Coles reveals underpayment irregularities. Picture: AAP Image/Joel Carrett
Coles reveals underpayment irregularities. Picture: AAP Image/Joel Carrett

Coles’ $20m bill for underpaying staff

Coles has become the latest Australian institution to be embroiled in a wage payment scandal, confirming it will set aside $20 million to cover the irregularities.

The supermarket giant launched an investigation after similar underpayments were revealed at its rival Woolworths as well as Bunnings, the Super Retail Group and iconic restaurant chains.

It released a statement this morning as it handed down its half-year profit results which said it will set aside $20 million to cover the payment discrepancies from a six-year period.

Coles chief executive Steven Cain apologised to those impacted by the scandal, which related to a small group of salaried team members given a wage below the industry reward.

"We are working at pace with a team of external experts to finalise our review," he said in a statement.

"Once completed we will contact all affected team members, both current and former, to remediate any identified differences in full.

"Coles has implemented steps to improve our systems and processes."

The review into the payment irregularities discovered about 5 per cent of salaried team members at the company's supermarket and liquor division had been underpaid.

Those covered by the enterprise agreement, however, were not ripped off by the giant retailer, which accounts for about 90 per cent of its workforce.

The revelation comes as the company reported retail earnings of $725 million, confirming its earlier predictions that a strong Christmas period underpinned a vastly improved second-quarter performance.

More to come