Amanda from Adelaide, a disgruntled
customer of ABC
Learning, was the first to write to Crikey a month ago about her
first-hand experiences with the child-care provider. She wrote, “in the year after ABC
Learning Centres took over operating my children’s childcare centre in Wayville
South Australia:

  • real grass was removed and
    replaced with plastic
  • the cook and the cleaner
    were fired
  • the childcare workers were
    asked to cook on roster (manageable)
  • then they were asked to
    clean with no extra extension of hours eg clean up while minding 30 kids
    (truly!)”

Amanda’s account provoked torrents of feedback. Some people fiercely defended
their ABC child-care centre but the majority of comments Crikey received were negative.

CEO Eddie Groves is a
hero of the business media. ABC Learning controls about a
fifth of Australia’s 4,000-plus child-care centres and is growing at a furious rate. Shares are up from
an initial $2 to around $8. But yesterday, the company received a
setback.

The Supreme Court in Victoria
rejected an appeal by ABC Learning
to overturn a $200 fine issued to the company by the Magistrates’ Court
after a toddler ran away from its Hoppers Crossing centre. Central to
ABC’s failed bid was the argument that criminal blame should rest
only with individual
child-care workers, rather than the company.

Victorian Department of Human
Services spokesperson Brendan Ryan told
Crikey: “We
welcome the decision. It
vindicates the action taken by a parent to protect children in
child care” and it provides parents of children in child care “with relief and
reassurance.”

ABC Learning spokesperson
Scott Emerson told Crikey that the company was “disappointed” and “will
be reviewing” the judge’s decision. If ABC Learning do
decide to appeal, as expected, there could be far ranging consequences for child care
workers, parents and their children if they win out.

So far, Groves
has made an astounding success of his ever-expanding business, despite
venturing into such a high risk area. ABC is built around the most unpredictable and demanding of
customers – a client base of parents and their precious toddlers. Anything can happen in the playground – a
child (one of 20 or 30 under a worker’s care at any one time) is bound to
fall off a swing, ingest a toxic substance, or take a
swing at
another child, no
matter how well-trained and attentive workers are.

When there’s a powerful franchise at stake, one bad
publicity story about a kid taking off down the road can threaten to
bring the
whole brand down. Some of the cases working their way through the
courts at the moment include a request to the Supreme Court
to stop the Victorian DHS from asking for details and documents
relating
to alleged breaches in care at two ABC centres. In another
case, a former employee is suing over allegations that unsafe workplaces
left her
unborn child severely disabled. Meanwhile, a series of complaints are being investigated by the Victorian DHS about incidents
at the Bendigo ABC Learning Centre, including one in which a toddler
came home with a broken elbow, unnoticed by staff. And an East
Melbourne ABC centre is under investigation after a four-year-old got lost in a lift.

So how do you manage such a risky business on such a massive
scale? ABC Learning is now the world’s biggest child-care provider –
and it’s about to move into the US.
Private child-care provision on this
scale has never
been attempted before. Groves must balance the demands of thousands of
toddlers (up to 42,000 by the end of June) with the demands of his
shareholders.

But the Supreme Court’s
decision has done nothing to dent ABC’s share
price (in a
weaker market this morning, stock is down two cents). So at what point,
if any, will negative feedback about ABC Learning start to bite?

If you have any feedback about ABC Learning, email boss@crikey.com.au