Picture: Mike Keating.

They’re notorious for bailing up pedestrians and shoppers to beg donations for famous charities.

But charities face a nationwide crackdown on their use of middlemen who hire “charity muggers”, or “chuggers”, as well as door-to-door fundraisers, and call centre operations.

The workplace watchdog will today announce its first inquiry into how charities outsource fundraising.

The inquiry comes after unions accused charities of turning a blind eye to sharp practice in the fundraising industry. Picture: Annette Dew

The investigation will consider stricter punishments to address “lax governance arrangements” in charities that allow for-profit middlemen to rort the system through sham contracting, tax avoidance and worker exploitation.

It comes after unions accused charities of turning a blind eye to sharp practice in the fundraising industry.

One middleman fundraiser investigated by the Ombudsman for underpayment earlier this year raised funds for The Wilderness Society, OXFAM Australia, UNICEF, RSPCA, Starlight Children’s Foundation of Australia and the Cancer Council.

The Ombudsman concluded its investigation into North Sydney-based Mondial Fundraising Communications, ordering it to back-pay $770,000 to 824 current and former employees who were “unintentionally” underpaid since 2010.

RSPCA was one of the organisations that had money raised by a middleman who was investigated.

It’s understood Mondial has so far back-paid workers more than $300,000 after the National Union of Workers raised concerns over the company.

Mondial has also agreed also apologise to the underpaid workers and donate $10,000 to the Marrickville Legal Centre, pledging to rectify all underpayments by the end of 2017.

The Fair Work Ombudsman is also prosecuting Australian Sales and Promotions, a for-profit fundraising company which allegedly underpaid a 26-year-old British backpacker almost $8000 and insisted he apply for an ABN in a bid to avoid workplace laws.

Many charities were horrified to find out their workers were being exploited.

Acting Fair Work Ombudmsan Michael Campbell said everyone involved in charitable fundraising had a “ social, moral and corporate responsibility to ensure compliance with workplace laws.”

“Many charities have no idea whether the workers who are wearing hats and T-shirts bearing their logos and collecting donations on their behalf are being paid correctly or treated fairly,” he said.

He added that many charities had been “horrified” to discover workers were being exploited.

The Ombudsman will scrutinise 15 charities chosen “at random” that have incomes ranging from below $250,000 to more than $1 million, as part of the Inquiry.

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