The founder and owner of the job service provider ORS Group featured in Monday’s Four Corners is a former public servant, Peter Scott, who lives in a modest house in Gwelup, in Perth’s bland northern suburbs.
Despite his low profile, over the past two financial years Scott has been paid $3 million in dividends by ORS, which he wholly owns through another private company, Panoply.
The Four Corners program aired allegations ORS had routinely faked client signatures in order to receive government subsidies for training and job-placement services.
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Scott founded Occupational Rehabilitation Solutions (ORS) in 1992, after spending a decade at WorkCover WA as a rehabilitation manager.
In 2013-14 ORS, which has more than 600 staff working at more than 60 offices around the country, doubled its after-tax profits to $3 million, of which $2 million were paid as a fully franked dividend to sole shareholder Panoply. Panoply is wholly owned by Scott after he bought out former ORS co-owner Stuart Reidy-Crofts, who resigned as a director in 2011 and set up another job-services business, Pace National.
Accounts filed with the corporate regulator show ORS reported a 30% jump in revenue to $66 million last year, largely as a result of increased disability employment service work for the federal government agency Job Services Australia.
Scott’s LinkedIn page shows he has been a registered psychologist since 1987 (according to the official Australian Health Practitioner Regulation Agency website) and studied at Michigan State University.
Among his other interests, he is shareholder, director and secretary of Judgment Index Australia, which licenses an American workforce management tool used by ORS — not an IQ or personality test, according to this short promotional video on YouTube, but a way of identifying good judgement and decision-making ability among workers, or “the right person for the right seat on the bus”.
Whatever his wealth, Scott has not splashed out on expensive Perth property: in 1993, he and wife Robyn paid $175,000 for the four-bedroom home on more than 700 square metres of land in Gwelup, and in 2010 his wife, Robyn, paid $765,000 for the same-size, same-vintage house next door.
Scott did not return Crikey’s call this week. Four Corners’ Facebook page received a stream of posts in the wake of the program, including Dean Butterfield, who wrote “just saw the story …I was with ORS job network and some of the same things happened to me”.
Former workers in the job services industry also commented, with a user called Max van der Kwast writing:
“Government should NEVER have outsourced the provision of assisting the most vulnerable members of society to vultures, i.e private business! I know this for a fact — I work for a JSP. It’s just wrong!”
A user called Peggy Pug wrote:
“Thanks for exposing the fraud in Job Network. I was employed in the industry and was bullied by managers for years into claiming thousands of dollars in dodgy fees. Claiming thousands for Job Search Training that didn’t exist. Coercing people into signing forms saying they were ‘depressed’ to get them made highly disadvantaged ‘eg high fees’ paying 100 percent wages to employers to get them off the dole for 13 weeks. Some of these employers went through 15 staff in a row, they all loose [sic] their jobs after 13 weeks. It’s a dodgy dodgy network and the senior management are crooks. Thank god I got out with my sanity intact”
ORS was not the only organisation featured on the Four Corners program, which also featured allegations of training rorts by MAX Employment, owned by US-listed giant Maximus. As Bronte Capital hedge fund manager John Hempton wrote this week, Maximus has had a stellar run on the sharemarket lately, courtesy partly of rising revenues from Australia, which is its second-largest market. MAX gave this statement to Four Corners.
It is not clear what action, if any, the federal government has taken in response to the allegations aired on Monday. In a statement, federal assistant Employment Minister Luke Hartsuyker told Four Corners the government reforms to stop churning of the unemployed and “training for training’s sake” would be introduced from July 1.
An employment department spokeswoman told Crikey: “The department does not comment on the specifics of any particular investigation it undertakes, as to do so may prejudice the investigation. I can confirm though departmental officials visited several of the ORS offices in mid -2014.”