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Woolworths comes under fire over underpayments and supply chain issues at AGM

Woolworths’ board faced a barrage of questions from shareholders and workers about the $300 million underpayments scandal and the retailer’s supply chain practices at the 2019 AGM on Monday.

In relation to the underpayments scandal, Woolworths chairman Gordon Cairns said the retail group has discovered the issue also impacts other parts of the business albeit “not to the same extent as the supermarket business”. However Cairns expects the total figure for underpayments to be at the lower end of the $200-300 million estimate reported in October.

The supermarket giant is defending itself against an employee class action which accuses it of substantially underestimating the scale of the underpayment bill.

Carins said the retailer is “making good progress” on repaying workers for underpayments from the last two years before Christmas and will have this completed by Monday December 23.

Last month Cairns and CEO Brad Banducci accepted responsibility for the salary blunder, with Banducci forgoing his A$2.6 million bonus and Cairns taking a 20 per cent cut to his A$790,531 board fee.

Supply chain issues dominate AGM

Members of the United Workers Union (UWU) grilled the board over issues including alleged labour exploitation and abuse in the horticulture supply chain.

The union is calling on the supermarket giant to sign an agreement that protects the rights of farm workers in their supply chain.

“We have presented Woolworths with solutions to these problems but they have not been taken up,” said Jannette Armstrong, farms director of United Workers Union.

“As extensive media coverage has highlighted in recent months, the issue of wage theft in particular is rife in Woolworths—from farm workers in the fields through to retail staff in the stores.”

A number of issues were highlighted in the horticulture supply chain as well as low wages for Big W workers in Bangladesh. The retailer said it is “actively working on introducinga living wage” for Big W supply chain workers.

Woolworths chairman Gordon Cairns said the retail group is “clearly not doing enough” and pleaded with workers to report suppliers who are not meeting Woolworths’ standards.

The UWU raised similar issues at the Coles AGM last month, with workers calling for the eradication of modern slavery in the retailer’s supply chain.

A shareholder vote on the proposed restructure of Endeavour Group will take place at an EGM following the AGM on Monday.

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