The Fair Work Ombudsman has commenced legal action against Coles, alleging the supermarket giant underestimated the amount they shortchanged 7500 workers for doing more hours than they were formally paid for.
A total of 45 salaried managers are said to have been underpaid more than $100,000 each. The largest amount is $471,647.
Many of the staff are believed to have also lost out on proper penalty rates and allowances.
The court will hear the managers would generally work an extra hour per shift between October 2017 and March 2020.
Coles have spent $13 million on repayments so far, with provision of a further $12 million in their accounts.
The wages watchdog alleges, “Coles’ remediation program has significantly underestimated amounts owed to the employees and that more than $108 million remains outstanding.”
If proven, the company faces penalties of $63,000 per breach of a range of provisions.
Coles say they started to review the situation in February 2020, before the ombudsman’s investigation. They say they have since apologised to affected team members.
“Coles is currently reviewing the proceedings, which include issues relating to the interpretation and application of various provisions of the [General Retail Industry Award] and to the extent that further remediation may be required, we will update the market accordingly,” they say in a statement.
Ombudsman Sandra Parker says businesses using annual salaries should not just assume they covered all entitlements. “This court action against Coles should serve as a warning to all employers that they can face serious consequences if they do not prioritise workplace law compliance,” she says.
