News National Garry Linnell: Wage theft excuses don’t pass the pub test

Garry Linnell: Wage theft excuses don’t pass the pub test

Garry Linnell won't accept the "lame excuses" dished out by companies who underpay their staff. Photo: TND
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The Court of Public Opinion is now in session.

Would the defendants please rise.

In the matter of The People versus Companies That Have Grossly Underpaid Their Staff, it is alleged the defendants have withheld hundreds of millions of dollars in salary entitlements.

It is also alleged the defendants, who are among the highest-paid executives in this country, have provided this court with an extraordinary list of lame excuses for why this gross underpayment took place.

Last week we heard the chief executives of two of Australia’s biggest retail employers – Wesfarmers and Super Retail Group – blame computer software problems for a series of underpayments to staff totalling close to $100 million.

A couple of months ago we were told by supermarket giant Woolworths that 5700 of its employees may have been underpaid close to $300 million because of “an inconsistency” in calculations relating to an old enterprise bargaining agreement.

We have heard from the ABC it has set aside $23 million for close to 2000 casual workers because of an “error” in the public broadcaster’s pay system.

The Commonwealth Bank claims “errors” in payroll systems led to more than $50 million being withheld from worker’s pay cheques.

Michael Hill Jewellers have said a “non-compliance” issue had short changed staff by as much as $25 million, while George Calombaris’ restaurant empire claimed that “incorrect processes and failures within its payroll and human resources functions” resulted in more than 500 staff being underpaid almost $8 million.

There are dozens of these “inconsistencies”, vaguely-attributed “errors” and “non-compliance” issues.

This Court is of the view that these are nothing more than weasel words and junk phrases devised by highly paid teams of spin consultants to cover up systemic incompetence.

This Court is firm in its belief that underpaying staff is another form of theft, due to negligence and an appalling absence of employee welfare.

It beggars belief that companies of such enormous scale and profitability like Wesfarmers, Woolworths and Commonwealth Bank – all of which have invested hundreds of millions of dollars in advanced computer systems – can blame this scandalous state of affairs on “errors of calculation”.

Or that they have allowed such oversights to fester for so long.

Commonwealth Bank will repay 8000 workers a combined $4.8 million. Photo: AAP

We note with great interest that none of these remarkable examples of underpayment occurred at senior management or board level.

This Court can only wonder just how quickly these problems would have been rectified had various managing directors suddenly found themselves short of coin.

Last week Wesfarmers chief executive Rob Scott stated that harsh punishments such as jail time should not be handed out to businesses that simply experienced “inadvertent administrative errors”.

He said this after the federal government raised the idea of criminalising serious examples of worker exploitation as part of a wider overhaul of workplace laws.

Mr Scott, who oversees a business empire that includes Bunnings, Target, Kmart and Officeworks, had the temerity to suggest “the reputation of businesses and future actions should be determined by how (businesses) respond to the issue once it has been identified”.

No, Mr Scott. That is not how a good reputation is earned.

It comes about by ensuring you are doing the right thing in the first place, that due diligence is implemented from the beginning, and that a company of your size has a genuine concern for its workers.

You also had the nerve to say that when Wesfarmers uncovers cases of staff being overpaid, the company “takes it on the chin… we don’t seek to claw that back from people”.

A similar statement was made by the chief executive of Super Retail Group, Anthony Heraghty, whose company, the parent of retail businesses Rebel Sport and Super Cheap Auto, has identified underpayments of up to $60 million over the past eight years.

super retail unpaid wages
Super Retail Group, owner of the Rebel Sport chain, owes staff $32 million in unpaid overtime. Photo: AAP

Mr Heraghty said that if an individual case of overpayment was discovered, “we never ever drag it back”.

How noble.

Would these two gentlemen please provide this court with documentation showing how many of their employees have been overpaid?

Does the total amount compare to the tens of millions of dollars these companies have ripped off their hard-working employees?

No, what we have here is not just a series of computer errors, miscalculations or “failures in human resource systems”, but an appalling disregard for workers and their families.

This Court of Public Opinion has always fully supported businesses in their pursuit of profit.

But the lame excuses offered by an extraordinary list of companies in this wage theft scandal suggests many of them have cut costs – and corners – in sections of their company responsible for employee welfare.

That, by anyone’s definition, is negligence and incompetency on a breathtaking scale.

This Court finds the defendants guilty.

It sentences every chief executive and board member of the offending companies to significantly underpay themselves for the next few years.

The reasons for this underpayment will be acknowledged as a “computer or system error”.

This Court of Public Opinion is confident such a penalty will ensure that underpayment of staff will never happen again.

Garry Linnell was director of News and Current Affairs for the Nine network in the mid-2000s. He has also been editorial director for Fairfax and is a former editor of The Daily Telegraph and The Bulletin magazine

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