Job providers are being paid millions of dollars in public money for work that jobseekers are finding themselves, with advocates saying there is “simply no reason” for the payments.
The Department of Employment and Workplace Relations has paid providers more than $3.6m in the past five years for pre-existing employment, where someone on jobseeker found a job prior to starting with a provider, according to data provided to Guardian Australia by the department.
The data shows there has been an uptick in pre-existing employment payments, with providers receiving $1.1m in the 2023-2024 financial year, more than double the $464,200 paid in 2019-2020.
Service providers are allowed to claim outcome payments when clients have completed four, 12 and 26 weeks in employment, regardless of whether the client or provider found the job. Jobseekers signed on to mutual obligations must complete a range of tasks each month – such as job applications, education or training with employment service providers – to continue to receive their welfare payments.
Welfare advocates argue there is “no reason” for providers to get paid for jobs they do not help people find.
Neither the minister for the Department of Employment and Workplace Relations, Tony Burke, nor the National Employment Services Association, the peak body for job providers, would answer questions from Guardian Australia.
Providers also receive public funding for outcome payments when a jobseeker has found work after signing up with a service. In the 2022-2023 financial year, providers were paid $329.07m for all outcome payments.
Sydney-based Nathan – who asked not to use his full name – used the atWork employment services provider last year for nine months. After he found a job himself as an assistant manager, he let atWork know that he wouldn’t need them as he didn’t need Centrelink moving forward.
Nathan said atWork asked him for pay dates, his salary, weekly hours and manager’s name.
“Centrelink themselves told me it was because they [employment services providers] get bonuses for getting the job for someone,” he said. “When I said I wouldn’t give that information, they put a strike through me, which negated me from getting my final payment.”
Nathan was relying on the final payment before starting work. He says his job provider said he missed three appointments in a week – but Nathan claims he didn’t miss any.
“These appointments, they said, were over the phone and there were no calls, there were no appointments. I didn’t miss any. And three in a week doesn’t make sense.”
Another jobseeker, Jessica, who also asked not to use her full name, said she found a part-time role for herself. But two months into her role, her boss asked her if she knew someone from the job provider APM.
The 22-year-old said she hadn’t told APM she had been hired, leading her to believe APM called every company she said she had applied to work with.
“Then they [APM] sent me a message saying ‘we know you’re working [there], you need to come and fill out some forms’.”
Jessica receives a small amount of Centrelink each fortnight to supplement her income. She said at her next appointment with APM, she was asked to sign paperwork backdated to before she started the job, saying APM had helped her find the job.
“I’m trying to get more hours which is more likely at work so that’s good. But as far as the employment agencies go, they don’t help.”
AtWork has been contacted for comment. APM said it cannot comment on specific cases.
Speaking generally, Jeremy Poxon, an officer at the Australian Unemployed Workers Union, said the union regularly hears from participants who are “harassed for their payslip information by providers who need to enter those details into the system to receive their outcome payments”.
“There is simply no reason why the government should give providers outcome payments for jobs that participants have found themselves prior to even meeting with them,” Poxon said.
“Participants tell us that providers make it more difficult to keep their pre-existing employment due to the constant barrage of mutual obligation activities, threats and penalties.
“This is a significant failure from the Labor government to stand up for the rights of some of the most disadvantaged workers in the labour market.”
A spokesperson for the Department of Employment and Workplace Relations said there must be a significant “increase in the client’s earnings/hours, that occurs while being supported by the provider, in order for an Employment Outcome to be paid”.
“It is inappropriate for any Workforce Australia Services provider to harass, bully or threaten clients into handing over information about their employment,” the spokesperson said.
“The Australian Government is considering employment services settings as part of the recommendations of the Select Committee Inquiry into Workforce Australia Employment Services.”
