The Reject Shop is facing a class action for allegedly shortchanging staff millions of dollars in what is the first in a wave of litigation against ASX-listed retailers over underpayments.

Adero Law launched Federal Court action against The Reject Shop last week and is alleging the discount retailer underpaid up to 1400 salaried managers an average $40,000 to $65,000 due to excessive hours that brought their hourly pay below the award minimum.