Supermarket giant Coles has agreed to fork-out more than $200,000 in back-pay for ten trolley collectors, conceding its employment practices were vulnerable to exploitation and underpayment.
The Fair Work Ombudsman commenced legal proceedings after raising concerns with Coles in late 2011 that trolley workers were being underpaid by sub-contractors at a number of Coles sites.
Inspectors were concerned after finding some collectors were being paid as little as $5 an hour for often physically demanding and dangerous work.
Proceedings against two subcontractors formally commenced in 2012 with Coles being named as a respondent. The FWO alleged that Coles knew trolley collectors were not being paid correct minimum wages.
The proceedings have now been discontinued after Coles agreed to back-pay the trolley collectors nearly $221,000 and signed-up to an enforceable undertaking to revamp its trolley collection services.
As part of the undertaking Coles must also establish a $500,000 fund to go towards back-pay for any other trolley collectors found to have been underpaid.
Deputy Fair Work Ombudsman (Operations), Michael Campbell, announced the discontinuance of the case and hoped Coles’ actions would set an example for others to follow.
“Taxpayers should not have to foot the bill for ensuring compliance by major companies like Coles, so it is pleasing that the company has agreed to accept this responsibility and take immediate action,” he said.
Fair Work Ombudsman Natalie James signalled to supermarket giants in August that they would be held accountable for poor employment practices that led to an erosion of workplace conditions. She said that sub-contracting arrangements would be examined.
Coles has since acknowledged that its model was “vulnerable to the exploitation and underpayment of employees of trolley collection contractors and sub-contractors”.
the supermarket giant has now brought trolley collection services “in-house” at more than 400 stores and this practice will be extended to all supermarkets in Australia within the next 24 months.
In addition, a “hot-line” has been set up at the head office for store managers to manage complaints from trolley collectors about wages and conditions.
Over the next two years, Coles will also audit the wages of at least 20 per cent of trolley collectors employed by more than 60 sub-contractors of its primary collection service provider, United Trolley Collections (UTC).
