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Nine ancillary firms have entered into an enforceable undertaking after underpaying more than 3,400 employees.
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Wesfarmers’ subsidiaries to back pay over $4.8m
07 February 2023
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Seven current and two former subsidiaries of Wesfarmers Industrial and Safety Pty Ltd (WIS) must back pay more than $4.8 million to over 3,400 employees after entering into an enforceable undertaking with the Fair Work Ombudsman (FWO).
The seven current entities found to have underpaid employees were J. Blackwood & Son Pty Ltd, Protector Alsafe Pty Ltd, Bullivants Pty Ltd, The Workwear Group Pty Ltd, Coregas Pty Ltd, Blacksmith Jacks Pty Ltd, Lawvale Pty Ltd, while the two now former WIS subsidiaries were Greencap Pty Ltd and Trimevac Pty Ltd.
As part of the enforceable undertaking, the firms must back-pay the underpaid employees $4,836,036 plus $246,779, as well as the total interest of $1,476,827 by February 2023.
The FWO said the individual underpayments were up to $38,362 while the average underpayment was $1,392.
The ombudsman investigated the subsidiaries after WIS reported an underpayment issue to it in October 2019 concerning oddities while implementing a new payroll system across the corporate group.
The broader review found payroll system errors adopted by WIS meant more than 3,400 current and former full-time, part-time and casual employees had been underpaid by the WIS entities between January 2010 and June 2020.
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The entitlements underpaid included base and overtime penalty rates, annual leave and casual loadings, vehicle allowance, and termination payments.
The enforceable undertaking also meant each WIS entity had to make a $100,000 contrition payment to the Commonwealth’s Consolidated Revenue Fund, as well as display notices that apologise for the contraventions across Facebook pages, public websites and intranets.
Fair Work Ombudsman Sandra Parker said an enforceable undertaking was the appropriate action to take as the WIS entities had demonstrated a commitment to rectifying the underpayments and changing their practises.
“Under the enforceable undertaking, the WIS entities have committed to implementing stringent measures to improve compliance and protect the rights of its workforce,” she said.
“These measures include commissioning, at the companies’ own cost, independent annual audit checks to check their compliance with workplace laws during the next two years.”
“This matter demonstrates how important it is for employers to identify and fix non-compliance in their processes, including the continued use of out-of-date and unsupported software systems and the incorrect interpretation and creation of pay rules.”
The underpaid workers were located throughout the country including, Melbourne, Sydney, Wollongong, Newcastle, Mackay, Canberra, Perth and Darwin while they worked across several different roles including retail and customer service, laboratory technology, transport and logistics, and more.
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