Australia Markets open in 9 hrs 56 mins

Sunglass Hut underpaid 620 staff $2.3 million

Pictured: Sunglass Hut logo and Australian $50 notes in envelope. Images: Getty, Sunglass Hut
Sunglass Hut has agreed to pay 620 workers $2.3 million. Images: Getty, Sunglass Hut

Current and former workers at 253 Sunglass Hut stores across Australia will receive letters of apology and back-payments after the eyewear retailer revealed it had underpaid 620 staff-members.

A total $2.3 million will be back-paid to 620 part-time workers employed between 2010 and 2016. Those workers did not receive overtime rates for work done outside of regular hours, the Fair Work Ombudsman said today.

The payments range from $4 to $42,912, with Sunglass Hut having already paid 457 staff $1.5 million.

The company will also make a $50,000 payment to the National Association of Community Legal Centres, and pay for external auditors to check pay and worker conditions until 2022, when the Enforceable Undertaking with the Fair Work Ombudsman expires.

“Sunglass Hut breached workplace laws and their conduct falls short of lawful obligations to their employees, and community expectations,” Fair Work Ombudsman Sandra Parker said.

“This matter highlights that if employers incorrectly apply award conditions, it can have extensive and expensive consequences across the business for years to come.

“This outcome should also serve as a warning to all businesses that they need to actively check that they are paying their staff correctly,” she added.

The underpayment occurred after Sunglass Hut failed to agree in writing with part-time workers on a regular pattern of hours and days.

“Sunglass Hut acknowledges that it made inadvertent errors in recording the regular pattern of

hours of certain of its former and current part-time retail employees,” Sunglass Hut owner Luxottica Retail Australia writes in the Enforceable Undertaking, admitting that this led to breaches of the Fair Work Act.

“Sunglass Hut has expressed its sincere regret for the errors and has apologised to affected employees.”

10 years’ jail for wage theft on the table

Sunglass Hut’s failure comes as the government considers how best to penalise employers who steal from their employees in the form of wage underpayment.

Last week, industrial relations minister Christian Porter released a discussion paper on the topic, with 10 year’ jail a possible outcome.

“These new criminal penalties should rightly apply only to the most serious types of offending where there is clear evidence of persistent or repeat offending, or offending on a significant scale," he said.

"We recognise that the industrial relations system is complex and we need to ensure that any new penalty regime is fit for purpose and avoids any unintended consequences.

"For example, we do not want employers who make genuine mistakes and move swiftly to rectify them to end up with a criminal record."

Yahoo Finance’s All Markets Summit is on the 26th of September 2019 at the Shangri-La, Sydney. Check out the full line-up of speakers and agenda for this groundbreaking event here.