Australia’s Coles to take $17 million provision to compensate underpaid staff

(Reuters) – Australian No. 2 supermarket chain Coles Group (OTC:) Ltd said on Friday it would take an additional provision of A$25 million ($16.96 million) to compensate underpaid salaried employees.

Coles said in a statement that it intends to conduct a further remediation on the available records of days and hours of work of its salaried supermarket managers.

The grocer has been under the country’s industrial relations watchdog radar since February 2020, when investigations on the company’s pay arrangements for its salaried employees first started.

In late 2021, the Fair Work Ombudsman (FWO) sued Coles for underpaying more than 7,000 employees between January 2017 and March 2020.

According to the FWO, underpayments ranged from insufficient annual salaries to cover for the overtime work done by its workers and amounts under the remediation programme.

Coles’ update comes a day after mining giant BHP Group (NYSE:) said it had underpaid nearly 29,000 of its Australian workers for leave and other entitlements over a 13-year period which it estimated would cost it $280 million before tax to fix.

Coles, which is also facing a separate class action lawsuit related to the underpayment issues, apologized to the affected team members and said it is awaiting the court’s decision on the lawsuits.

($1 = 1.4743 Australian dollars)