Sale of Encompass farm, federal scheme to pay staff entitlements

Staff caught up in the collapse of Encompass are owed more than $3m. The organisation’s administrator has revealed how that could be paid.

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

Selling the assets of collapsed community service provider Encompass and payments from a federal government scheme would cover “most, if not all” of the $3m owed to employees, the organisation’s administrator says.

Administrator Worrells was coy on details of a potential sale of Encompass’ 2.7ha farm at Leopold after it revealed a “community organisation” had made an offer to buy the O’Halloran Rd site.

“The party has advised they are looking to expand access to The Paddock for a range of community members including existing clients and families while also operating it as a social enterprise,” Worrells said in a statement.

“We anticipate rapidly progressing with the Paddock offer and are hopeful that the site will again be available in the short term, which would be a great outcome for all stakeholders.”

A Geelong real estate source said the property could be worth more than $2.1m.

Payments to employees could come after the cost of administration, likely to be more than $670,000, is paid to Worrells which took over Encompass last month.

Worrells, which will need approval from creditors to be paid its fee, said Encompass’ affairs were “highly complex, high volume and constantly evolving” due to the organisation’s various divisions which each needed separate assessment, and the number of its employees and program participants.

Administrator Scott Andersen from Worrells

Administrator Nathan Deppeler from Worrells

At a meeting on February 17, Worrells will ask Encompass creditors to put the organisation into liquidation.

The move would allow former employees to lodge claims with the federal government’s Fair Entitlements Guarantee that would see some of their entitlements paid, Worrells said.

Between 1985 and its shutdown on February 5, Encompass provided disability employment services. It also provided recreation and travel support, in-home care and accommodation to people with disabilities.

According to Worrells, in January Encompass served about 900 participants, was training about 110 students and had 298 employees.

Worrells is investigating if Encompass was trading insolvent before its collapse.

Investigations indicate Encompass “may have been trading insolvent since at least 30 June 2022”.

If Encompass is found to have traded insolvent, civil action could be taken against its directors and contracts it entered into could be cancelled.

Encompass’ directors are Alyson Miller, Amanda Wilkens, Grace Brown, Gloria Jellef and Daniel Kovacev, according to Worrells.

Worrells’ report to Encompass creditors noted claims relating to misappropriation of funds, wage underpayment and poor corporate governance could be extended to Encompass chief executive Elaine Robb and other senior management but further investigation was needed.

“(Elaine Robb) had taken a leave of absence from December 2022 and was still on personal leave as at the date of our appointment,” Worrells said in its report to creditors.

Originally published as Sale of Encompass farm, federal scheme to pay staff entitlements