Retailers across the country have been warned to make sure they’re paying staff properly after cosmetics business Lush admitted it owed 5000 staff as much as $2 million.
Lush Australia director Peta Granger says audits are ongoing but it’s known staff have been underpaid since 2010 due to incorrect interpretations of the retail award.
Some employees are owed up to $10,000 with predominantly part-time workers affected.
The retailer, which employs about 700 people, says the primary issue was its reliance on manual pay processes.
Lush’s pay office hadn’t paid overtime when part-time staff worked an extra day and was failing to pay extra when staff didn’t get a 12-hour break between shifts.
‘We should have had far more respect for our people’s pay and upgraded our payroll infrastructure to keep up with the growth of our business,’ Ms Granger said on Tuesday.
The National Retailers Association says it’s ‘absolutely likely’ many more retailers are underpaying staff.
NRA chief executive Dominique Lamb said pay rates, terms of references and classifications in modern awards can change frequently.
‘This is definitely the time to get it right,’ she said.
Payroll education body the Australian Payroll Association isn’t surprised another major company has underpaid staff because the pay office was underqualified, uninformed and under-supervised.
‘Employers need to take responsibility for their payroll departments – which they are not doing,’ chief executive Tracy Angwin said in a statement.