Woolworths CEO cuts bonus pay after company shortchanged staff

Woolworths CEO cuts bonus pay after company shortchanged staff

Two key leadership figures at Woolworths Group (ASX: WOW) have decided to give their pay packages a haircut in the wake of the retailer's staff underpayment scandal last month.

A review from Australia's biggest retail chain found 5,700 of its employees had been underpaid to the tune of $300 million since 2010.

The Fair Work Ombudsman (FWO) Sandra Parker expressed shock at the findings, noting an investigation would take place and Woolworths would be held to account for breaching workplace laws.

"Lately, we are seeing a disturbing number of large corporates publicly admitting that they have underpaid their staff," Parker said.

Today Woolworths CEO Brad Banducci and chairman Gordon Cairns acknowledged their leadership responsibility for the payment shortfalls.

"I have made the personal decision to forgo my F20 short-term bonus because I believe it is the right thing for me to do as CEO," says Banducci, whose target short-term bonus for F20 was $2.6 million.

Banducci earned $12.6 million in FY19 including a $6.9 million of long term incentive (LTI) bonus. His target remuneration had been $7.9 million and the board had laid out a maximum remuneration target of $11 million, which he exceeded.

As of September, Banducci's family trust held 195,808 shares in Woolworths, worth around $7.67 million today.

Cairns opted to cut his board fee by 20 per cent from last year's $670,000.

"I accept that, as the chairman of the board, I have a higher level of responsibility than my board colleagues, and therefore have decided to take a 20 per cent reduction in my Board fee for F20," he said.

Both leaders admitted the board had let their salaried team members down.

"And our priority right now is to ensure that they receive the money they are owed as quickly as possible," Banducci and Cairns said.

"Our goal remains to finalise a full review of this issue by the end of the financial year. Once this is finalised, further consequences will be considered by the Board.

"Woolworths Group will provide further updates at the Group's Half Year F20 results in February."

Never miss a news update, subscribe here. Follow us on Facebook, LinkedIn, Instagram and Twitter.

Business News Australia

 

Get our daily business news

Sign up to our free email news updates.

 
Whitefox Recruitment founder Luke Hemmings making strides as a careers leader
Partner Content
After relocating his Canberra-founded company Whitefox Recruitment to the Gold Coast la...
Whitefox Recruitment
Advertisement

Related Stories

ASIC secures its first court win for greenwashing against US giant Vanguard

ASIC secures its first court win for greenwashing against US giant Vanguard

The Australian corporate watchdog has caught out one of the world&r...

Medicinal cannabis group Althea shaves $1.5m from its cost base through staff cutbacks

Medicinal cannabis group Althea shaves $1.5m from its cost base through staff cutbacks

Australian-founded medicinal cannabis company Althea Group (ASX: AG...

Charter Hall snares 15pc stake in Hotel Property Investments for $97m from 360 Capital

Charter Hall snares 15pc stake in Hotel Property Investments for $97m from 360 Capital

Listed funds manager 360 Capital Group (ASX: TGP) has offloaded its...

Lendlease gains approval for $1.7b transformation of Queen Victoria Market precinct

Lendlease gains approval for $1.7b transformation of Queen Victoria Market precinct

Australian development giant Lendlease Group (ASX: LLC) has been gr...