Clive Palmer leaves the Supreme Court in Brisbane earlier this month. Picture: AAP Image/Darren England
Clive Palmer leaves the Supreme Court in Brisbane earlier this month. Picture: AAP Image/Darren England

What we pay when companies go bust

TAXPAYERS have forked out more than $1 billion for collapsed companies which failed to properly pay their workers and left the Commonwealth to pick up the tab.

Despite the massive payout over the past five years, less than $200 million of that has been recovered through the courts.

Businessman Clive Palmer's company Queensland Nickel is still responsible for the biggest payout under this scheme, $66.8 million - more than double the next biggest culprit.

Under the Fair Entitlement Guarantee, the Commonwealth covers unpaid entitlements of workers when a company goes into liquidation.

It seeks to recover the cash through liquidators, such as with Queensland Nickel which remains before the courts facing civil action.

The Courier-Mail can reveal that $1.138 billion has been paid out in 7798 cases since 2013-14.

But over this time just $190 million has been recovered through court action.

Liquidators acting for the Federal Government are chasing $66.8 million paid out to 759 Queensland Nickel workers after the company fell into liquidation in April 2016.

The next biggest payout under the FEG or its predecessor scheme was $32.99 million paid out in 2012-13 to employees of the Hastie Group, made up of 19 entities.

Queensland Nickel's payout was almost four times the size as the second largest payout for an individual company, which was $17.3 million to CMI Industrial Pty Ltd in 2011-12.

Employment Minister Kelly O'Dwyer introduced legislation last week which significantly increases penalties for companies and company directors who deliberately or recklessly dud their workers.

It would also potentially force unpaid wages to be covered by related businesses entities.

"Employers must pay the entitlements their workers are due. Those employers that do the wrong thing will face the full force of the law," she said.

The Courier-Mail attempted to contact Mr Palmer, but a spokesman said he was overseas.

Mr Palmer has previously said Queensland Nickel's administrator had refused to transfer staff to his other companies and "refused to allow us to fund the business".

He has said QN was entitled to be treated like all other Australian companies.

Under the proposed laws individuals convicted of criminal offences of deliberately or recklessly avoiding paying entitlements would face a maximum 10 years jail and a fine of up to $945,000, while a company could by fined $9.45 million.