Daily Management Review

Australian Retailer Woolworths Sued By Country’s Watchdog Over Staff Underpayments


Australian Retailer Woolworths Sued By Country’s Watchdog Over Staff Underpayments
The industrial relations watchdog of Australia has filed a case against the country’s largest supermarket chain Woolworths Group over allegations that the company underpaid its staff. It was more than a year ago that the company had admitted that it was not making fill payments to thousands of its workers.
Civil proceedings at the Federal Court has been filed b the Australia’s Fair Work Ombudsman (FWO) in which the body has sought the repayment of outstanding amounts that the watchdog alleged that Woolworths still has ot pay its workers while also demanding penalties against the supermarket giant.
Woolworths had only back-paid about 40 per cent of the A$1.172 million that it still owed those people, the regulatory body found, after it conducted a close review of a sample of 70 employee files out of about 19,000 workers that were allegedly underpaid by the company.
The regulator wants the court to force Woolworths "to rectify the total outstanding underpayments in relation to the 70 managers whose records were assessed and ... to then apply those calculation methods to rectify any underpayments owed to all other affected salaried managers, plus interest and superannuation," it said in a statement on the issue.
It was reviewing the proceedings, Woolworths said in a statement, and added that it was continuing to remediate affected staff and that there was "considerable uncertainty" about the issues raised by the proceedings. It also said that it had repaid A$370 million to current and former employees so far.
Woolworths admitted in October 2019 that thousands of supermarket workers had been underpaid by it for years
This revelation also prompted some Australian politicians to give a call for launching of a parliamentary inquiry into what they called "wage theft" in Australia.
A one-off A$500 million remediation charge related to the shortfalls was booked by Woolworths in June 2020.
The magnitude of the proposed penalty on the company that it was seeking in the court order was not disclosed by the FWO because that would only be decided once the company has been found to be guilty in the case.
In addition to Woolworths government investigations against about 90 other companies that had themselves declared that they had made underpayments to workers were also ongoing. Such companies included some large listed companies that were not named, according to reports quoting sources with knowledge of the investigations.
"We investigate each self-report made by a corporate entity, and we expect these employers to fully co-operate with our investigations to ensure that employees are quickly repaid their entitlements. Our investigations include a rigorous analysis of how those rectifications are completed to ensure they are accurate."