Sydney-based workforce compliance platform Yellow Canary is ramping up its fight against wage theft after closing an $11 million raise today led by investment firm Parc Capital.
The raise, which also garnered support from existing investors, comes as the company looks to attract more Australian employers and offer fast, accurate and scalable compliance monitoring tools using automated technology.
Yellow Canary co-founder and managing director Marcus Zeltzer said the capital injection would give the company room to hire “more talented people” for the platform’s engineering department.
“The complexity of the workforce compliance landscape has meant that other approaches leave employers without the confidence they need to ensure that they are meeting their compliance obligations,” said Zeltzer, who co-founded the company alongside Brenton McSweyn.
“Our technology and services are ideally positioned not only for historical remediation needs but to provide ongoing compliance monitoring across the range of workforce compliance challenges facing employers.”
Founded in 2017, the regtech tech platform allows employers to manage employee payments, entitlements, superannuation, taxes and workforce composition.
Working alongside law and accounting firms, Yellow Canary has delivered real-time cost and accuracy benefits to a range of clients, which includes small businesses and ASX100 companies.
In the past year, Yellow Canary has managed over $11.4 billion in employee payments, 2.8 million payslips and 272 million work hours across industries such as banking, insurance, retail, hospitality, manufacturing and health services.
Research conducted by multinational firm PricewaterhouseCoopers (PwC) in 2020 estimates approximately 13 per cent of Australia’s total workforce was affected by underpayment, with those rates even higher in industries such as hospitality.
Using data from the Fair Work Ombudsman (FWO), PwC found the cash value of underpayment at $1.35 billion per annum. In 2020-21, the FWO completed 18,696 disputes and recovered nearly $148.4 million for almost 70,000 workers.
The latest data for superannuation underpayment estimates are just as grim, with the Australian Taxation Office (ATO) finding employers failed to provide $2.5 billion in contributions to employees’ super accounts during 2018-19. Of the 17,000 complaints received about superannuation theft, employers were found to be compliant in only 25 per cent of cases.
“We put the Yellow Canary team and technology through an exhaustive due diligence process and are very impressed with the potential of this team, the technology and of course the considerable market opportunity,” Parc Capital executive chair Grant McCorquodale said.
“There is a clear case that every ethical employer in Australia should take all steps to mitigate risks relating to workforce compliance and be able to demonstrate this to their shareholders, Boards and employees.”
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