Retailer owes $ 2m back pay

RETAILERS across the nation have been warned to make sure they’re paying staff properly after cosmetics business Lush admitted it owed 5000 staff as much as $ 2 million.

Lush Australia director Peta Granger said audits were ongoing but it was known staff had been underpaid since 2010 due to incorrect interpretations of the retail award.

Some employees are owed up to $ 10,000.

The retailer, which employs about 700 people, said the primary issue was its reliance on manual pay processes. Lush’s pay office had not paid overtime when part- time staff worked an extra day and was failing to pay extra when staff did not get a 12- hour break between shifts.

“We should have had far more respect for our people’s pay and upgraded our payroll infrastructure,” Ms Granger said.

The National Retail Association said it was “absolutely likely” more retailers were underpaying staff. Chief executive Dominique Lamb said pay rates, terms of references and classifications in modern awards changed frequently.

Payroll education body the Australian Payroll Association said it was not surprised another major company had underpaid staff because the pay office was underqualified, uninformed and undersupervised. “Employers need to take responsibility for their payroll departments,” chief executive Tracy Angwin said.