Australia's Woolworths faces proposed class action over underpaying staff

Credit: REUTERS/DAVID GRAY

Australia's biggest grocery chain Woolworths Group Ltd said on Monday that a class action lawsuit had been proposed against it for underpaying thousands of supermarket workers.

Adds details on lawsuit, background

Dec 2 (Reuters) - Australia's biggest grocery chain Woolworths Group Ltd WOW.AX said on Monday that a class action lawsuit had been proposed against it for underpaying thousands of supermarket workers.

The company said it would fully defend itself against the proceedings.

Canberra-based law firm Adero Law on its website said it filed the lawsuit on Friday on behalf of about 7,000 current and former supermarket employees.

Woolworths in October said it had underpaid thousands of supermarket workers for years and would need to repay as much as A$300 million ($203.58 million), becoming the most high-profile company to be caught up in wage scandals across corporate Australia.

Adero added that it "considers that the underpayments disclosed by Woolworths to date substantially understate the wages owed" which the law firm estimates at A$620 million.

Last week, the company said its Chief Executive Officer Brad Banducci would forgo his bonus following the scandal, while Chairman Gordon Cairns would take a 20% reduction in his board fee.

The underpayment of workers has emerged as a hot-button issue in Australia this year, and Woolworths' admission had prompted a government agency to say it would investigate the firm.

($1 = 1.4736 Australian dollars)

(Reporting by Niyati Shetty in Bengaluru; Editing by Daniel Wallis and Alistair Bell)

((Niyati.N.Shetty@thomsonreuters.com; +918067497199;))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

Reuters

Reuters, the news and media division of Thomson Reuters, is the world’s largest international multimedia news provider reaching more than one billion people every day. Reuters provides trusted business, financial, national, and international news to professionals via Thomson Reuters desktops, the world's media organizations, and directly to consumers at Reuters.com and via Reuters TV.

Learn More