🗞️Woolworths Group Fined $1.263 Million for Long Service Leave Underpayments

A woman carrying a grocery basket of vegetables picks up a Boxed Water box

The Melbourne Magistrates' Court found Woolworths Group Limited and its subsidiary Woolstar Pty. Limited guilty of failing to provide more than a thousand employees with over $1 million in long service leave, leading to a total fine of $1.263 million without finding them guilty. Investigative work by Wage Inspectorate Victoria, which upholds the state's long service leave regulations, led to the prosecution. Following its guilty plea, Woolworths Group was fined $1.227 million for neglecting to reimburse 1,191 former workers for over $960,000 in unpaid long service leave, which was due between November 1, 2018, and January 29, 2023. After admitting guilt and paying over $45,000 in unpaid long service leave entitlements to 36 former employees between 1 November 2018 and 18 December 2022, Woolstar Pty. Limited was fined $36,000. The proceedings of today concerned underpayments ranging from $1,000 to $12,000. Her Honour Magistrate Nahrain Warda stated during sentencing that Woolworths' widespread and systemic payroll failures were the cause of the underpayments. As one of Australia's biggest employers, operating across state lines, Her Honour stated that Woolworths ought to be expected to have reliable payroll systems in place. The numerous detrimental knock-on effects that underpayment of long service leave may have on the victims were also mentioned by Her Honour. Her Honour said that while Woolworth's self-reporting, guilty plea, and cooperation with the Wage Inspectorate's investigation were mitigating factors, the number of victims and the extent of the underpayment were aggravating factors in the sentencing process. If Woolworths hadn't entered an early guilty plea, her Honour would have found them guilty and fined them $2.1 million, while Woolstar would have been fined $80,000. Woolworths was also mandated to cover costs, totalling $15,000. This is the second time a large supermarket has been prosecuted by the Wage Inspectorate for violating long service leave policies. Coles was ordered to pay $15,000 in costs and a $50,000 fine in 2021 for underpaying nearly $700,000 in entitlements. Robert Hortle, Victoria's Commissioner of Wage Inspectorate said through its investigation, Wage Inspectorate Victoria has ensured that over $1 million has found its way back into the hands of hardworking Victorians, where it rightfully should have been all along.

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He said "The whole picture isn't revealed by even such a staggering financial amount. Staff members missed the chance to travel, spend time with family, or rejuvenate themselves because long service leave was improperly computed, leaving them unaware of their complete leave entitlement.

"Mistakes amounted to as much as $12,000, which, when based on the minimum wage, is comparable to more than 500 hours or 67 days off."

Woolworths underpays its employees to such a great degree, which is disappointing given its substantial resources. Large corporations are expected by Victorians to handle this stuff correctly.

"It's loyal, long-serving staff who are affected; each of these employees had to have worked for Woolworths for at least seven years to be eligible for long service leave."

"The court and the Wage Inspectorate take serious offences to underpayment of entitlements, and today's sentence should serve as a warning to businesses throughout the state, especially large, well-resourced corporations. There are serious penalties for violating long service leave laws."

Background

Employees who have worked continuously for one employer for at least seven years are eligible for long service leave under the Long Service Leave Act 2018, a Victorian law. Work that is full-time, part-time, casual, seasonal, and fixed-term are all covered. An employee can take their long service leave and get paid for any unused leave on their last day of work if they have worked for their current employer for at least seven years. Unless they are entitled to long service leave under another law, registered agreement, award, or other arrangement, the majority of Victorian employees will be covered by the Act. The Wage Inspectorate's most serious compliance tool is a prosecution, and decisions to file a lawsuit are made in accordance with its Compliance and Enforcement Policy.

Meanwhile, NTEU members at FedUni held an all-member meeting this week and pledged to protest the Vice Chancellor's devastating “Future Fed” cuts proposal at the university's three major campuses next week. Staff, students, and community members will rally at midday at Berwick, Churchill, and Mt Helen campuses on Tuesday, April 30, Wednesday, May 1, and Thursday, May 2. They will urge senior management to stop the Vice Chancellor's devastating cuts, which will eliminate valuable courses and further strain student support services. Management has confirmed that they will cut 200 Full Time Equivalent positions, but they have not disclosed where. This represents nearly 20% of FedUni's 1071 FTEs in the last annual report. No Australian university management has made more destructive cuts, according to the NTEU.

“Our Branch’s organising team has been very busy putting up posters, handing out leaflets, and engaging staff and students in conversations to build these important rallies,” said NTEU Branch President Dr Mathew Abbott. 

“Our Branch has taken on this rogue management in the past and won and we are aiming to do so again. The stakes are very high as staff members believe our university cannot survive cuts of this scale, as they will make our problems with student enrolment and retention far worse.” 

FedUni student Ramesh Durai says students are very concerned about the cuts and about proposals from the university’s Provost to replace valued staff with chat bots.

“As a current international student, I would be greatly disappointed should the discussed changes, specifically those regarding the redundancy of staff and replacement with automated systems, be meted out,” said Mr Durai. 

“I would consider it a failing of the university to fulfill their contracted charge of proper tertiary education. If I wanted a chatbot handling my requests I would take that to Maccas, not my university.”

The locations of the rallies and information about speakers will be released on Monday April 29.

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