Poll: Is the award system too complex?
On Tuesday, Coles was at the centre of a $20 million underpayments scandal, and less than 24 hours later Target has admitted that it underpaid staff by $9 million.
The two retailers are the latest in a string of Australian companies to come clean about underpaying staff.
In October, Woolworths made headlines over a whopping $300 million underpayment, which lead to CEO Brad Banducci forgoing his $2.6 million bonus and chairman Gordon Cairns taking a 20 per cent cut to his board fee.
Last year, Wesfarmers revealed it had also underpaid staff at its hardware division, Bunnings, as well as Blackwoods, Workwear Group, Coregas and Greencap.
The award system appears to be a central problem in many underpayments of late and has been criticised by many for being too complex.
Tracy Angwin, CEO and founder of Australian Payroll Association and Director of Payroll HQ told Inside FMCG that while it is complex, the laws work well with people who are qualified to do the job.
“The main problem is that retailers tend to rely on systems and not people. Often, this means they are not investing in qualified payroll professionals. In fact, a recent report from the Australian Payroll Association found that most payroll staff are under-qualified, with just 10 per cent of payroll professionals across small and large organisations reported to have a competency-based payroll qualification,” Angwin said.
So why is there an epidemic of underpayments of late? And why are so many companies falling foul to the award system? Is there a lack of education, training or resources in these companies?
Let us know what you think.