1. News
December 3, 2021

Coles faces legal action over staff underpayment allegations

The Australian supermarket chain has been accused of underpaying more than 7,500 employees.

Coles Supermarkets Australia is facing legal proceedings over allegations of underpaying thousands of workers by a total of $115.2m.

The legal action has been brought by the Fair Work Ombudsman (FWO), which alleged that the retailer had underpaid more than 7,812 salaried employees between 1 January 2017 and 31 March 2020.

The charge follows an evaluation of the salaried Coles employees’ wages and entitlements by the watchdog.

Affected Coles employees were in regional and metropolitan areas across every state and territory, with most either managing a department or responsible for performing a function within the supermarket.

The watchdog also said that most of the alleged underpayments were associated with overtime entitlements under the General Retail Industry Award 2010.

During the assessment, it was found that Coles’ salaried managers worked an average of around one hour extra between October 2017 and March 2020.

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This was in addition to their rostered hours for each shift, which amounted to 40 hours a week.

In addition, Coles has been accused of underpaying allowances, weekend and public holiday penalty rates and several other entitlements.

The retailer has also violated record-keeping laws under the Fair Work Act.

It is currently facing up to $63,000 in fines for the alleged breach of workplace laws.

Fair Work Ombudsman Sandra Parker said: “Businesses paying annual salaries cannot take a ‘set-and-forget’ approach to paying their workers.

“Employers must ensure wages being paid are sufficient to cover all minimum lawful entitlements for the hours their employees are actually working and the work they are actually doing.”

Earlier this year, Australian supermarket chain Woolworths faced similar legal action for underpaying 70 of its employees by a total of A$1.17m ($883.1k) from March 2018 to March 2019.

Employees’ records were investigated and assessed after Woolworths told the FWO and Australian Securities Exchange in 2019 that it had underpaid the workers.