Woolworths underpayments bill tops $315m with warnings of more to come
Woolworths has upped its estimated staff underpayments to $315 million and says the final amount could still be higher once a review into the nine-year scandal is complete.
The supermarket giant — which also owns Big W — on Tuesday said it would exceed its initial guess of $200 million to $300 million in salaried staff underpayments potentially dating back to 2010, with a review having now covered five years of data.
The previous estimate, which identified at least 5700 affected team members, was based on two years worth of information.
Wednesday’s update comes after Woolworths told investors in December expected the bill from its wages underpayment scandal to come in at the lower end of the $200 million to $300 million range it first flagged in October, even as more cases came to light.
“The calculations of the salary payment shortfall involve a substantial volume of data, a high degree of complexity, interpretation, estimations, and are subject to further analysis of prior periods and the Fair Work Ombudsman’s ongoing investigation,” Woolies told the ASX on Wednesday.
The underpayments issue also weighed on the company’s first half profit result, which slipped 7.7 per cent to $887 million despite a 6 per cent increase in total revenue to $32.41 billion.
The result for the six months to December 31 was hurt by $51 million in one-off costs related to the Endeavour Drinks separation, and another $80 million for the underpayments review.
Total supermarket revenue increased 6.4 per cent to $21.2 billion.
The company will pay a fully franked interim dividend of 46¢ a share, up 1¢ on a year ago.