More than $1 million of taxpayer money is owed by private training establishment Workforce Development Ltd after repeated breaches of funding conditions.

Staff have filed a claim for unjustified dismissal while some students are left in limbo with incomplete courses.

The organisation appears shut down, but is still allowing students to apply to study via its website.

Instead of preparing for a day of teaching, the tutors are discussing legal action.

Teacher Stewart Whyte said: “I wouldn’t wish what we’ve been through as a team of staff on anybody.”

Twenty-three staff are owed at least eight weeks pay, plus other entitlements.

“There’s a whole process that employers need to follow that the employees are alleging were not followed here,” Thrive Lawyers director Laura Pelly said.

It comes after the sudden closure of Workforce Development Ltd (WDL), which teaches a range of courses, from cooking to youth work.

Whyte added: “The kaupapa we had there was a family and we helped each other as much as we could … We also went to the Salvation Army in Hastings with regards to seeing if we can get food parcels for staff. We’ve had to go the extra mile to ensure staff have been supported.”

The first signs of trouble came in December when pay was delayed, and then stopped coming.

Despite this, they kept teaching.

“We’ve protected our students from any fallout from this saga … the staff are just awesome.”

1News has uncovered just how big the financial difficulties facing the Hawke’s Bay company are.

Problems appeared to start in 2021 when the Tertiary Education Commission (TEC) carried out a routine audit.

It turned into an investigation, which found “a number of instances of noncompliance with funding rules”. This included inaccurate reporting of enrolments, claiming funding for invalid enrolments, and invalid awarding of qualifications.

Three quarters of records checked had the wrong start dates for learners, often a difference of several months.

The TEC stopped funding WDL in June last year. But subsequent investigations found substantial amounts of taxpayer dollars were wrongly paid out. More than $1 million is still owing.

Staff were working on the issues raised in audits, but had no idea of the extent of the financial hole, until 1News told them.

“It’s really surprising to hear the company owes that much money,” Whyte said.

Offices in Napier and Auckland are deserted, however the website is still active and encouraging applications.

The qualifications authority de-registered WDL in mid-March. Teaching was stopped nine days later. Around 40 students were enrolled then, half now have incomplete courses.

A claim has been filed to the Employment Relations Authority for lost wages and personal grievance for unjustified dismissal.

Pelly said it is a question of “fairness and respect”.

“The employees obviously want to be paid for their work they carried out and they also wanted to be consulted with in regards to the restructure.”

Staff hope speaking out might mean they are paid what they are owed.

When contacted by 1News, owner Aaron Smith said staff would be paid in the next few weeks.