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Wesfarmers fesses up to $9m in underpayments, this time at Target

Maja Garaca Djurdjevic
Maja Garaca Djurdjevic
19 February 2020 1 minute readShare

Australian conglomerate Wesfarmers has confessed yet again to underpaying staff, this time at its general merchandise chain Target, to the tune of $9 million, adding to the $15 million it confessed to earlier at its industrial safety business.

The Perth-headquartered group revealed $9 million in underpayment remediation costs in its half-year statement published on Wednesday.  

The latest disclosure comes just a day after Coles, a company in which Wesfarmers owns a significant stake, owned up to $15 million in unpaid wages.

“Immediate steps are being taken to rectify identified issues, notify and repay affected team members, including interest, and ensure accuracy in the future through a robust program of auditing and monitoring,” Wesfarmers CEO Rob Scott said in a statement.

Late last year, Wesfarmers-owned Bunnings revealed that it had underpaid employee superannuation over an eight-year period as the result of a payroll error.

At the time, Wesfarmers Industrial managing director David Baxby said the company has “significant resources... dedicated to resolving and remedying all underpayments” as quickly as possible, and that PwC had been engaged to conduct an external review into the extent and exact nature of the underpayments.

The situation was said to have been discovered during testing of a new payroll system.

“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,” Mr Baxby said.

Naming and shaming

On Tuesday, the government released a discussion paper outlining a range of reform options to tackle wage underpayments, including the possibility of forcing companies that commit wage theft to name and shame themselves with public signs.

This would add to the government’s already slated introduction of legislation that will criminalise the most serious forms of deliberate worker exploitation and wage underpayments and introduce significant jail terms and fines in the coming weeks.  

“Like most Australians, the government has been appalled by the number of companies that have recently admitted short-changing their staff — in some cases by hundreds of millions of dollars,” the Attorney-General and Minister for Industrial Relations, Christian Porter, said on occasion of the release.

“While it’s understood the vast majority of these underpayments were not deliberate and were rectified swiftly, they are incredibly serious and border on negligence given we are talking about sophisticated organisations that should be capable of meeting their obligations under workplace law.”

Wesfarmers fesses up to $9m in underpayments, this time at Target
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Maja Garaca Djurdjevic
Maja Garaca Djurdjevic

Maja Garaca Djurdjevic is the editor of My Business. 

Maja has a decade-long career in journalism across finance, business and politics. Now a well-versed reporter in the SME and accounting arena, prior to joining Momentum Media, Maja reported for several established news outlets in Southeast Europe, scrutinising key processes in post-conflict societies and enabling citizens to influence decision-making.

You can email Maja on [email protected] 

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