Kevin Rudd's wife may consider selling her multi-million dollar employment empire following an unfortunate slip-up.
This follows one of her companies inadvertently derailing Labor's attack on the government's industrial relations laws.
Therese Rein’s business activities embarrassed the federal opposition leader when it was revealed a Melbourne company she bought last year had underpaid 58 workers a total of $70,000.
The company had put the workers on individual contracts which wrongly stripped away award conditions in return for 45 cents extra an hour.
The revelation came as Labor was leading an attack on a template Australian Workplace Agreement (AWA) for the hotel and motel industry.
The owners of a Goulburn motel who have attempted to introduce the new AWA have received hate mail and harassing phone calls since Labor highlighted the case, the government said today.
Mr Rudd said he felt sorry for employers who were wrongly targeted.
But he said his wife had made an honest mistake based on incorrect information from the previous owners of the company.
Mr Rudd denied that his wife, who is in London on business, had set out to exploit workers.
"This was obviously an honest mistake and she sought to rectify this as soon as she had the information available to her," he told reporters in a late afternoon press conference.
"I would be dishonest with you if I said it's not embarrassing that these things happen. Of course it is embarrassing."
The bungle raises questions about whether Ms Rein's job placement empire, which has several federal government contracts, would cause any conflicts of interest should Labor win this year's federal election and Mr Rudd become prime minister.
Mr Rudd has previously said that he would take advice from the head of the prime minister's department on the matter should he win office.
But today he said he and his wife would be talking the matter over before the election.
This one is tough because it affects her and her future," he said.
"I love my wife dearly and she's built this up from scratch.
"So do you turn around and say, `well that's the end of that, sweetheart', or do you do it differently?
"It's a very hard decision to say to someone prior to an election – and we don't know who's going to win the election – offload the business.
"This is the age of professional women who run their own companies, who have their own lives, and are not simply appendages of middle-aged men."
Ms Rein's company WorkDirections Australia acquired job placement company Your Employment Services (YES) last July and put its 200 workers on common law contracts.
But it later discovered 58 of the workers had been wrongly classified by the company's previous owner, leading to the underpayment under the new contracts.
Workplace Relations Minister Joe Hockey said it was unlawful for common law contracts to remove conditions from an award, but declined to comment directly on Ms Rein's company.
WorkDirections Australia spotted the mistake last December and all but eight of the workers have since been repaid.
Mr Rudd refused to say whether Labor would give other employers time to put their case before attacking them publicly over dodgy Australian Workplace Agreements.
"I feel sorry for any employer who has no choice but to act under Australia's current industrial relations laws and when they cop it unfairly in terms of public reaction."
Labor has pledged to scrap AWAs if elected.
Mr Rudd said his wife's companies did not use AWAs as a matter of principle.