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Wesfarmers admits underpaying Target staff $9m

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Wesfarmers has revealed it underpaid staff at its Target stores by $9m, on top of $15m in other underpayments, becoming the latest Australian company caught up in a growing wage theft scandal the shoppies’ union has branded a “full blown epidemic”.

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Wesfarmers today revealed in its results for the six months to December 31 a “payroll remediation” for staff at Target, as well as $15m for its industrial and safety division.

The company gave little other detail about its latest underpayments, which come after it admitted in November to underpaying $6m superannuation at Bunnings and a range of other sites and brands.

“Following the payroll errors previously identified, Wesfarmers’ businesses have conducted extensive reviews of their respective payroll systems and processes,” Wesfarmers said today in its release to the ASX.

“As a result of these reviews, some additional payroll errors have been identified.”

It comes after Coles yesterday said it was expecting a $20 million hit, after admitting to underpaying managers at its supermarkets and liquor stores $15m across the past six years, and adding on an extra $5m in interest and costs.

In October last year, Woolworths revealed it had underpaid its employees by as much as $300 million over a decade.

Celebrity chef George Calombaris’ restaurant empire and hospitality group MAdE was placed into receivership last week after being crippled by revelations that it had underpaid staff by $7.8m.

Rockpool Dining Group, the ABC, Qantas, Super Retail Group, Commonwealth Bank and  7-Eleven are among other organisations which have recently admitted wage underpayment.

The Shop, Distributive and Allied Employees Association today said Wesfarmers’ underpayment announcement came as “a direct result of requests from the SDA last November that it and dozens of other firms in the retail sector audit their payrolls in light of Woolworths’ admission of underpayments to its staff”.

SDA national secretary Gerard Dwyer said many companies including Target had engaged the union in the audit, but others had not.

“Where are the powers to enforce lawful wages inside those companies that refuse to undertake a payroll audit?” Dwyer said.

“The fact is that a decade ago there were few instances of systemic underpayment when unions had the right to conduct spot checks of company payrolls.

All the recent examples of underpayment have emerged since the coalition government changed the law.”

Dwyer said it was not good enough for companies to claim award complexity was the issue.

“They have no trouble calculating how little tax they should pay down to the cent. It should be just as easy for them to pay their workers what they have earned,” he said.

-with AAP

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