Billionaire publican Arthur Laundy and his former business partner have been hit with claims that staff at their venues were underpaid by hundreds of thousands of dollars, as the business mogul prepares to finalise his $56 million takeover of Nine’s radio network.
Leaked documents show hundreds of staff at venues owned by Laundy and Fraser Short under The Sydney Collective group had their pay audited in 2023, with some staff members allegedly owed as much as $30,000 each.
But three years on, staff from high-profile venues including the Watsons Bay Hotel, Northies Cronulla and The Mona Vale Hotel say they have not seen any money from the companies.
FairWork urged any workers with concerns to contact them directly for assistance. Laundy Hotels said if any former employees claim they are underpaid, then it will “undertake a full investigation and audit”.
The audit documents have reopened a feud between Laundy and Short, who have not been on speaking terms since Laundy took over the remainder of the business in a $150 million deal in 2023.
Laundy’s lawyer, Paul Svilans, said the audit was “a preliminary, qualified and therefore unreliable document”.
“In any event, it relates to a period when our client neither managed nor operated the venues,” he said. “At no stage were any of the underpayments found to be in relation to any period for when Laundy Hotels took over the operation and management of The Sydney Collective venues.”
Laundy owned 50 per cent of the company for a decade before the audit was undertaken, and then assumed full ownership of the largest hotels in the group.
Laundy’s son, Stuart Laundy, praised Short when the Laundys bought out the remaining 50 per cent of his share of The Sydney Collective venues they co-owned in 2023.
“He was a very good operator and made us a hell of a lot of money,” Stuart told The Australian Financial Review.
Short said Laundy had been a co-owner of the venues since their inception.
“He bought my shares in those companies, and at the time I sold, they had settled any and all known debts. I am not currently aware of any shortfall of wages inferred,” he said. “Any enquiry should be made with the directors of the companies that still operate the businesses.”
The audit shows that 86 front-of-house staff were allegedly owed a total of $764,000 due to inconsistencies between payroll and timesheets, incorrect overtime logging and hourly rates below or above the award wage. Seventeen staff were also overpaid a total of $40,000.
“I was so burnt out. It took me a year to recover,” said Danielle Stares, a former gaming bar manager at Northies who claims she regularly had to work more than 50 hours a week.
Stares, who the audit showed was allegedly owed $11,000 because her salary was 18 per cent below the threshold of the relevant award, said that “$10,000 is like a million dollars to me”.
“It is the difference between rent and petrol,” she said. “If they can afford to buy radio stations, they can afford to pay employees back.”
From April 30, the Laundy family will own the Nine radio networks, including 2GB in Sydney, 3AW in Melbourne, 4BC in Brisbane and 6PR in Perth. The network will be rebranded as Tapt Media. Nine is the owner of this masthead.
Nine radio boss Tom Malone praised the sale to the Laundy family when it was announced in January.
“This is a great outcome for the radio business and for our people,” Malone said at the time. “The Laundy family value their staff as their most valuable asset, and we will be no different.”
Laundy, estimated to be worth $1.75 billion, said he was blindsided by the audit and claimed Short was responsible for managing the venues they had owned together.
“I paid him a management fee,” the 84-year-old said.
Laundy vowed to repay missing wages after being alerted to the audit by this masthead.
“If I owe money to people, I’ll pay people,” he said. “If you talk to any member of my staff, I reckon I back myself to say they love me.
“But you guys love the big fish. I’m the big fish. I’ve got to be caught.”
The audit lists 14 venues operating under The Sydney Collective banner throughout NSW; four of the largest, including Watsons Bay, Mona Vale, Northies and Daniel San, were co-owned by Laundy and Short until February 2023, when Laundy bought out Short’s share. Others, including the Imperial Hotel in Erskineville, The Morrison in the Sydney CBD and the Balcony Bar & Oyster Co in Byron Bay, were owned by Short independently or with other partners.
In 2024, liquidators found The Sydney Collective had debts of $5.8 million when the venues were either sold and split up, including $1 million owed to the tax office. The FairWork Ombudsman, the government regulator responsible for policing wage underpayments, is listed as a contingent creditor, with debts unknown.
The liquidators found the group was probably trading while insolvent from July 2022.
A Laundy Hotels spokesperson said the company had co-operated with a Fair Work Ombudsman investigation involving underpayments before the acquisition of the remaining 50 per cent of the hotels from Short.
“These matters were addressed at the time, and back payments were made. The FWO advised that its investigation had concluded on that basis,” the spokesperson said.
The earlier audit related to underpayments of kitchen staff. A separate group of 86 underpaid front-of-house staff is the focus of this story.
“If there are any other employees who claim that they were underpaid, we encourage them to engage directly with us, and we will undertake a full investigation and audit,” the Laundy Hotels spokesperson said.
Front-of-house workers claim they had no idea they had allegedly been underpaid until the data shown in the leaked audit was shared with them by this masthead.
At the group’s most high-profile venue, the Watsons Bay Hotel on Sydney Harbour, former manager Aline Castor said Short intervened to help with her visa, but alleges she was never paid fairly for the overtime she worked each day.
“Despite consistently giving more than what I was paid for, I was never compensated for these extra hours. When I raised the issue, I was told that ‘this was the nature of the role,’ and that I should simply accept it”, she said she was told by a venue manager.
“I gave everything to ensure excellent service, but recognition never came.”
Castor is allegedly owed $28,676 after she was paid between 2 and 9 per cent below the award threshold for her salary for three years, according to the audit.
Cendrine, a former front-of-house manager at Daniel San and Beachside Dojo, two venues owned and operated by Laundy and Short in Manly, said she would work between 12 and 18 hours a day between the venues on a $55,000-a-year contract.
Cendrine, who asked only to be identified by her first name, is allegedly owed hundreds of dollars because instances of overpayments reduced underpayments, according to the audit.
Under their contracts, managers could be asked to work “reasonable” extra hours without being paid overtime.
“I was basically going back home, having a quick nap and going back to work, starting at 8am and finishing at 2 or 3am,” she said.
Fitness tracking data from two shifts shows Cendrine walked between 37 kilometres and 43 kilometres a day while working at the venues.
“My body was broken,” she said. “I was so focused on getting my Australian residency.”
“And I remember a manager also saying to me that if I wanted to keep my job, I should be less broken.”
Another Daniel San manager, Ivan Zechel, is allegedly owed more than $26,000, according to the audit. “I believe they have a legal obligation to pay it back,” he said.
In Sydney’s north, Connor Johnson said he enjoyed working at the Mona Vale Hotel, but was shocked by the possibility that he was owed more than $10,000, according to the audit. In Johnson’s case, the documents show his salary was adjusted in 2021 while he was still at the company, to take it above the award threshold, while others who had left the group, including Stares and Castor, say they received nothing.
Genevieve Holloway, a former manager at The Morrison, owned by Short, and The Watsons Bay Hotel, owned by both Laundy and Short, is allegedly owed more than $11,000 in underpayments, according to the audit for her work at The Morrison.
“I feel like I was very, very underpaid for a very long time,” she said. “We were rostered 50 hours and expected more; it was crazy low income for 50 hours.”
Short has retreated from the hospitality industry since the Laundy sale and lives in a $9 million Vaucluse mansion.
“When I moved on as a part-owner from these and other businesses, I can assure you that all liabilities were brought up to date, including for all staff, and I paid my share,” he said. “Please leave me alone now.”
Laundy described the allegations as “hurtful”, but neither he nor Short responded in detail to the staff claims about their working conditions.
“I have just had a very straightforward and pleasant dealing with, I believe, your owners,” he said in a follow-up email referencing the Nine Radio takeover by Laundy Hotels.
Laundy owns more than 40 venues across Australia and is a major sponsor of the Canterbury Bulldogs rugby league team. He ran his first pub as a 21-year-old – the Crossroads Hotel in Liverpool – then took over the rest of the Laundy empire from his father.
His sons, Stuart, a former Bachelorette contestant, Craig, a former federal Liberal MP, and his daughter, Danielle, as well as four of his grandchildren, all work in the family business.
“The money isn’t worth anything to me,” Laundy told Mark Bouris’ podcast Straight Talk last year. “If something was going to happen and I could avoid it by giving all my money away, I’d give it away.”
Last week, Craig, Arthur and a consortium of investors paid $20 million for the Imperial Hotel in Singleton.
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Eryk Bagshaw is an investigative reporter for The Sydney Morning Herald and The Age.He was previously North Asia correspondent. Reach him securely on Signal @bagshawe.01Connect via X or email.
