ATO Debt Collection: Outsourced Workers Face Lower Pay, Poor Conditions & Inconsistent Decisions

A former Australian Taxation Office (ATO) debt collector described working conditions as akin to a “battery hen” operation, alleging poor safety standards and inconsistent decision-making impacting taxpayers. The allegations center on Recoveriescorp, a private company contracted by the ATO to pursue overdue debts.

The former employee, who requested anonymity due to confidentiality provisions, told Guardian Australia that staff were pressured to prioritize call volume over thoroughness, even at the expense of basic occupational health and safety. “You’d get pulled up for taking too long going to the toilet,” they said.

Another former Recoveriescorp worker highlighted high resignation rates as a critical issue, arguing that constant staff turnover leads to inexperienced personnel making crucial decisions about taxpayers’ debt repayments. “The tax office is well aware that this is happening because they would have the attrition numbers,” the former worker stated. “The ATO would also see the number of complaints rising. The public actually knows there’s something wrong but at the finish of the day it comes down to cost, which is not fair on us, or taxpayers.”

The ATO relies heavily on external labour, utilizing companies like Probe Operations, Concentrix Services, Serco and Recoveriescorp. According to government tender data, the ATO has awarded Recoveriescorp $42.8 million in contracts since 2022. Recent analysis reveals that Recoveriescorp has not paid corporate tax in recent years, despite substantial revenue exceeding $100 million in 2025 for its parent entity, Symbos Bidco, according to the Guardian.

Recoveriescorp employees are embedded within ATO offices, sometimes instructed to present themselves as ATO staff when interacting with taxpayers, alongside those working directly under the Recoveriescorp banner. The company stated it was unable to comment on the allegations due to contractual restrictions.

Between January 2024 and October 2025, the ATO referred over 355,000 taxpayers to Recoveriescorp for debt collection. The ATO declined to provide more recent figures.

The increased reliance on Recoveriescorp coincides with the ATO’s efforts to recover more than $50 billion in outstanding collectible debt, a figure that grew during the COVID-19 pandemic. A recent review by the Tax Ombudsman found the ATO’s decision-making in these cases to be “inconsistent,” citing “vague guidance and poor communication” leading to “confusion and unfair outcomes” for taxpayers seeking interest charge reductions or refunds.

Taxpayer complaints regarding debt collection have doubled in the past year, according to Tax Ombudsman Ruth Owen. “Mostly the complaints I get are from people who actually desire to pay their debt back, but they can’t meet the conditions that the ATO has set for them,” Owen told Guardian Australia. She also pointed to the impact of compounding interest, stating that even small debts can quickly escalate with a 10.65% compounding interest rate.

The Community and Public Sector Union attributes the increased outsourcing to decisions made by previous Coalition governments, but Labor’s attempts to bring skills back in-house have stalled. Despite defending the use of outsourced providers as a response to “surges in demand” before parliamentary committees, the Tax Ombudsman maintains that the current model is the ATO’s “chosen model throughout the year.”

In the 2024-25 fiscal year, the ATO spent more than $316 million on external labour, according to figures provided to parliament.

Greens senator Barbara Pocock criticized the ATO’s practice of embedding outsourced workers within its offices, stating it has “created a two-class system within the public sector.” She added, “This is yet another example of the ATO outsourcing core work to workers subjected to worse pay and conditions than others doing the same job.”

Employment relations expert David Peetz, a professor at Griffith University, described the outsourcing model as reaching a “higher level of stupidity,” warning that once embedded, budgetary adjustments make reversing the practice difficult.

The ATO maintains that Recoveriescorp employees receive training comparable to that of ATO officers and operate under “strict ATO controls, oversight and governance arrangements.” An ATO spokesperson stated that Recoveriescorp handles “high volume, lower complexity cases,” allowing internal staff to focus on more specialized support and stronger collection actions.

Former Recoveriescorp workers embedded within the ATO reported earning approximately $60,000 annually, which they claim is $15,000 to $20,000 less than their public service counterparts performing similar work. They also reported shorter breaks and less time for administrative tasks.

One former worker described their role as deciding on taxpayer requests for interest reductions or refunds, alleging that “inadequate training” resulted in inconsistent decisions impacting people’s financial well-being. “It can arrive down to luck,” they said. “You might get a favourable response, like getting interest waived, but then you might get a straight out rejection because of a staff member’s lack of training. It’s just not fair on people who are generally looking to work with the ATO.”