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Australian retailer Best & Less has been forced to back pay staff more than $5.2m after it was revealed workers were being incorrectly paid and not properly reimbursed for overtime, penalty and annual leave entitlements.

The underpayments, which were self-reported by the discount retailer in December 2020, affected 686 current and former store managers who worked at the company between 2013 and 2020.

The back payments ranged from $4 to $42,144, with staff owed an average of $7600. Altogether, the underpayments totalled $5.21m, plus nearly $500,000 in lost superannuation.

The staff, who were managers on a fixed salary, were found to have been paid rates that didn’t match the General Retail Industry Award 2010. The oversight affected workers across Australia in both regional and metropolitan stores.

A statement from the Fair Work Ombudsman (FWO) also said Best & Less failed to make and keep proper records of hours worked by store managers and assistant store managers.

The retail giant has also been slapped with an enforceable undertaking to ensure it pays back all the money owed by October. The company said it had already reimbursed a “large majority” of it.

The penalty also includes a $200,000 contrition payment to the Commonwealth’s Consolidated Revenue Fund and additional requirements to set up an inquiry hotline for employees and display the underpayment notice on Best & Less’ social media and website.

Acting Fair Work Ombudsman Kristen Hannah said this was a warning to employers to ensure they were meeting their workplace obligations.

“Insufficient salaries have become a persistent problem in many Australian workplaces,” she said.

“Employers need to be aware that employees must be paid at least the minimum entitlements that they are owed under the applicable industrial instrument, such as an award.

“Employers that take a ‘set-and-forget’ approach and fail to record and reconcile actual hours worked when paying salaries risk substantial back-pay bills to their hardworking staff.”

Best & Less operates 189 contracts across Australia and employs more than 4300 staff. At the time of publishing, the retailer holds a markets value of $235,062,994.

Best & Less were approached for comment.

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By Rahul

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