Woolworths accused of underpaying $1 million in long service leave

Wednesday, 2 August 2023 at 2:00 am

Wage Inspectorate Victoria has filed over 1,000 charges in the Magistrates’ Court of Victoria against Woolworths Group Limited and its subsidiary Woolstar Pty. Limited, alleging they failed to pay over $1 million in long service leave to 1,235 former employees, with alleged underpayments ranging from $250 to over $12,000. 

It is alleged that between 2018 and 2021, Woolworths Group contravened section 9(2) of Victoria’s Long Service Leave Act 2018 by failing to pay more than $960,000 in long service leave entitlements to 1,199 former employees. 

During the same period, Woolstar Pty. Limited is alleged to have also contravened section 9(2) by failing to pay more than $45,000 in long service leave entitlements to 36 former employees. 

The maximum penalty for each offence by a body corporate is 60 penalty units for each day during which the offences continue ($9,671.40 from July 2018 to June 2019, $9,913.20 from July 2019 to June 2021 and $10,904.40 from July 2021 to June 2022).

The matter is listed for mention in the Melbourne Magistrates’ Court on 6 September 2023. 

In addition to the matter against Woolworths and Woolstar, the Wage Inspectorate has cases against Optus, CommSec and BankWest before the court alleging breaches of Victoria’s long service leave laws.

In 2021, a Wage Inspectorate investigation found over 4,000 former Coles workers in Victoria were underpaid almost $700,000 in long service leave entitlements. 

The Wage Inspectorate will not provide further details while the matter is before the court.

Quotes attributable to Robert Hortle, Commissioner of Wage Inspectorate Victoria

“Victorians expect businesses with significant payroll resources to get this stuff right. They’d be disappointed to see a household name facing underpayment allegations.”

“Long service leave is a long standing, valued workplace entitlement in Victoria, and the Wage Inspectorate is here to ensure it is paid when it is owed.”

“The amount of underpayment never tells the full story in long service leave matters. It's hard to put a value on the leave workers were initially denied. Time that could have been spent with family, travelling or just relaxing.”

Background on Victoria’s Long Service Leave Act

The Long Service Leave Act 2018 is a Victorian law that provides long service leave for employees who have worked continuously with one employer for at least 7 years. It applies to work that is:

  • full time
  • part time
  • casual
  • seasonal
  • fixed term.

After at least 7 years’ continuous employment with one employer, an employee is entitled to take their long service leave and be paid any unused long service leave entitlement when their employment ends. 

Most Victorian employees will be covered by and entitled to long service leave in accordance with the Act, unless they have a long service leave entitlement from another source, such as under other legislation, a registered agreement, award or another law.