Finance Work Car dealership chain admits millions in staff underpayment

Car dealership chain admits millions in staff underpayment

ap eagers wage theft
The country's biggest car dealer is the latest business to admit to underpaying thousands of current and former workers. Photo: Getty
Twitter Facebook Reddit Pinterest Email

Car dealership chain AP Eagers is the latest Australian company forced to reimburse and apologise to employees it has underpaid millions of dollars.

Australia’s biggest car dealer revealed on Tuesday it owed 6200 present and former employees a total of $4.5 million.

The underpayments were from a seven-year period and due to “inconsistencies” across award classifications, overtime, superannuation contributions and deductions, the company said.

AP Eagers said it had noted the issues while centralising its payroll systems. They had previously been managed by individual dealerships, some of which were acquired by the company in recent years.

After identifying the problem, AP Eagers hired PwC to conduct an audit and then self-reported to the Fair Work Ombudsman.

It said the underpayments equated to just under 0.25 per cent of the $2.1 billion in wages it had paid in the seven years.

The company has also committed to review payments to employees of car dealer and finance business AHG, which it acquired in a $2.3 billion acquisition in September 2019.

“We unreservedly apologise to our employees,” AP Eagers chief executive Martin Ward said.

“AP Eagers is committed to paying the amounts owed to past and present employees, in full and with interest, as soon as practically possible.”

The company is the latest Australian entity to fall foul of workplace rules this year after wages issues were uncovered at Woolworths, Commonwealth Bank, Bunnings, Super Retail Group, Michael Hill Jeweller, and even the ABC, among others.

Woolworths – whose admitted wage theft incidents are one of the country’s largest – said on Monday the underpayments were bigger than first thought. Cases had been uncovered at the retail giant’s other businesses, including Dan Murphy’s and Big W, chairman Gordon Cairns told Woolworths’ annual meeting in Sydney.

The bill to remedy years of underpayment for nearly 6000 staff will be somewhere between $200 million-$300 million, he said.

Shares in AP Eagers dipped in early trade but climbed during the session to sit 2.56 per cent higher at $10.40 by 2pm (AEDT).

-with AAP

View Comments