Woolworths CEO Brad Banducci gives up bonus over underpayment scandal

Woolworths CEO Brad Banducci is the latest high profile chief executive to give up his bonus in the wake of a scandal.

Woolworths CEO Brad Banducci with chairman Gordon Cairns. Picture: Aaron Francis

Woolworths CEO Brad Banducci is the latest high profile chief executive to give up his short-term bonus in the wake of a scandal.

In a statement to the ASX, Mr Banducci and Woolworths chair Gordon Cairns “acknowledged their leadership responsibility” for the issues that saw thousands of Woolworths staff underpaid.

Forgoing his bonus potentitally costs Mr Banducci millions of dollars.

Woolworths revealed in October it had underpaid 5700 workers over a period of nine years to the tune of $300m.

“I have made the personal decision to forgo my F20 short-term bonus because I believe it is the right thing for me to do as CEO,” Mr Banducci said in the statement.

Mr Banducci’s target short-term bonus for the 2020 financial year was $2.6 million, Woolworths said.

Mr Cairns, meanwhile, has also given himself a pay cut.

“I accept that, as the chairman of the board, I have a higher level of responsibility than my board colleagues, and therefore have decided to take a 20 per cent reduction in my board fee for F20,” he said.

According to Woolworths’ 2019 annual report, Mr Cairns was paid $792,00 in directors fees in 2019, up from $778,000 in 2018.

There have been a number of retailers this year that have discovered and admitted underpaying wages for their staff, but Woolworths is the first major retailer to publicly announce pay cuts for its most senior executive and board member.

Woolworths is due to hold its 2019 annual general meeting on 16 December.

The Woolworths board has endorsed these proposals, the company said.

“As a group, we have let many of our salaried team members down. And our priority right now is to ensure that they receive the money they are owed as quickly as possible,” the CEO and chairman said in the statement.

“Our goal remains to finalise a full review of this issue by the end of the financial year.” “Once this is finalised, further consequences will be considered by the board. Woolworths group will provide further updates at the group’s half year F20 results in February.”