Coles to cough up additional $25 million to rectify underpaid wages

Coles to cough up additional $25 million to rectify underpaid wages

Supermarket giant Coles (ASX: COL) has become the latest company to admit it has underpaid wages to its staff, announcing today that further investigations uncovered salaried managers are owed an additional $25 million in underpayments.

The news blows out the company’s total wage theft bill to $50 million, and comes more than a year since Coles announced it had underpaid staff, incurring $13 million in remediation costs with a further $12 million provision.

Coles is now facing a class action over the issue, as well as separate legal action by the Fair Work Ombudsman in Federal Court.

“Coles expressed its deep regret and apologised to affected team members,” the company said in an ASX announcement today.

“Coles advises that, following further consideration of the issues as they have evolved, it intends to conduct a further remediation relating to the reconciliation of available records of the days and hours of work of salaried supermarket managers.

“Coles apologises unreservedly to affected team members.”

The supermarket’s biggest competitor, Woolworths (ASX: WOW), has also been in the hot seat for underpaying staff, having admitted early last year that payroll errors had blown out its wage theft bill to $571 million.

Other companies in the last few years to face scrutiny for underpaid or lost wages to staff include The Reject Shop (ASX: TRS),Super Retail Group (ASX: SUL), David Jones, Country Road Group, Bunnings and Michael Hill (ASX: MHJ).

BHP reveals it underpaid workers $430m since 2010

Today’s news comes only a day after BHP (ASX: BHP) admitted almost 30,000 past and present employees have been underpaid by the company since 2010, and that it will cost an estimated $US280 million ($430 million) to rectify to the problem.

In an ASX announcement, BHP said a preliminary review suggests certain rostered employees across Australia had their leave incorrectly deducted on public holidays over the last 13 years.

According to the natural resources company, the issue has affected approximately 28,500 current and former employees, with an average of six leave days incorrectly deducted since 2010.

“We are sorry to all current and former employees impacted by these errors. This is not good enough and falls short of the standards we expect at BHP,” BHP Australia president Geraldine Slattery said.

“We are working to rectify and remediate these issues, with interest, as quickly as possible.”

The mining giant also said the same error was found in the payroll accounts of OZ Minerals, which wasacquired by BHP more than a month ago.

BHP estimates the cost of remediating the leave and contracting issue will cost up to US$280 million (AUD$430 million) pre-tax, incorporating on costs including associated superannuation and interest payments.

The company also identified that around 400 current and former employees at Port Hedland are entitled to additional allowances due to a second accounting error with the employment entity in their contract.

Global assurance firm Protiviti has been engaged to conduct a thorough review of BHP’s payroll systems.

The Melbourne-based mining firm has also self-reported to the Fair Work Ombudsman.

BHP said it is continuing to investigate and an update during its full-year results announcement in August.

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