Romeo’s Retail Group agrees to settle multimillion-dollar wage class action

Romeo’s Retail Group has agreed to pay millions to settle a pay dispute with hundreds of current and former staff in SA and NSW. Are you owed money?

One of South Australia’s largest independent supermarket groups has agreed to settle a multimillion-dollar pay dispute.

Under the terms of the proposed class action settlement, Romeo’s Retail Group will pay out $1.55 million to current and former staff, who had claimed they were underpaid while working at Romeo’s stores between 2014 and 2020.

The terms of the proposed settlement are detailed in orders issued by the Federal Court on Friday, and require court approval.

If approved, the lump-sum payment will be divided between employees who have already registered to be part of the proceedings. And the payout figure could rise, with other eligible staff members given until January 7 to register their claims.

Adero Law, which began the action on behalf of employees last year, suggested at the time that about 500 current and former employees could be entitled to compensation.

As part of the settlement agreement, Romeo’s has also agreed to cover legal costs of $825,000.

Romeo’s Retail group is led by brothers Anthony, Paul and Joseph Romeo. Picture: Jennie Groom

Adero lawyer Ash Cutchie said the settlement was a positive outcome for affected employees, who were likely to receive their compensation payments early next year.

“Adero Law is pleased the matter has resolved without the need for a long and expensive trial, and that recovery for group members has been quick and efficient,” he said.

“The Romeo’s class action is the first settlement of an underpayment class action in recent history, but it won’t be the last. Adero Law is actively investigating industries which employ a large number of younger workers such as the hospitality and retail industries, which are at a statistically higher risk of wage underpayment.”

Class actions were filed against two Romeo’s entities in the Federal Court in July and November of last year, on behalf of a group of store managers and other salaried employees who worked at several of the group’s Foodland, IGA and Romeo’s branded stores across South Australia and NSW.

They had claimed that Romeo’s failed to pay penalty rates, overtime and annual leave loading, wrongfully deducted the cost of uniforms from their pay and failed to pay travel, meal and laundry allowances.

Adero Law, which launched the action on behalf of employees, suggested at the time that about 500 current and former employees could be entitled to compensation, with “conservative estimates” pointing to a potential liability of up to $20 million.

The proceedings covered 14 stores across NSW and 12 in SA, including at Athelstone, Fairview Park, Modbury, Stirling and Normanville.

Settlement payments to eligible employees will be calculated based on a number of factors including the individual’s position, award level and number of hours worked.

The proposed settlement comes with no admission of liability on the part of Romeo’s, and class action members are prevented from making future claims for underpayment against the company regarding the six-year period covered by the class action.

The statute of limitations for underpayments in Australia restricts compensation claims to the six years predating the lodging of legal action.

Adero is currently progressing several other high-profile underpayment class actions through the courts, including against South Australian retail chains OTR and Drakes Supermarkets.

Mr Cutchie said a provisional settlement was currently being negotiated with Drakes, following a recent provisional settlement agreement with Woolworths for an underpayment class action filed in 2019.

Originally published as Romeo’s Retail Group agrees to settle multimillion-dollar wage class action