One of the biggest cases of underpayment in Australia is finally resolved. The company Woolworths decided to settle the issue by paying its employees before Christmas.

The company has agreed to pay an exgratia payment of $2,500 plus $20,000 superannuation to current and former salaried workers.

This payment is for supermarket employees as well as Big W, Dan Murphy’s, and BWS stores.

The total payments to the former staff add up to $50million from 2010-2013. Additionally, it includes the class action settlements. However, the company did not disclose the amount for the class action.

Background of the allegations

Back in November 2019, law firm, Adero Law filed a lawsuit against Woolworths on behalf of its employees. The firm alleged Woolworth for not paying the managers.

An independent statutory agency of the government took legal action against the company over alleged underpayments to the managers.

The fair work Ombudsman (FWO) has alleged that the retail company underpaid 70 of its employees from March 2018-March 2019.

It was a lengthy case, followed by an investigation and assessment of the employees. After an analysis of the records, FWO claimed that the company has failed to ensure proper payment to its employees.

The annual salaries were adequate when compared with actual work hours, leaving their salaried managers significantly underpaid.

FWO said,

‘’ We allege that significant underpayments have not been fully back-paid, and we will seek court orders for Woolworths to recalculate and rectify all underpayments for all affected employees’’.

It further added,

‘’ this court action highlights the large employers face serious consequences if they do not prioritize workplace law compliance among other suspects of their business.’’

It is also suggested, that employees who need assistance with Australian workplace laws must contact the Fair work ombudsman.

Fair Work ombudsman make sure that companies that do not face and prioritize workplace law compliance

Large companies must follow workplace compliance, otherwise, they will face serious consequences. Fair work said in a statement.

Woolworth‘s response to the action

Woolworths Group Chief executive Brad Banducci said the company was pleased to resolve the issue.

He said,

’’ This will ensure that our approach to full remediation can be appropriately addressed through the (Fair Work Ombudsman) proceedings,’’

He further added in his statement,

‘’ we said at the outset that we would extend our review beyond our legal obligation sand look back to 2010.’’

Meanwhile, there is a separate legal action underway against the retail company. A spoke person from the FWO told ABC that it’s not appropriate for it to comment. The matter is before the court.