The supermarket giant is being taken to court for alleged worker underpayment, with dozens allegedly short-changed over $100,000.
Supermarket giant Coles is being taken to court for allegedly paying more than $115 million to thousands of workers.
The Fair Work Ombudsman (FWO) has opened Federal Court proceedings against Coles Supermarkets Australia Pvt Ltd, alleging that 7,812 employees were underpaid between January 1, 2017 and March 31, 2020.
Most employees reportedly managed a department or function within Coles Supermarket, such as bakery, customer service, flavoring, dry goods, fresh produce, meat and nit-fill.
The alleged underpayment of these salaried managers ranged from a small amount to $471,647.
Forty-five of them were paid over $100,000.
Most of the perceived low pay is related to overtime entitlements under the General Retail Industry Awards 2010.
The FWO alleges that Coles’ salaried managers were typically contracted and rostered to work 40 hours per week, but often worked more hours, the salaried managers alleged that in October 2017 and March 2020.
Weekend and public holidays penalty rates, allowances and other entitlements were also reportedly underpaid.
It is further alleged that Coles violated record-keeping laws under the Fair Work Act by failing to keep proper records, including certain records relating to overtime hours worked by employees.
Affected workers were in every state and territory in regional and metropolitan areas.
The Ombudsman alleged, “Coles’ treatment program significantly underestimated the amount owed to employees and that it owed more than $108 million.”
Coles Group Ltd told FWO and the Australian Securities Exchange in 2020 that it was reviewing the wages of award-covered, salaried employees at its liquor and supermarket businesses.
Fair Work Ombudsman Sandra Parker said low pay has become a constant issue among businesses of all sizes in a variety of industries, as a result of inadequate annual pay for employees covered by rewards.
“Businesses paying annual wages cannot take a ‘set-and-forget’ approach to paying their employees. Employers must ensure that the salary being paid is sufficient to cover all minimum valid entitlements, When their employees are actually working and the work they are actually doing,” Ms Parker said.
Ms Parker said FWO is prioritizing this to ensure that large employers reporting low pay are correcting them.
“This court action against Coles should serve as a warning to all employers that they may face dire consequences if they do not prioritize compliance with workplace law,” she said.
FWO is seeking penalties against Coles for several alleged violations of workplace laws, in addition to a court order requiring the company to recover total outstanding underpayments in full, as well as interest and superannuation.
The company faces penalties of up to $63,000 per violation.
A federal court directive hearing in Sydney is yet to be scheduled.