‘Feel cheated’: Aussie company under fire
An Australian company is being slammed as struggles emerge over unpaid wages, customers are left in the lurch and others “feel cheated”.
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The crisis engulfing an Australian childcare chain appears to be spreading, with another centre abruptly closed as staff from numerous sites chase unpaid wages, while a company that supplied casual educators revealed it’s owed a staggering amount.
News.com.au broke the news that the Genius Early Learning Childcare’s centre based in Pyrmont in inner Sydney was hit with mass resignations and a staff walkout forcing the closure of the centre last week.
There appear to be 13 centres that have now been closed across Australia including in Victoria, NSW, the ACT and South Australia, often abruptly, with little or no notice for parents.
The latest Genius centre to shut down hastily is a Perth centre located in the southwest suburb of Hamilton Hill.
Parents received a message on March 4 that the centre was going to be closed on that day due to staffing issues but since then it has not reopened.
Instead, on Sunday, March 9, they were told the Hamilton Hill centre would be closed until “further notice” due to “unexpected staffing challenges”.
Sophie* had her three-year-old son in the centre and told news.com.au she was left scrambling to find care for him. She said parents have been given little detail on why the centre has been forced to close.
“I feel like they should be more transparent about what is going on,” she said.
“Maybe teachers haven’t been paid and are not going to come back, which is fair. I don’t blame them.”
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The 37-year-old said she only uncovered the troubles plaguing the company after she read media reports about educators being out of pocket for wages and superannuation.
“I feel sorry for them and my son didn’t even get to say goodbye to them,” she said.
News.com.au also understands that the Genius centre in Artarmon has also been shut down since February 28 with parents told the closure would be extended until 18 March due to “unforeseen staffing challenges”.
But it’s not just parents and educators that have been hit hard.
A mum and dad business, who had provided casual educators to Genius childcare centres around Canberra, haven’t been paid the $42,000 owed to them, despite chasing for weeks and mostly being met with “radio silence”.
Ranjan, who did not want his surname used, is the co-founder of a recruitment company, and had signed a contract with Genius in November to supply casual educators. But only one invoice has ever been paid.
“That’s a pretty decent chunk of our profit and more than that is the time and effort you put in you are not going to get back,” he told news.com.au.
“We were providing them six or seven educators a day so without our services they couldn’t have kept their centres open.”
Do you have a story? Contact sarah.sharples@news.com.au
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Finally, in mid February he refused to send any more casuals to Genius centres until the invoices were paid.
He had previously raised concerns when issues with their Canberra centres were aired in December.
“I feel cheated and a bit dumb as well to be honest,” he said.
“We had heard news of Genius being in trouble and we spoke with them and were assured we don’t have to worry as it’s momentarily caused by issues and we will resolve them and invoices won’t get struck and will get paid. We trusted them.”
Ranjan added the recruitment company had been around since 2018 and they had never had this issue with other childcare operators.
News.com.au has reached out to Genius Early Learning for comment.
Erin* is another parent that has been hit by Genius permanently closing its centre in Castle Hill in Sydney.
Parents were told via email at the end of February that the centre would be shut down on March 12 due to “ongoing staffing challenges and the lasting impact of Covid-19 on the early childhood education centre”.
But the centre was abruptly shuttered on March 4 without warning – nine days before it was due to close – leaving Erin with no care for her children, aged two and four. They were due to start at a new centre after the closure.
Erin said rumours had been flying among the parents that educators were owed outstanding wages and many had already been looking for alternative centres.
But she said it was stressful to be caught without care as the same message was “copied and pasted” over three days about staffing challenges meaning the centre couldn’t open.
“It was just a bit of a smack in the face. We had already been through all the uncertainty and stress around it closing … Finding out they were actually just closed suddenly, basically with no notice, it was really stressful,” she said.
“It’s been very hectic and we are still chasing up a refund for the last two days as you have to pay in advance and we are not sure if we are going to see that refund.”
Erin said she had observed the use of more casuals in recent months and her husband had also seen a debt collector chasing rent at the centre.
She believes it is “horrendous” that staff were not paid when wages were due.
“It’s beyond ridiculous. I was just gobsmacked. You don’t treat people that way and don’t want to send children to where staff aren’t treated properly – they look after our children,” she added.
Meanwhile, Jessica* is a 10-year veteran of the childcare industry who worked at Genius’ Melbourne centre in Taylor Lake. She said the staff forced a one-day closure in January and were then paid. But this time has been different.
She is in a dire financial situation as she is owed weeks of pay adding up to nearly $4000.
The centre was also abruptly closed on February 27 after educators walked out and she estimates 15 to 20 staff members are owed four weeks of wages.
But she said educators have been left in limbo as to what is happening as their desperate emails and texts are mostly ignored, while she never even got a reply to her resignation letter.
“I’m really struggling, I’ve just been pretty much paying rent and food and having to sell things to come up with the rent money,” she said.
“I’ve also resigned but I had to give five weeks notice to make sure that I get my 200 hours in annual leave paid.”
She said the situation is “absolutely terrible” and it feels like “they have been taken advantage of”.
“It’s absolutely shocking what’s happened,” she said. “I know people are trying to help but I feel like we are going nowhere.”
Jessica said it feels like there is no protections for childcare workers that don’t get paid, despite strict regulations surrounding the provision of care for kids.
Educators had been forced to launch a GoFundMe campaign to try and cover costs, with the Melbourne woman saying it had helped her buy food.
Trouble has been brewing at the national childcare chain, which has 27 sites across Australia, for months. Educators from other centres have also refused to work or resigned en masse due to delayed payments of wages and super.
In NSW, Genius chain’s centres in Castle Hill, Dural, Lane Cove and Wynyard have all closed. Emails show the Dural centre trying to rehome its pet rabbit.
Other Australian sites to shut down include Toowoomba in southeast Queensland and a centre in the suburb of Granville, Blair Athol in Adelaide, Symonston in the ACT as well as Ashwood and Beaumaris in Melbourne.
News.com.au understands some staff have been now been paid part of their wages at the Pyrmont centre.
Genius, which now operates under the name of Abacus 49 Pty Ltd, had acquired 31 underperforming centres from childcare provider giant G8. In an unusual deal, G8 paid Genius over $25 million last year for the acquisition, the Australian Financial Review revealed.
The United Workers Union is suing Genius over an alleged unpaid superannuation bill which adds up to $7 million, launching action in court in December.
The “slow-motion collapse” of Genius Early Learning has been “traumatic” for parents, children and workers, said United Workers Union national president Jo Schofield.
“The full impact of a collapse will hit hard, with consequences for families and workers at about 27 centres across all mainland states and the ACT,” Ms Schofield said.
She said staff and parents have been subjected to the “cowboy behaviour” Genius for more than a year.
“We first wrote to Genius about late pay and unpaid superannuation in May last year, with unpaid superannuation dating back to November 2023,” she revealed.
“Educators struggling to do their best for kids have seen their rent payments bounce, credit scores go through the floor and some educators have relied on food parcels to put food on the table for their own kids.
“Sadly now with a spate of recent closures it looks likely our members will have to deal with the uncertainty of administration or liquidation, including possibly battling for what they are owed from the Fair Entitlements Guarantee Fund.”
However, Ms Schofield said unpaid super was not repaid via the government scheme so some employees will be “deeply out of pocket”.
“More broadly the behaviour of Genius has unpleasant overtones of the collapse of ABC Learning, and once again raises the question of for-profit companies in the provision of essential early education and care,” she noted.
“It’s not fair that a for-profit operator has relied on the goodwill of workers to keep its doors open.
“This likely collapse adds to the case for universal access to publicly-provided high-quality early childhood education and care.”
A Department of Education spokesperson said it was aware of the allegations made about Genius Childcare and reports of employees not receiving their entitlements.
“We acknowledge the stress that this situation has caused for many, including families accessing early childhood education and care (ECEC) and importantly for ECEC educators,” they added.
*Names have been changed
sarah.sharples@news.com.au
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