Super Retail Group has admitted to underpaying staff by another $8million – after previously revealing it owed workers $53.2million in back payments.
The announcement comes as the company’s first-half net profit fell by 20 per cent to $57.4million, despite modest revenue growth in the face of drought and bushfires.
Revenue for the company, which owns Rebel Sport, Supercheap Auto, BCF, and Macpac, climbed by 2.9 per cent to $1.44billion.
The group has updated its total estimate for team member back payments from $53.2million as at December 2018 to $61.2million as at December 28, 2019, excluding execution costs.
The estimate increase of $8million since December 2018 has resulted in a $9.5million after-tax expense in the half.
Super Retail Group, which owns Rebel Sport, Supercheap Auto, BCF, and Macpac, has updated its total estimate for team member back payments from $53.2million to $61.2million
The Queensland-based company said total costs to execute the remediation including the prior period were $8.6 million after tax.
‘The total amount of retail manager and set-up team member underpayments is lower than initially estimated,’ they said in a statement.
Super Retail Group said it had identified additional team members also impacted by overtime underpayments.
On the impacts of the coronavirus, the company said while a ‘significant proportion’ of the group’s products were sourced from China, only two factories were utilised in Wuhan, the Hubei province city at the epicentre of the outbreak
‘There is no expectation of a material impact on availability of product in the short term given current inventory levels,’ it told the ASX on Thursday.
‘The Group will continue to monitor ongoing developments in China and undertake appropriate contingency planning.’
Chief executive Anthony Heraghty said following the ‘extraordinary weather events’ of the summer, he was now seeing positive trends in the business, with sales momentum improving in Supercheap Auto, Rebel, and Macpac.
Supermarket giant Coles admitted to underpaying 1,150 workers over six years
Wesfarmers announced on Wednesday that workers at Target were stiffed out of $9million in wages
Super Retail Group announced an interim dividend of 21.5 cents per share, fully franked, in line with a year ago.
The company is the latest to be caught up in an apparent wage scandal in Australia – joining a growing list of retailers and businesses including Coles, Wesfarmers and Woolworths who listed payroll errors in their half-year results.
It was revealed in October that Woolworths underpaid its employees by as much as $300million over almost a decade, while the ABC, Qantas, Super Retail Group, Michael Hill Jewellers, Commonwealth Bank, Bunnings, Rockpool Dining Group, Sunglass Hut, 7-Eleven and George Calombaris’ hospitality group MAdE have also admitted wage underpayment.
On Wednesday, Wesfarmers identified in its results for the six months to December 31 a $9million payroll remediation for Target and a $15million remediation in its industrial and safety division.
Wesfarmers also admitted it had discovered underpayments at Bunnings and its industrial businesses
‘Following the payroll errors previously identified, Wesfarmers’ businesses have conducted extensive reviews of their respective payroll systems and processes,’ the company said in its release to the ASX.
‘As a result of these reviews, some additional payroll errors have been identified.’
Chief executive Rob Scott said ‘immediate steps’ were being taken to rectify the situation and repay affected staff members.
On Tuesday, Coles announced it was expecting a $20million hit after managers at its supermarkets and liquor division were underpaid over the past six years.
The cause of the underpayment, reportedly affecting 1,150 workers, was due to discrepancies between their remuneration and the General Retail Industry Award (GRIA).
Coles boss Steven Cain issued an apology to affected staff team and said it will remediate any ‘differences in full.’