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Target employees were underpaid $9 million, as Wesfarmers reveals yet another wage scandal on its books

Jack Derwin
·2-min read
  • Target has become the latest company to admit underpaying staff, with parent company Wesfarmers revealing on Wednesday it skimped on $9 million.

  • It comes just a day after Coles, which was controlled by Wesfarmers until late last year, admitted it had underpaid managers $20 million over six years.

  • Bunnings, another Wesfarmers' icon, had to pay back $6 million late last year in missing super to 40,000 employees.

  • Visit Business Insider Australia’s homepage for more stories.

Another day, another wage theft scandal.

Target will be forced to pay back at least $9 million to employees after it discovered an issue with its payroll, parent company Wesfarmers Group revealed on Wednesday.

"The Group's first-half results include the impact of the estimated payroll remediation costs and associated expenses," Wesfarmers said in a report issued to the Australian Securities Exchange (ASX), acknowledging the payout and Target's otherwise poor performance.

"Excluding this one-off cost, earnings were 7.6% below the prior corresponding period," Wesfarmers said, blaming declining sales on reduced clothes spending.

The development is just the latest bad news for Wesfarmers, one of Australia's largest companies, which owns and manages some of its most recognisable retail brands including Officeworks and Kmart Group. It comes just one day after it was revealed Coles, which it only spun off last year and in which it still retains a stake, had shortchanged managers $20 million across its supermarket and bottle store operations in the last six years. A further 40,000 workers at Bunnings, another Wesfarmers darling, were paid back $6 million in missing superannuation late last year.

Those revelations emerged after the group announced a company-wide payroll review in October. It may also not be the last of its brands that may be in the wrong. The AFR has reported Officeworks is currently in the midst of its own review and suggest it may be the next to remediate staff.

That's not to suggest Wesfarmers has any worse a track record than any other major company in Australia at this stage. Wage scandals have recently plagued the likes of the Commonwealth Bank, Sunglass Hut, Dominos, Subway, Qantas, Lush, the ABC, a string of high-profile celebrity chefs including George Calombaris' Made Establishment, Woolworths and many, many more.

It's been enough to prompt the Attorney-General's Department to propose harsh new penalties to deter wage theft, including jail time, million-dollar fines and public naming and shaming.

Whether those measures will be enough to crack Australian employers into shape is another matter entirely.