Failed Hotel Quarantine Provider Prepares Second Claim for Payment From Australian State Government

The Honourable Jennifer Coate AO speaks during COVID-19 Hotel Quarantine Inquiry in Melbourne, Australia on July 20, 2020. (James Ross - Pool/Getty Images)

The company that provided security guards for hotel quarantine during Melbourne’s infamous second wave is preparing to refile a payment claim against the Victorian state government for $10.7 million.

Unified Security Group, which was the principal contractor in both the Victorian and NSW hotel quarantine programs, alleged that the Victorian state government never paid its bill for services rendered, reported The Australian.

The amount forms part of the $41.7 million that Unified invoiced the state for providing security guards to 13 quarantine hotels.

But Unified’s payment claim against the state lapsed after the security company went into liquidation in May. Moreover, the Victorian government did not file its defence to the Supreme Court proceedings.

At that time insolvency liquidator, Trent McMillen said that he was in discussions with a litigation funder for the case.

McMillen told The Australian that the case was proceeding without a litigation funder after a firm was engaged to prepare action against the state for the outstanding payment.

In the first case filed against the Victorian government last year, Unified alleged that the state did not pay the company for costs by security guards who delivered Easter eggs and Mother’s Day gifts to hotel quarantine guests.

Unified also alleged that it is owed $218,730, not including GST, for meal allowances.

However, the Victorian state government blocked payments to Unified after it was found that the company utilised subcontractors to guard hotels without state approval.

This follows an investigation by the Fair Work Ombudsman that found security guards who ran hotel quarantine in Melbourne and Sydney were owed more than $1 million in unpaid wages. Unified Security admitted they owed nearly $900,000 in unpaid entitlement to staff in Sydney, and was issued a compliance notice to backpay employees, reported News Corp.

Unified is also alleged to owe nearly $200,000 to another contractor for Victorian operations, despite claiming over $7 million in JobKeeper and receiving more than $90 million worth of work in NSW and Victorian hotel quarantine program reported The Australian.

Moreover, almost $20 million in loans and dividends were paid to a holding company controlled by David Millward and Luigi Trunzo when Unified collapsed in May. Millward and Trunzo have been identified as potential shadow directors, reported The Australian.

In October 2020, a class action (pdf) against defendants’ Unified Security Group and MSS Security—the two companies contracted to provide hotel security to the Rydges and Stamford Plaza hotels—was filed in Victoria’s Supreme Court for damages alleging the security companies “caused at least 99.8% of COVID-19 cases in Victoria from May 2020.”

In September 2021, WorkSafe Victoria charged the Department of Health, formerly the Department of Health and Human Services, with 58 breaches of the Occupational Health Safety Act over the leaks of the CCP virus from hotel quarantine that sparked the state’s deadly second wave.

However, Self Employed Australia, an organisation representing business owners, is set to launch a legal challenge against Worksafe Victoria to force the prosecution of Premier Daniel Andrews, Chief Health Officer Brett Sutton, former health minister Jenny Mikakos and other senior bureaucrats over the bungled hotel quarantine program.