Coles to back pay workers $1.5m in long service leave

Supermarket giant Coles will repay over $1.5 million in unpaid long service leave entitlements to 10,500 past and present workers.

Coles has been caught up in a debacle, resulting in it having to repay 10,500 of both its current and previous employees after an investigation by NSW Industrial Relations.

The NSW agency, in conjunction with the Fair Work Ombudsman (FWO), was alerted to the potential contraventions as Coles self-reported payroll issues. As a result of the investigation, Coles has agreed to repay over $1.5 million in unpaid long service leave entitlements, having audited 10,698 employees, which amounts to 6,346 current workers and 4,352 former workers.

Cole’s underpayment occurred as a result of a failure to correctly calculate ordinary pay correctly. This was due to a number of factors, including not taking into consideration allowances and bonuses. From this, the supermarket retailer has recalculated and back paid employees while also making changes to its payroll processes to ensure similar issues do not occur.

Although these underpayments were drastic in nature, Coles displayed a commitment to remedying the situation, as was seen by the self-report. This was an act that was applauded by Chris Minns’ NSW government.

“I would like to acknowledge Coles’ commitment to ensuring they pay long service leave correctly,” said Minister for Industrial Relations Sophie Cotsis.

“The NSW government is committed to ensuring workers receive their correct entitlements.

“This outcome is a reminder to employers, big and small, to make sure they are following the rules and that they can proactively self-report non-compliance to NSW Industrial Relations.

Furthermore, Coles has also agreed to invest in its payroll system to comply with the NSW Industrial Relations’ prescribed methodology, another act of ensuring accurate ongoing compliance occurs.

Back in May, supermarket rival Woolworths was in the headlines for similar contraventions. Woolies was slapped with a $1.2 million fine after failing to pay Victorian employees their correct long service leave entitlements.

This was described as a “systematic and widespread” failure by the supermarket giant. Yet, similar to Coles, Woolworths apologised to the affected employees and put a process in place to pay them back with interest and pleaded guilty at the earliest opportunity.