Embattled journalism startup News.net will suspend operations from the close of business today amid a major pay dispute with its employees and suppliers who are owed thousands of dollars in unpaid wages and invoices.
The company’s sole director Brendt Munro told staff on Wednesday evening that he had no choice but to temporarily stop operating, three days after this masthead revealed the entity was facing federal court action over its inability to pay staff and third-party services. He would not put a definitive date on when outstanding wages would be paid.
“I have had to make a decision today to suspend our operations from the end of business Friday 21 October 2022. It is with an extremely heavy heart that I do this,” Munro said in the email, obtained by this masthead.
The startup will “suspend operations” from the close of business today.Credit:Screenshot
“The company that pays the salaries is a subsidiary of a Overseas (sic) parent company. It was at this level that money was being raised to fund the pre-launch phase of the website. Because of all sorts of reasons the pre-launch phase has gone for longer than expected.”
Arguably the most ambitious local journalism ventures in decades, News.net had plans to employ 170 people within 23 weeks and launch more than 1500 local, national and international websites that could be linked to the one domain name. It intended to launch in April but continued to be delayed by technology issues. Multiple staff who have spoken to this masthead on anonymity for fear of retribution are owed, in some cases, up to two months worth of wages.
The decision by Munro to temporarily halt operations was made less than 24 hours before he was required to attend a Fair Work Commission hearing lodged by the Media Entertainment and Arts Alliance over failure to pay wages and superannuation. Multiple sources familiar with conversations between Munro and the MEAA, who requested anonymity to speak freely, said he asked for the hearing to be delayed three times before issuing the email to staff. He did not attend the meeting.
Munro is listed as the sole director of News.net a venture that formed in early April and was being led by former AAP editor-in-chief Tony Gillies. Staff were told Gillies was the chief executive and he was listed as such on the website, but he told this masthead on Sunday he was hired as a consultant. He said he has no visibility over the finances. An email to staff by Gillies on Monday said the lease on the Bond St office in Sydney, where the journalists and sales teams were based, had been terminated.
Michael Norris, a one-time owner of Brisbane radio station 4BH, was known as the “chairman” but was not listed as a director on ASIC filings.
His media empire fell apart in the mid-2000s when receivers and liquidators were appointed to 10 companies linked to him. He said at the time in the Courier Mail the public record did not reflect the “true story” of what had happened and has remained out of the public eye since then. Norris was also declared bankrupt in 2012 but was discharged in 2015, according to paperwork seen by this masthead.
This masthead does not suggest what occurred in 2006 or 2012 is related to what is currently happening at News.net.
Munro is offering staff the opportunity to resign on Friday and wait for a “payment date” that would come when consistent funds were raised and remitted. Alternatively, staff can take leave without pay until the “business is reset”.
“In the case of Option 2: Staff will stop work. Will not receive pay but be considered in the future iteration of the operation… There will be continuity of service entitlements. Outstanding monies will be paid at a date to be determined,” he said. Norris and Munro were approached for comment. Gillies declined to comment.
Munro told staff in September the company’s payment delays are caused by “anti-money laundering” laws and problems with international bank transfers. More recently he has blamed the absence of funds on shareholder issues. No employee of the company knows the identity of the shareholders.
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