The impacts of Woolworths’ offshoring proposal

The supermarket chain plans to remove complexity, increase productivity, and drive efficiency through its proposal to offshore its corporate roles.

With reports that potentially hundreds of corporate roles at Woolworths may be offshored, impacting staff in finance, human resources, and IT, a spokesperson for the supermarket chain told HR Leader that this move comes as it focuses its attention on “removing complexity, increasing productivity and driving efficiency” within its business and to “remain competitive with the rapid expansion of international players”, in a “dynamic and competitive sector”.

Despite this, in its supermarkets inquiry final report published 21 March 2025, the Australian Competition and Consumer Commission (ACCC)found: “ALDI, Coles and Woolworths appear to be among the most profitable supermarket businesses globally.”

Swaab partner Michael Byrnes (pictured) called Woolworths’ movement of its corporate roles offshore “sobering” for those impacted; however, it is reflective of a “broader trend”. “Woolworths is by no means alone in implementing such a strategy,” he said.

This year, PwC announced that it would be basing nearly three in five of its executive assistants in Manila; Origin energy last year offshored roles; CBA was previously scrutinised by the Fair Work Commission over an alleged lack of transparency in its increase in offshoring after it denied that “any of [its] 283 jobs cut in June [2025] were being replaced overseas”; and Coca-Cola Europacific Partners early last year announced it would be shifting finance roles to its team in the Philippines.

“We have, for many years, had teams located throughout Asia and longstanding managed service arrangements in place. We regularly review these to ensure we are accessing the best global capabilities and lowering our costs, to ensure we are offering the best value for our customers,” the spokesperson said.

The spokesperson added that it will do this to continue its commitment to providing “dependable low prices” and better shopping experiences that its customers expect. “Our customers are telling us they need more help managing their budgets as growing inflationary pressures impact the cost of living,” the spokesperson said.

Last year, the supermarket chain announced its “cost-savings plan”, which included job cuts to reduce prices.

Potential impacts and takeaways

“Employers that offshore functions, leading to local redundancies, run the risk of damaging their employment brand,” Byrnes said.

“It can send a message that loyalty, diligence, and commitment to the employer may not be reciprocated or rewarded. From a broader branding perspective, it can also make any campaign relating to ‘buying Australian’ or ‘supporting Australia’ less credible or open to criticism.”

Byrnes emphasised that in this sort of offshoring strategy, employers need to comply with the major workplace change clause in the modern awards covering affected staff, stressing the importance of a genuine consultation, and that proposals presented with the aim to mitigate their impact must be considered.

He noted the proposals, such as offering affected staff the opportunity to be employed by the offshore service provider.

“Employers need to be very careful [when] offshoring functions that require an understanding of local laws and workplace cultural norms. This is a problem that particularly arises in HR. Overseas-based managers or practitioners sometimes do not have an appreciation of the applicable legislation and bring their own cultural perspectives to practical workplace issues that may be at odds with the reality of Australian employment law,” Byrnes said.

He noted the importance for employers to exercise caution in the way they employ or engage staff overseas directly as they may still be covered by the Fair Work Act, with recent cases such as Pascua v Doessel Group Pty Ltd and Sanderson v Brightest Australia Pty Ltd showing that if the contract of employment is formed in Australia with an Australian employer, the employee may be covered by the act, even if they are based and do their work overseas.

Byrnes noted that offshoring works best for process-driven tasks. “Once judgment needs to be exercised based on local conditions, significant problems can, and do, arise. Workplace investigations conducted by HR staff outside Australia are sometimes a disaster,” he said.

“Opposition to the strategy from staff does not mean it needs to be reversed. While a consultation process will need to be undertaken for award-covered staff, the ultimate decision to implement the strategy is within the management prerogative of the employer,” Byrnes said.

The supermarket chain consulted its corporate teams last week on plans to expand global capabilities and managed service partnerships, which are focused on corporate roles and do not involve store or distribution roles.

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Carlos Tse

Carlos Tse is a graduate journalist writing for Accountants Daily, HR Leader, Lawyers Weekly.