Jewellery retailer Michael Hill admits to underpaying staff up to $25 million

Michael Hill store front. (Source: Getty)
Michael Hill store front. (Source: Getty)

International jewellery chain Michael Hill has announced it will back-pay underpaid staff between $10 million to $25 million after a review of its employment contracts revealed several years of non-compliance with the retail industry award rate.

The review, which was set in motion by Michael Hill’s relatively new CEO Daniel Bracken and completed by PwC, revealed “historic misapplication of the Award” across a number of Australian-based staff members over the last six years, the company said in a statement to the ASX.

According to the Fair Work Commission, the General Retail Industry Award 2010 stipulates the minimum wage for a retail employee to range between $813.60 and $995.50.

The jewellery retailer employs around 2,600 employees across 312 stores in Australia, New Zealand and Canada, the company’s 2018 annual report reveals.

Michael Hill has announced it will undertake another, more detailed review of all employee records, as well as rostering practices and payments.

“We will move as quickly as possible to rectify any under-payments with those team members affected,” said Bracken.

But given the “volume of data to work with and the complexity of the issues”, the review is expected to take another several months.

“I will be in contact with all team members today to apologise on behalf of the company and to provide an outline of the process we are following to establish who is impacted,” Bracken said.

The international jewellery chain said the remediation would be “one-off cost” that is somewhere between $10 million and $25 million.

Michael Hill doesn’t expect the remediation to hit its earnings of the company, however.

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