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Announced today, Suncorp’s (ASX: SUN) insurance arm has forked out about $32 million to more than 15,800 underpaid staff after revealing it failed to adequately pay employees the minimum wage since 2014.
The payback includes interest and superannuation, including about $26 million in wages and entitlements, $4.5 million in interest, and $1.4 million in superannuation.
Suncorp has entered into an enforceable undertaking (EU) - a written agreement with the Fair Work Ombudsman - due to the unethical workplace infringement of underpayments that occurred between May 2014 and March 2022.
Under the EU, Suncorp must make a $520,000 contrition payment and adhere to obligations with the ombudsman.
Fair Work Ombudsman Sandra Parker said Suncorp had cooperated and demonstrated a strong commitment to rectifying underpayments.
“Suncorp has committed to stringent measures to ensure its employee are paid correctly in the future. These measures include engaging, at the company’s own cost, two independent annual audits to assess its compliance with workplace laws,” Parker said.
“This matter demonstrates the importance of employers placing a high priority on compliance, including with all clauses in their enterprise agreements. Suncorp’s incorrect application of particular clauses has led to underpayment of basic employee entitlements and a large back-payment bill.
“Any employer who needs help should contact the Fair Work Ombudsman for free advice,” she added.
Suncorp says the underpayments occurred due to the inconsistent use of ‘rostered employee’ and misunderstandings of appropriate entitlements under a self-service process.
The company first identified underpayments after commencing an internal review into specific pay and leave practices and its rostering systems.
The underpayments include overtime, shift loadings, weekend penalties, annual leave loading, public holiday loadings, minimum rate of pay, long service leave, redundancy, payment in lieu of notice, meal allowances and superannuation.
Individual payments range from $1 to $54,951, with an average underpayment of $1,687 per impacted employee.
The current and former employees who were underpaid worked nationwide in a range of roles in the insurance arm of the three companies, including as advisors, assessors, customer support staff, technical staff, team leaders and managers.
This comes after supermarket giant Coles coughed up an additional $25 million to rectify underpaid wages, blowing out the company’s total wage theft bill to $50 million.
Coles is now facing a class action over the issue, as well as separate legal action by the Fair Work Ombudsman in Federal Court.
BHP (ASX: BHP) also revealed it underpaid workers $430m since 2010.
The mining giant admitted almost 30,000 past and present employees have been underpaid by the company since 2010, and that it will cost an estimated $US280 million ($430 million) to rectify the problem.
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