Dick Smith Underpaid Its Workers for up to Six Years, Say Receivers

teasatotalling on 05/02/2016 - 09:55

The troubled electrical retailer Dick Smith has been underpaying workers for as long as six years, according to the firm of receivers restructuring the company.

Ferrier Hodgson said on Thursday it had discovered that as many as 3,200 current and former employees had been underpaid their annual leave loading entitlements, possibly dating back to 2010.

The incorrect application of the relevant industrial award is estimated to have added another $2m to Dick Smith’s outstanding liabilities.

The administrator, McGrathNicol, told a creditors’ meeting last month it had estimated employee liabilities of about $15m, which included long-service leave and accrued holiday pay but not any potential redundancy payments.

There could be further ugly discoveries to come, with Ferrier Hodgson still trawling the Dick Smith accounts and reviewing other historical entitlement calculations to make sure they have been correctly paid….
http://www.theguardian.com/business/2016/feb/04/dick-smith-u…

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Comments

  • James1976 on 05/02/2016 - 10:16
    +10

    ..and they still couldn't turn a profit. They should have spoken to 7-11 for some advice on how to really underpay staff

  • bluedufflecoat on 05/02/2016 - 10:36
    +3

    If it dates back to 2010, shouldn't the previous owners be held accountable? Both Woolworths and the Private Equity group?

    • mskeggs on 05/02/2016 - 18:13

      Depends. The private equity buyer probably agreed to take over all outstanding liabilities, and then probably had the same release when they sold at IPO.

      • bluedufflecoat on 05/02/2016 - 19:09

        Can you sign away breaking the law?

  • orza on 05/02/2016 - 12:50
    +2

    No wonder they were all reselling clearance stock on eBay!

  • eatwell365 on 05/02/2016 - 13:00

    Oh…bonus from heaven if staff can get the money back.

    besides probably selling clearance stocks themselves to f&f or on eBay.

  • bamzero on 06/02/2016 - 19:31
    +2

    Dick Smith Underpaid Its Workers for up to Six Years, Shortfall to be paid in Dick Smith Gift Cards, Say Receivers.

  • tonka on 07/02/2016 - 05:06
    +1

    I'd bet there are many many other companies the same. Employers hate annual leave loading, ex-pat employers/managers despise it. So they write up a policy or individual contract that excludes it.

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