Shortcomings in payroll processes lead to payment problems: report
In a proactive move, Optus Retail is rectifying underpayments totaling over $7.8 million to 3,744 current and former employees, marking a commitment to fair compensation and compliance.
The telecommunications company discovered the underpayments through an internal review and self-reported the findings to the Fair Work Ombudsman in April 2021, according to InsideRetail.
The underpayment includes over $5.4 million in wages and entitlements, coupled with more than $2.4 million in superannuation and interest. The affected employees, hired as retail consultants and store managers across Australia between January 2014 and March 2020, are now receiving the owed amounts.
Shortcomings in payroll processes
The internal review revealed various shortcomings in Optus' payroll processes, according to InsideRetail. Failures to conduct annual reconciliations, resulting in employees being paid less under the enterprise agreement, and oversight in compensating retail consultants for work performed outside their rostered hours were among the identified issues.
Furthermore, part-time and casual employees were not paid for a minimum of three hours per shift. The higher classification and pay rate, warranted for retail consultants engaged in additional responsibilities such as opening and closing stores, were not consistently applied.
Optus also miscalculated mandated six-monthly reconciliations for employees in stores with extended trading hours.
‘Stringent measures’ to make sure workers paid correctly
Optus Retail has already completed the back payments for the majority of affected employees, said Inside Retail. Additionally, the company entered into an enforceable undertaking with the Fair Work Ombudsman, showcasing its commitment to corrective measures.
“Under the enforceable undertaking, Optus Retail has committed to putting in place stringent measures to ensure all its workers are paid correctly,” emphasized Fair Work Ombudsman Anna Booth.
These measures include a comprehensive review of employee entitlements from January 2020 to July 2023 and independent audits of future compliance with workplace laws over the next two years, said InsideRetail.
In adherence to the undertaking, Optus will make an initial contrition payment of $450,000 to the Commonwealth’s Consolidated Revenue Fund. Another contrition payment, equal to 4% of the total underpayments found in the next review, is mandated. Additionally, Optus must furnish proof of implemented systems and processes ensuring future compliance to the Fair Work Ombudsman.