Woolworths facing class action over salary payments

06 December, 2019 by Andy Young

A Canberra law firm has notified Woolworths of its intention to file an employee class action proceedings against the Woolworths Group in the Federal Court.

The action is in relation to payment shortfalls to Woolworths salaried store team members covered by the General Retail Industry Award, which the company detailed early this year.

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In a statement about the proposed class action, Woolworths said: “On 30 October 2019, Woolworths Group committed to fully rectify all payment shortfalls to current and former salaried team members across the Group, including interest and superannuation contributions, as soon as possible.

“In keeping with that commitment, Woolworths Group continues to work towards making interim payments (including superannuation contributions and interest) before Christmas, to affected current and former salaried Supermarkets and Metro store team members for the two years reviewed to date (September 2017 to August 2019).

“In the context of its commitment to fully remediate all affected salaried team members, Woolworths Group believes the class action proceedings are without merit. Woolworths Group will fully defend the proceedings.”

When Woolworths identified the payment shortfalls the supermarket giant said it related to approximately 5700 salaried staff and that it estimated a cost remediation package to be in the range of $200-300 million (before tax).

Last week Woolworths Group CEO Brad Banducci and Chairman Gordon Cairns acknowledged their leadership responsibility for the payment shortfalls. As part of that acknowledgement Banducci said he had made the personal decision to forgo his F20 short-term bonus of $2.6m and Cairns has taken a 20 per cent reduction in his Board fee for the financial year.

The pair stated: “As a Group, we have let many of our salaried team members down. And our priority right now is to ensure that they receive the money they are owed as quickly as possible.”

“Our goal remains to finalise a full review of this issue by the end of the financial year.”

Once the issue is finalised, Woolworths said that further consequences will be considered by the Board. Woolworths Group will provide further updates at the Group’s Half Year F20 results in February.