Wesfarmers underpays workers $15 million in second incident in a week

Dominic Powell

October 1, 2019

The Age

Australia’s largest retail conglomerate Wesfarmers has blamed another payroll error for underpaying workers $15 million just days after the company revealed a similar issue at its hardware retailer Bunnings.

In a statement on Tuesday, Wesfarmers said that it found the mistake when it was updating its payroll system, causing about 6000 current and former team members in its industrial and safety division to have been underpaid since 2010.

The issues affect staff  at retailer Blackwoods, workwear manufacturer Workwear Group, industrial gas supplier Coregas and health and safety management company Greencap.

The $15 million figure largely relates to the underpayment of certain allowances and entitlements, and superannuation related to car allowances.

Wesfarmers is working with auditor PwC to repay workers.

“These were inadvertent errors but they are deeply regrettable and we apologise sincerely and unreservedly to our team members who have been affected over a number of years,” Wesfarmers Industrials managing director David Baxby said in a statement.

“Our priority is to back-pay all affected team members as quickly as possible, including interest, to ensure affected team members are fully compensated. We are also investing heavily in our payroll system, processes and capabilities to fix this issue and ensure it cannot happen again.”

Wesfarmers says it has reported the non-compliance to the Fair Work Ombudsman.

Last Thursday, Wesfarmers announced it had underpaid staff at its Bunnings hardware chain superannuation entitlements for nearly 10 years.

The Age and The Sydney Morning Herald understands the two cases are unrelated to each other.

Following the Bunnings’ underpayment federal Opposition Leader Anthony Albanese said the company had committed “wage theft”, and called on the Morrison government to address the issue of worker underpayment.

“It is a good thing that the Bunnings workforce are going to receive their entitlements but how is it that this was allowed to occur unchecked for year after year after year on this government’s watch,” Mr Albanese said.

“What’s the government’s plan to ensure workers should be compensated?”

Wesfarmers follows jewellery chain Michael Hill, apparel retailer Sunglass Hut, automotive and sports retailer Super Retail Group and celebrity chef George Calombaris in the ranks of companies that have underpaid workers millions in recent months.