Woolworths admits to underpaying staff by $1.24m, could face a hefty fine
ABC News
18 Apr 20245


In short: Woolworths admits it failed to properly pay long service leave to more than a thousand Victorian workers, blaming discrepancies in its IT system.
Underpayments ranged from a few hundred dollars to up to $12,000.
What's next? Woolworths is facing a fine and possible conviction.
A week of bad publicity for Woolworths just got worse.

On Tuesday, its outgoing CEO Brad Banducci was threatened with jail time for refusing to answer questions in a Senate inquiry examining supermarket price gouging.


Today, the company admitted in a Melbourne court that it short-changed at least 1,235 former Victorian employees by not properly paying their long service leave entitlements.   :(

Woolworths conceded $1.24 million of underpayments occurred between November 2018 and January 2023.

In some instances, staff were only owed a few hundred dollars. In the worst cases, it was up to $12,000.


The Melbourne Magistrates' Court was told the Woolworths Group and related company Woolstar breached Victoria's Long Service Leave Act on 1,227 occasions.

Woolworths' barrister Saul Holt KC said the company discovered the discrepancies during an audit of its IT systems, prompting it to self-report to Victoria's Wage Inspectorate.

"That's just the right thing to do," Mr Holt said.

Because of the technicalities of the breaches, Woolworths is facing a theoretical maximum fine that could exceed $10.25 billion.

Such an extraordinary penalty — which would be crippling even for a corporate giant that recorded a net profit of $1.62 billion last financial year — is not realistically on the cards.

Woolworths CBD

In court, lawyers agreed there was no ceiling on the fine magistrate Nahrain Warda could impose in this case, although financial penalties in Victorian magistrates courts are usually capped at about $480,000.

The magistrate reserved her decision until Wednesday, April 24.

On top of the incoming fine, Wage Inspectorate of Victoria barrister Kathleen Crennan called for Woolworths to be convicted.

"There's really no excuse for this to have happened in the first place," she said of the underpayments.   :(

Two days ago, Woolworths boss Banducci was accused of peddling "spin" and "bullshit" by Greens senator Nick McKim during a public inquiry, which delved into the profits of big retailers and rising prices at checkouts.

Mr Holt told the court it was "an interesting week to be talking about Woolworths", and insisted the company was "much more than just some headlines and a Senate inquiry".


Woolworths apologised to staff and attempted to track down affected former employees.
He said the company was an "exemplary employer" that was founded in 1924, and provided work to more than 200,000 staff, who are referred to internally as "team members".

The Woolworths barrister said the company apologised to its team members and had gone to great lengths to track down former staff affected by the underpayments, to ensure they received their dues and additional interest and superannuation.

In 2019, the company admitted it had underpaid 5,700 salaried staff as much as $300 million, many of whom were department managers across its retail stores.

The Fair Work Ombudsman and class action litigants are also taking on Woolworths and Coles in the Federal Court over claims of mass underpayments.

Minimum jail terms of five years for the CEO and board members of every company that underpays ( steals) from employees and it will stop happening immediately.

Put the thieves in jail were they belong!

Daves2017 wrote on Apr 21^st, 2024 at 12:25pm:

Minimum jail terms of five years for the CEO and board members of every company that underpays ( steals) from employees and it will stop happening immediately. Put the thieves in jail were they belong!

At least make the CEOs pay the people what they are owed
and the fines out of their own pocket.   ;)

Quote:

Woolworths admits it failed to properly pay long service leave to more than a thousand Victorian workers, blaming discrepancies in its IT system.

I'd like to see all the data and dollar value OVERPAID to employees, due to " discrepancies in its IT system"




.

Daves2017 wrote on Apr 21^st, 2024 at 12:25pm:

Minimum jail terms of five years for the CEO and board members of every company that underpays ( steals) from employees and it will stop happening immediately. Put the thieves in jail were they belong!

It would be a slaughter of the 'White Collars' in there with all those very physical brutes. But of course, many White Collars work out in gyms and Martial Arts/Boxing as 'hobbies' - how good they are, is anyone's guess? Many have survived extra traumas in Prisons by just proving themselves in violent fights, to be left alone eventually.

Woolworths fined $1.2 million for underpaying Victorian workers' long service leave
ABC News
April 27 2024


In short: Woolworths admitted it failed to properly pay long service leave to more than 1,200 Victorian workers, including short-changing one employee $12,000.
It self-reported to the $1.24 million underpayment to Victoria's wage inspectorate, blaming a fault in its payroll system.

Supermarket giant Woolworths has been fined more than $1.2 million for underpaying hundreds of staff more than $1 million in long service leave entitlements.   :)

Woolworths admitted in a Melbourne court last week it had short-changed at least 1,227 Victorian employees up to $1.24 million due to an error in its payroll system, which went undetected for years.

The underpayments ranged from a few hundred dollars up to $12,000, and occurred over multiple years.

Today, Magistrate Nahrain Warda described the payroll error as a "systematic and widespread failure" by one of the nation's largest private employers.

"It is gross failure on their part for not ensuring that such errors don't exist and any irregularities are stamped out early," Ms Warda said.

"It is expected that such a large corporation, that expands across all of Australia, would consequently have thorough payroll systems in place."

The magistrate said the large number of victims was an aggravating circumstance.
The court heard Woolworths updated its payroll system in 2014, but didn't undertake an audit until 2020 after "red flags" began to emerge in 2019.

Woolworths self-reported the underpayment errors to Victoria's Wage Inspectorate after the discrepancies were detected during the review.

In sentencing, Magistrate Warda said the large number of victims and the amount of the underpayments were "significant aggravating features", but said Woolworths had taken "proactive steps" to fix the payroll errors, and had self-reported the underpayments.

She fined the Woolworths Group $1,227,000 and its subsidiary Woolstar $36,000.

The company would have been fined $2.2 million if it had not pleaded guilty.

The court heard Woolworths had faced a maximum penalty of more than $10 billion.


The court heard Woolworths had been proactive in addressing the payroll errors.
Woolworths has agreed to pay back its workers what they are owed, plus interest.

In response to the judgement, Commissioner of Wage Inspectorate Victoria, Robert Hortle, said Woolworths' miscalculation of long service leave meant staff also lost out on time, not just money.

"Underpayments were as much as $12,000 which, calculated using the minimum wage, is equivalent to over 500 hours or 67 days leave," Mr Hortle said.

"It's disappointing that Woolworths, with its significant resources, has underpaid staff to such an extent."


Woolworths could have been fined up to $10 billion.(ABC News)
"Today's sentence should be a warning to businesses across the state, particularly big, well-resourced corporations there are significant penalties for breaking long service leave laws, and both the Wage Inspectorate and the court take underpayment of entitlements extremely seriously."

In 2019, Woolworths admitted it had underpaid 5,700 workers up to $300 million in unpaid wages and entitlements over the course of a decade.

The company posted a full-year profit of $1.6 billion last year, an increase of 4.6 per cent.