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McDonald’s owes NZ workers $42 million after payroll blunder

McDonalds underpaid NZ workers $42 million. Source: Getty

Around 60,000 McDonalds workers in New Zealand are set to get a boost to their wallets after the fast food giant failed to pay their annual leave entitlements.

Staff were short-changed their entitlements for over a decade, which amounted to almost NZ$45 million (AU$42 million), Unite Union national director Mike Treen stated.

"If the cost to McDonald's is at least $500 a year per worker, which I think it is, then the amount of money they will need to pay back is in the order of $45 million,” Treen said at the union’s AGM. 

“And I think that that may be just a base-line figure – it may well be more than that," he added.

McDonalds is one of hundreds of organisations in New Zealand which failed to pay out annual leave entitlements after the amendment to the Holidays Act in 2003 caused entitlements to be miscalculated nationwide.

The NZ government estimates around 760,000 people could have been underpaid almost NZ$2 billion in total as a result of the payroll errors.

"In some sectors the numbers are truly staggering – the health boards estimate they owe their staff $650 million," Treen said.

"New Zealand Post has put aside $38 million for their remediation. And it's money that should be paid back to all workers."

Australian companies have also failed to keep payments to staff in check. 

Last month, Woolworths admitted it underpaid 5,700 staff working in its supermarkets by almost $300 million.

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