Underpayment scandal continues: Target short-changed staff $9 million

Target staff have also been underpaid. Images: Getty

Target underpaid staff $9 million, parent company Wesfarmers announced in its half-year earnings presentation on Wednesday morning.

That’s in addition to a $15 million underpayment in Wesfarmers’ industrial and safety division, bringing the company’s payroll breach to $24 million.

The revelation comes less than a day after supermarket chain Coles made a similar admission. It underpaid some salaried staff across its supermarket and liquor brands around $20 million.

Wesfarmers said it discovered the Target payroll errors after finding similar underpayments at hardware retailer Bunnings last year. 

Target has set aside a $9 million provision to cover remediation. 

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

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

"Immediate steps are being taken to rectify identified issues, notify and repay affected team members, including interest, and ensure accuracy in the future through a robust program of auditing and monitoring,” Wesfarmers’ managing director Rob Scott.

Coles was formerly owned by Wesfarmers until it demerged in November 2018. The supermarket on Tuesday announced it had underpaid 1 per cent of its staff at least $20 million.  

Wesfarmers’ results announcement

Wesfarmers posted a net profit from continuing operations of $1.14 billion for the six months to 31 December 2019, up 6.0 per cent over the year.

Net profit fell to $1.21 billion from $4.54 billion a year ago, when the company was high on the Coles’ demerger funds.

‘Get your house in order’

Attorney-General Christina Porter. Image: Getty

Attorney-General Christian Porter on Tuesday warned corporate Australia has an “endemic” wage theft problem.

Porter is currently mulling tougher penalties for underpaying bosses which could see them receive up to 10 years in jail.

“Get your house in order,” he said on Tuesday.

“We’ve had large organisations that involve themselves in any number of social issues that spend an enormous amount of time, money and effort self-promoting with PR campaigns and national advertising telling us how good they are.

“Pay your people properly.”

Porter said these businesses are sophisticated enough to understand the required rates of pay, but said there is more to be done to pull businesses into line.

  • With AAP.

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