Fresh blows to Scientology in Australia

Scientology in Australia, which is already fighting to retain its tax-exempt charitable status, faces new threats to its financial survival.

Australia’s Fair Work Ombudsman issued a damning report on the movement’s employment practices Friday – the same day a leading law firm announced plans for a possible class action lawsuit against the movement.

In its report, the FWO rejected Scientology’s claims that it was not subject to the country’s employment laws because of its religious status.[1]

It did not announce immediate legal action against Scientology, as media reports ahead of the release of its findings had suggested might happen.

But it made it clear it would continue to investigate and, if need be, sue the movement.

Australia law firm Slater & Gordon meanwhile announced it was considering a class action lawsuit against the movement over claims it had underpaid its workers for years.

Having conducted its own year-long investigation, it invited former members to come forward – and the key finding in the FWO report suggests that it will have a solid legal foundation on which to build.

The agency said it had “considered, but was not persuaded by” Scientology’s argument that its religious status exempted it from the Fair Work Act.

Scientology’s own documents and policies “plainly contradicted” this, it said.

The movement had characterised the small amounts paid to its workers as expenses to cover the costs such as travel and child care, rather than wages.

But this did not tally with the actual arrangements, the report found.

“In particular, witness evidence indicates that significant hours of work were imposed on workers,” it said.

“Further evidence indicates a significant level of control and direction was applied to workers by more senior church members who held positions of authority,” it added.

The movement’s own documents indicated it was a “bureaucratised organisation”, which appeared to have imported its system wholesale into Australia with little thought to the country’s laws.

“Systemic problems”

The complaints it had investigated – and the fact that it had received further complaints – suggested “systemic problems” inside the movement, the agency added.

But it also advised anyone working for any religious organisation for free that they should protect their own interests and “withdraw their labour if they perceive that their relationship ceases to be truly voluntary.

“In many instances, the witnesses provided considerable free labour to the CoS over a period of several years where they either knew or ought to have known that they were unlikely to be paid for that work from an early stage.”

While some witnesses had alleged the use of “unconscionable tactics” by the movement, the agency made no findings in this area. Instead, it advised anyone who felt they had been intimidated or pressured to provide labour to contact the police.

Similarly, any allegations against the movement that fell outside its remit would be passed on to the relevant agencies, it added.

The agency made it clear that it would investigate future complaints against the movement “on their merits”. It was holding its other powers – including the possibility of litigation – in reserve, it said.

But it would not pursue allegations brought by several witnesses: in some cases because the time limit for civil penalties had passed; and in some because there was insufficient evidence.

It would however look further into allegations by one witness concerning the Get Off Drugs Naturally programme.[2]

The report admonished the movement for having failed to identify problems earlier.

"At the very least, the volume of complaints should alert the CoS that there needs to be a change to the current practices relating to how they recruited and are receiving free labour from their followers, should they hope to reduce the number of complaints into the future,” it argued.

“Witnesses told the Fair Work Ombudsman they were directed to work up to 72 hours without a break to complete tasks assigned to them for as little as $10 a week at a time when the Federal Minimum Wage for a full-time adult before shift and weekend penalties was $543.78 for a 38-hour week,” said a statement from the agency.[3]

The agency advised the movement to conduct an audit of its activities – using a consultant approved by the agency – to review its employment practices.

Class action

Also Friday, private law firm Slater & Gordon announced it was looking at launching a class action against Scientology over its alleged underpayment of workers.

In a statement, practice group leader Steven Lewis said the firm had been investigating the movement for the last year, having received complaints from several former members.[4]

“We have come to the view that former Scientology members were in fact employees and there has been a policy not to pay them proper wages and entitlements,” Lewis said.

“This could mean they are entitled to back pay, superannuation contributions, holiday pay and overtime.

“We are now at the point where we are calling on former members who worked with the organisation since 2005 to contact us on a confidential basis to discuss possible claims against the organisation.”

He could not estimate the size of such a claim, or the number of claimants, Lewis said.

But he added: “What we have been told by former members is that for years the organisation exploited many of its workers by calling them volunteers despite being required to perform a range of work for little or no pay.

“Scientology is no different to any other employer in this country, it is obliged to pay wages and other entitlements under the law and the relevant award.

“This isn’t about attacking beliefs, it is about being paid a fair wage for a fair day’s work,” he added.

A perfect storm

Scientology in Australia now appears to face challenges in both the courts and parliament.

It already risks losing its charitable status – and the tax breaks that go with it – following a campaign by independent senator Nick Xenophon on behalf of former members.

The government now seems minded to adopt his proposal that charities receiving tax relief should meet a public benefit test – something that could prove problematic for Scientology, given the numerous allegations of abuse it faces.

A forthcoming court case also threatens to bring Scientology more unwelcome publicity. One of its most senior officers, Jan Eastgate, faces trial on a charge of perverting the course of justice, for having allegedly covered up child abuse inside the movement.

Add to this the announcement from the Fair Work Ombudsman and the threat of a class action lawsuit and Scientology appears to be facing a perfect storm that could to ruin it financially in Australia.[5]

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[1] “Statement of Findings in relation to the Fair Work Ombudsman’s investigation of entities related to the Church of Scientology, Narconon and Get Off Drugs Naturally”

[2] Get Off Drugs Naturally is part of the controversial Narconon network of drug rehabilitation centres that use Hubbard’s controversial detoxification method. The FWO report notes that Scientology claims it has no legal connection with either FWO or Narconon.

[3] Statement from its website, September 16: “Fair Work Ombudsman releases findings of investigation into Church of Scientology”

[4] Statement on their website, September 16: “Slater & Gordon investigates class action over Scientology wages claims”

[5] The Fair Work Ombudsman’s investigation arose out of an investigation into Scientology by ABC television’s Four Corners documentary programme broadcast on March 8, 2010: “Scientology: the Ex-Files”, presented by Quentin McDermott. Senator Nick Xenophon who had launched his campaign against Scientology abuses the previous year, followed up on that report on March 18 when he tried and failed to get a Senate inquiry into Scientology’s alleged exploitation and abuse of its members. In his speech to the Senate, he made a series of allegations about Scientology’s employment practices. The Fair Work Ombudsman’s office was subsequently put in touch with former members who had complained about Scientology.