Aussie workers still owed millions in underpayment scandals
There were no shortage of underpayment cases this year that short-changed Aussie workers by million of dollars. And some are still waiting for their hard-earned money as the new year rolls in.
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Workers hit by some of the biggest underpayment scandals this year could still be awaiting payment as 2020 rolls in.
News Corp contacted a number of high-profile businesses which collectively short-changed staff by as much as much as $300 million and found that some cases were still in progress.
Here’s where things are at:
ABC
The ABC dropped a bombshell in January when it admitted as many as 2500 could have been underpaid.
ABC’s chief people officer Rebekah Donaldson said that “penalties, allowances and loadings” that should have been awarded to casual staff were overlooked.
The staff were instead paid a “flat rate”
It came just a few weeks after the national broadcaster acknowledged it had short-changed a Brisbane-based employee by $19,000.
The Community and Public Sector Union said following a review that employees in some parts of the ABC were treated as “second-class workers”
“Our investigations show that some ABC managers fully exploited casual employees on loaded rates, rostering them almost exclusively for weekend and public holiday work because it was cheaper than using employees who were paid penalties,” it said.
The exact underpayment figure has not yet been revealed, but the ABC set aside $22.98 million for the debacle.
An ABC spokesman told News Corp 1443 of the 1886 employees found to be underpaid were recently backpaid.
The spokesman said the national broadcaster hoped to finalise remaining payments in the New Year.
“We are working through the payment process and won’t be able to reconcile the total costs until all payments are finalised,” the spokesman said.
GEORGE CALOMBARIS (MAdE ESTABLISHMENT)
In what was arguably the year’s most high-profile underpayment scandal, celebrity chef George Calombaris was rocked by a $7.83 million backpay bill.
More than 500 staff who worked at his MAdE Establishment group of companies between 2011 and 2017 were victims of the massive discrepancy, which was self-reported to Fair Work. Nine employees at Jimmy Grants also received payments.
Calombaris was also ordered to pay a $200,000 “contrition payment” which some viewed as a slap on the wrist.
There were calls he should lose his position on MasterChef.
It was a fate he would eventually meet, but Network 10 said it was not the result of the underpayment scandal.
“For the seriousness of this crime, a $200,000 fine is not sufficient,” United Voice union Jo-Anne Schofield said.
“If someone deliberately took $1000 out of someone else’s bank account, there would be a high likelihood of a criminal conviction for theft. But when you’re a multi-millionaire restaurateur / celebrity chef you can take $7.83m in wages from your workers and get away with a ‘contrition payment’.”
Calombaris was “deeply sorry” for the issue which resulted in an agreement where each venue will be independently audited for the next three years.
WOOLWORTHS
Retail giant Woolworths announced in October that at least 5700 staff had been short-changed as much as $300 million in what became Australia’s biggest underpayment breach.
A review by the company covering a two-year period from 2017 to 2019 found managerial staff on annualised salaries – which encompass shift penalties and overtime – were dudded because entitlements should have been applied if their packages earned them less than what was possible under the General Retail Industry Award.
The company self-reported the discrepancy to Fair Work.
Woolworths said current and former staff at supermarkets and metro stores would have “interim back payments” made by Christmas.
It had commenced a review across all its brands, including Dan Murphy’s and Big W, with the number of underpaid staff expected to rise.
An update on the progress of the review and financial impact will be provided at the Woolworth’s half-year results in February 2020.
In response to a class action lead by Adero Law, which claims the backpay bill could be as high as $620 million, Woolworths said it was ready to “fully defend” itself.
SUPER RETAIL GROUP
The parent company of big brands including Rebel Sport, Supercheap Auto and Rays Outdoors confirmed in February that store managers had missed out on about $32 million.
Super Retail Group had failed to apply overtime rates properly for about 3000 current and former employees over the past six years.
It wasn’t the first time underpayments had been uncovered, with the company revealing last year that workers setting up new stores had missed out on $8 million.
The group also set aside $11 million to cover interest and payroll tax, brining the grand total of the underpayment scandal to $43 million.
“We are very disappointed that we have let these team members down and not met our standards, and we apologise to each person affected unreservedly,” CEO Peter Birtles said at the time.
A Super Retail Group spokesman told News Corp: “After identifying the issue, we engaged Deloitte to analyse almost two million shifts undertaken by retail management team members to comprehensively identify and calculate any individual underpayments.
“We are well advanced in our back payments to our retail management team and expect to complete the process early in the New Year.”
COMMONWEALTH BANK
Australia’s biggest bank blamed errors in its systems for underpayments worth millions of dollars.
Commonwealth Bank announced in April it would reimburse about 8000 staff who had been short-changed on wages and superannuation payments.
The Financial Services Union estimated the total could be as much as $15 million, a figure the financial giant did not confirm or deny. It instead said the first run of back payments would be worth $4.8 million.
Staff of Bankwest – Commonwealth Bank’s subsidiary – were also affected.
But in mid-December, the figure exploded.
Following a review of that covered 10 million pay slips that covered 250,000 current and former staff, Australia’s biggest bank announced the bill was as much as $53.1 million.
It said so fair it had notified and repaid 41,000 employees with $13.2 million plus interest, with another $14.9 million to follow soon after.
A further $25 million in remaining payments would be made by the end of the financial year.
“This should never have happened and I apologise to anyone impacted by these past errors,” CBA chief executive Matt Comyn said.
MICHAEL HILL
In July, Brisbane-based jewellery chain Michael Hill revealed in an ASX announcement it had failed to apply the retail award properly, generating a backpay bill up to $25 million.
A review by PricewaterhouseCoopers of employee contracts and rosters had discovered some former and current Australian store employees been dudded over the last six financial years.
Chief executive Daniel Bracken, who took over the role in November, said the retailer was contacting all staff to apologise and outline a process to promptly pay those affected.
“We will move as quickly as possible to rectify any underpayments with those team members affected,” he said.
A spokesman for the jeweller told News Corp: “Michael Hill has dedicated teams ensuring that the misapplication of the General Retail Industry Award for a portion of our workforce is corrected and any monies owed are paid in full, this financial year.”
SUNGLASS HUT
Hundreds of part-time workers at Sunglass Hut missed out on $2.3 million in payments between 2010 and 2016.
The revelation came in September after the retailer self-reported to the Fair Work Ombudsman. Individual underpayments ranged from $4 up to $42,912 and they occurred at 23 stores across every state and territory.
At the time the underpayments were revealed, Sunglass Hut had back-paid $1,485,590 to affected staff and was required to pay a remaining $815,391 in unpaid overtime wages.
It was also subject to a court-enforceable undertakertaking, which requires it to fund external auditors to check pay and conditions for workers every years until it expires in 2022.
Sunglass Hut’s parent company, Luxottica, did not respond to a News Corp request for an update on the underpayment case
NEIL PERRY ROCKPOOL DINING GROUP
Celebrity chef Neil Perry’s restaurant chain was rocked again when it was alleged it engaged was responsible for one of the “most egregious cases of wage theft” seen in Australia.
The explosive claim came after Rockpool Dining Group back paid $1.6 million for one year’s underpayment in 2018.
It then extended those repayments stretching back a further five years but did not reveal the total cost.
Legal firm Maurice Blackburn acting for the Hospo Voice union slammed the high-end restaurant, saying penalties of up to $126,000 should be paid to each employee who was “subject to unlawful conduct”.
It’s claimed some staff were told to alter timekeeping records in order to slash overtime payments, among other breaches.
A spokesman for the high-end restaurant group said told Nine Newspapers in October it had no knowledge of the legal action submitted to the Fair Work Ombudsman.
A Hospo Voice spokeswoman recently told News Corp the case was progressing.
QANTAS
An employment bungle lead to a mix of underpayments and overpayments in Qantas’ marketing team.
Australia’s national carrier revealed in February that 220 employees had been incorrectly placed on contracts rather than enterprise agreements.
The mix-up resulted in 55 staff being underpaid an average of $8000 a year, while the rest were overpaid an average of $12,000 a year.
Those who were short-changed would be reimbursed with interest, while the remained would continue to receive the above-award rates.
A Qantas spokesman told News Corp the case was in a “well advanced” stage.