Employment Disputes at Woolworths: A Fair Work Act 2009 Analysis

This report provides a comprehensive analysis of the employment disputes at Woolworths, a major Australian retail chain. It examines the context of the disputes, including allegations of underpayment and violations of the Fair Work Act 2009. The report details specific cases, such as the underpayment of a replenishment manager, and explores the types of employment disputes that arise, including unlawful terminations, wage disputes, and discrimination. It highlights the role of the Fair Work Act in addressing these issues and outlines the contentions made during the dispute, including claims of unpaid overtime, allowances, and unfair working conditions. The report also discusses the use of the Fair Work Act for settling claims and the outcomes of the disputes, including Woolworths' responses and the involvement of the Fair Work Ombudsman. Overall, the report provides a detailed overview of the employment relations issues at Woolworths, the legal frameworks involved, and the consequences of non-compliance.

Employment Disputes in Woolworths
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Introduction
Commercial organizations are entitled to pay fair wages to the employees that work hard for
the success of the firm. Companies hire workers and experienced personnel completing the
task of the firm. They pay for the services offered by the workers. The government has laid
several policies so that the workers are not exploited in terms of overwork and underpayment.
In spite of the government regulations, many firms tend to underpay the employee for saving
cost increasing their profit margins. It has been noticed that many retail firms are often
engaged in employment disputes so as to minimize their cost structure. In this regard, the
Woolworths supermarket in Australia has been challenged in the Federal Court for the
underpayment of many employees. In this report, the employment disputes of Woolworths
and the principles of the Fair work Act 2009 will be studied.
Employment disputes
About the company
Woolworths is a well known retail chain n Australia. It operates through 995 stores and
employs approximately 115,000 individuals in distribution centers, support services and other
divisions (Woolworth Group, 2020a). The company extracts fresh fruits and other
agricultural products directly from the farmers. This helps in cost reduction while also
providing fresh farm produce to its customers. it also claims that 100% of its owned products
are made from “RSPO certified palm oil”. the company also operates through its online
applications that save time and cost of the shoppers. The company also announced its
corporate social responsibility through which the firm distributed food to approximately
18.8million needy individuals. It has also donated an amount of $44.3 million to the different
communities in Australia (Woolworth Group, 2020b).
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The company maintains goodwill amongst its customers but fails to satisfy the demands of its
salaried employee. There have been many cases against the HR practices of Woolworth. In
2014, Woolworth had to pay $5000 to Steven Willmonth and gender discrimination during
the recruitment process (Stephens, 2014). In February 2019, the company was again accused
of underpayment and had to pay approximately $300 million to more than 6000 workers
(Carey, 2020). The company had paid below the retail industry standards to the majority of
its executives. This accusation of the company has been consistent for a prolonged time
period. Thus, the company has been violating the law related to workplace practices and
recruitment and several media report was published highlighting this matter.
Principles of Fair Work Act 2009
It is the legislation that provides rules for wage rate and equality at work. It aims in providing
a balanced outline for the workplace relationships that promote economic and social
prosperity in Australia. The act provides norms for least wage entitlements, stretchy working
conditions, promotion of equality while protection of the individuals against discrimination.
The legislation was amended on April 9, 2020, while supporting the execution and process of
“job keeper scheme” in workplaces in Australia. The primary object of this act is to provide a
relevant balanced framework for the purpose of incorporating productive and cooperative
relations such that social inclusion can be included. The laws of fair work enable better
workplace relations for Australians that are flexible for businesses. This supports economic
growth and productivity for the future of the economy and considers Australia's international
labor-related obligations. The Fair Work Act includes conditions of employment, thus stating
the privileges and responsibilities of workers, employers, and firms relative to organizations.
The legislation has guidelines for enforcing the Act in many organizations. The
administration of the Act is carried by Far Work Commissions and Fair Work Ombudsman.
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The Fair Work Ombudsman resolves issues relating to legislation include the Corporation
Act 2001, Independent Contractors Act 2006, Freedom of Information Act 1982 and many
others. The entitlements of the Act are enforced under the National Employment Standard
and national minimum wage awards.
Types of Employment Disputes
It is noticed that many of the large organizations exploit their managers and, low wage
earners for curtailing down their costs. In this regard, companies often underpay their
employees. The workers are overloaded with extra work hours but no sufficient
compensation and sometimes wages are deducted on sick leaves taken by the employee.
Every company has the pressure of maintaining its costs for enhanced profit margins and
thus, many of the employees suffer due to this (Guest, 2016). There are four common types
of disputes that the company is engaged in. Firstly, unlawful terminations by the employer. In
this scenario, the employee's work is put on trial and can be terminated under the no-contract
circumstance. On the contract basis of the work, the employer holds the responsibility of not
terminating services before the completion of the mentioned time period. Termination in the
contract basis job is only done in extreme cases of theft and integrity issues. On the contrary,
the non- contract offer letter often provides the employers, rights to terminate at their will.
Thus, in this scenario, the employee work is trail and dissatisfaction on the same can lead to
terminated services.
The companies head or the supervisor dismisses the employer due to personal grudge with
that particular employee (Buchanan and Huczynski, 2019). Secondly, in the case of the
underpayment of the employee. The companies are involved in wage disputes, if the worker
is not paid for their overtime, sick leaves promised incentives or paid below the industry
norms. Thirdly, discrimination and harassment may cause disputes to the companies. In this
scenario, the employee can claim compensation if they are harassed discriminated by the
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supervisors, managers on the basis of sex, caste, religion, and others. the laws provide
solutions to disabled employees if they are not allocated appropriate accommodations at the
workplace. Fourthly, employment disputes also arise due to severance agreements. In other
words, the worker can raise questions or lawsuits arising out of the non- disclosure
documents and the compensation that is provided after leaving the company. Thus, four types
of common employment disputes have discussed that drain the resources and time of the
employee as well as the employer.
Woolworth has been one of the largest retailers in Australia. The company sells groceries and
many other products at a low price. Thus, it has great pressure to curtail down the cost of
attracting a huge base. In this view, the firm has underpaid many of its employees and landed
in employment disputes under the Federal Law. The company in order to make profits has
been accused of reducing the pay of its employees and giving pay cuts several times. The
company was charged for compensation under the Fair Work Act 2009.
Case
The case occurred in February 2019, when the replenishment manager was a new
remuneration structure of $70,000 annually. The salary agreement of the previous year of the
manager was reviewed and found many compensations were not given by Woolworth. The
firm had paid the salary in alignment with The General Retail Industry Award that has set a
minimum wage for salaried employees. In simple words, the company did not pay for 80.4
hours worked by the manager. The employee had a work shift from 7 pm to 4 am in the
morning that included weekends. The employee has not been receiving meal breaks, laundry,
and cold area allowance and overtime dues. Such over dues by the company was given to the
young employee working from 6 years (Bachelard and Schneiders, 2019). The worker was
also entitled to receive extra leaves annually for every 7 days. Thus, the actual earnings
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(2019) of the employee would more than $8065 but was offered only$70000 this year. The
issue was reported to the store manager but essential steps were not taken.
The employment dispute of Woolworth had been published in “The Sydney Morning Herald”
Michael Bachelard and Ben Schneiders on November 1(2019). The dispute constituted a
replenishment manager and Woolworth. Employment consultant Joshua Findley had helped
the employee to fight against Woolworth for underpayment.
After, the scandal published in the media, Woolworth confirmed that the employee was one
the third to alert about the underpayment. The claims of the employee would impact 6000
workers requiring the company to pay back approximately $300 million to its workers. After
the media reports and claims by Findley, Woolworths raised the salary of the victim
employee to$78,500 while repaid $24,254 (Bachelard and Schneiders, 2019). The worker still
did not receive payments for working overtime. In due course of time, Woolworth threatened
Findley on two charges, one of which was the Findley should identify managers and
employees affected while the other letter projected “Confidential Release”. In the second
letter, the company was willing to offer $ 3000 million to the replenishment manager on the
condition that no further claims should be addressed while also maintaining confidentiality to
other staff and colleagues.
Furthermore, Findley claimed that other workers were also underpaid by the worker. After
the employee did not sign the "Confidential Release" lawyers were hired by Woolworths to
settle the claims meanwhile Findley approached Fair Work Ombudsman for justice to his
client. As there were several instances where the client did not adequately pay their workers.
Findley received a letter from the employer specialist of Woolworth claiming that overtime
dues could be settled as the employee is entitled to overtime pay as per the contract. Thus, the
replenishment manager had worked for a total of 80.4 hours in overtime, amounting to $8000
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due to Woolworth. Woolworth was charged under “Systematic underpayments” (Bachelard
and Schneiders, 2019). Findley found that many executives and managers in the store had
more compensation than his client. In recent times, the employees are due to overtime
payments. It is noticed that Woolworth revised pay to night shift workers which were higher
than the day workers.
After this media publication, in October 2019, it was investigated that Woolworth underpaid
6000 employees from nine years. The payback will raise the company cost up to $300 million
to $ 400m including interest and costs (Lanin, 2019). In other media reports of Dec 2019, it
was stated that Woolworth initiated payback to its employees and plans to forfeit a $20
million bonus by cutting down 20% from the salary paid to the directors (Lanin, 2019). The
suppliers, farmworkers also claimed underpayment from the company. Thus, it can be said
that Woolworth has been selfish in keeping profits while not paying its staff and third parties
as per promise.
Contentions made during Dispute
The client of Findley had received settlements on laundry allowance, cold area allowance and
others in compliance with the Fair Work Act 2009. The federation has laid principles for fair
practices at the workplace. Fair work Ombudsman will conduct an investigation for
Woolworth's violation of workplace laws. It is reported that Fair work Ombudsman has
recovered the amount of $80 million for 18000 workers that were underpaid. Findley charged
accused Woolworth in systematic underpayment for overtime working hours while also
deviating claims from promised allowances that include cold area and laundry. The
contentions including working conditions in which appropriate meal breaks were not given
during the night shifts of his client. It was claimed that wages given to his client were below
cover of award or agreement. It was also contended that the employee works in shift and is
entitled to extra leaves per annum but was not provided by the employer.
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Use of Fair Work Act for settling Claims
Fair work Act 2009 deals with the workplace practices in Australia ensuring all salaried and
other staff working in the companies should be paid under safety minimum entitlement. In
alignment with the Fair Work Act, 2009 and Fair Work Regulations 2009 flexible working
shifts, and equality at the workplace should be maintained by all the employers. Any
discrimination in the working area will lead to compensation and termination of license in
extreme conditions. In this case, the client of Findley was paid violating the minimum wage
set by the legislation (Fair Work Ombudsman, 2020a). There are 10 standards that laid under
Awards or Agreements out of which annual leave, personal leave, maximum working hours
in the week had been mentioned. The client of Findley was covered in The General Retail
Industry Award; thus, the compensation was received. Using the Vulnerable worker's Act
under Fair Work Act 2009, the employers (subsidiaries, franchisee or holding firms) can be
held liable for violating the industrial laws and the firms can be fined for underpayment and
late payments. It is necessary for all the employers and business units to register under the
Fair Worker Act that maintains the records of the compliances (Fair Work Ombudsman,
2020b).
Fair work Ombudsman has been investigating many retailers and fast-food chains that have
violated workplace laws in Australia.
Unsolved Disputes
The disputes are underway as the client of Findley is yet to receive overtime payments
worth$8000 for 80.6 hours. The Fair Work Act has contacted Findley many times but the
case is still pending. The employee and Findley can recover the money through a provision in
the Fair Work Act 2009. However, in the recent media reports, it is noted that the company is
repaying the employee the amount not paid. Thus, Woolworth did not abide by the Fair Work
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Act in performing its duties in an effective manner. Thus, it might be assumed that
Woolworth will not delay the overtime dues of Findley’s Client.
Woolworths was made aware several times that it had a problem. Though the brand’s CEO
Brad Banducci apologized for the underpayment of wages yet it refused to contract and
accept the dispute. Under the Fair Work's Act, the company was liable to provide equal
opportunity and pay to all its employees. But the company took the dispute, a long way to
address the issue of being underpaid. The Fair Work Ombudsman was also questioned in
regard to Woolworths non-payment of wages. The company repeatedly misrepresented the
truth to its employees. Under the norms of the Fair Wage Act, the company had to abide by
the legislations while functioning in Australia. Though this legislation applies across all
Australia's workplaces, its standards were suitably ignored by the company for its own
benefits.
Under the Act, the employer should maintain a pay record and working hours in seven years.
the payments should be paid monthly and the mode of payments should monetary. The
employee should be paid in alignment with the national minimum wage rate ($19.49 for July
2019). Under the Fair Work Practices 2009, the employer can be charged for neglecting
award salaries, superannuation, leave per annum, monthly paid leaves with a payslip. Thus,
Woolworth was charged against all the above-mentioned inclusions. In the case of the
violations, the employee can contact and submit written complaint Fair work Ombudsman
that will conduct an investigation by calculating payments received and entitled. The
legislation also investigates employers for compensation. The underpayments are termed as
“wage theft” by many politicians, industrialists to determine the failure of the employers in
paying sufficient wages to the employee.
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Recommendations
The workplace laws in Australia are strict and one of the best in the world. Fair Work Act
2009 underlays various sections through which the employee can claim the underpayments.
The case is still registered under Fair Work Ombudsman thus, timely participation of both the
parties and mutual settlements will solve the case. In this scenario, it was noticed that Fair
Work Ombudsman has sent emails and telephonic calls for settling the case from June to
October. Findley stated that no such emails or calls were received by him. Thus, non -
participation of the parties are delaying the case settlements. It is suggested that both parties
are equally responsible for case settlements thus be participate.
Woolworth is recommended to pay full settlements to its employees which is equivalent to
their hard work. Lawsuits and media publications destroy the brand image of the company,
thus, the firms should not indulge in any law violations. The media report often destroys
market existence and goodwill thus, profitable business can be conducted by complying with
law and workplace practices.
It is suggested to the employee that wage calculation should be frequently done after the
payment thus, any claims can be settled quickly. It becomes easier to calculate per month
wages than comparing the settlements from past years. This will save the time of Fair Work
Ombudsman and the employee will receive speedy redressal.
Conclusion
The employers of many retail organizations undertake strategies for curtailing the cost and
increasing the profit margins. In this scenario, the employee is underpaid thereby violating
minimum wage standards in the region. In this report, Woolworth has been analyzed for the
underpayment dispute by its employee. The report underlines major disputes of employment
between employees and employers, many of the claims have been settled but payment for
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overtime is still dues. After the media published the case, further investigation revealed that
$300million had to be compensated for 6000 employees. The claims have been settled under
the provisions of the Fair Work Act 2009.
Reference List
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April 2020].
Buchanan, D.A. and Huczynski, A.A., 2019. Organizational behavior. Pearson UK.
Carey, A., 2020. Woolworths owes workers at least $315 million amid profit drop. [online]
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<https://www.abc.net.au/news/2019-12-16/woolworths-agm-underpaid-staff-backpayments-
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