High-profile wage scandals have been uncovered recently in industries such as farming, manufacturing and hospitality and at convenience store chain 7-Eleven. In a scathing rebuke to Woolworths management, Fair Work Ombudsman Natalie James said the Australian public was tired of big businesses claiming they were unaware of exploitation by their contractors and subcontractors. "There were cases where the underpayment of workers was inevitable, with the insufficient money being paid by Woolworths for all the contractors to make a profit while meeting their employees' entitlements," she said. "You see no evil when you hold your hands over your eyes." The 12-month investigation, which audited 130 Woolworths supermarkets, was undertaken in light of disturbing allegations of violence towards trolley collectors at some Woolworths sites and a failure to lift compliance standards, according to the ombudsman.

At the time of the investigation, the minimum adult hourly rate for trolley workers was between $18 and $22.50 an hour, depending on whether they were full-time, part-time or casual staff. Rates of pay were found to be below the legal minimums at 34 per cent of Woolworths sites audited. Some of the other disturbing findings uncovered in the investigation included cash payments being used to cover up the illegality and inaccurate and misleading pay slips. It also found Woolworths' anti-exploitation measures to be ineffective and had "contributed to a culture of non-compliance by its contractors". Many of the trolley collectors were foreign workers from India, Sudan, Korea, Lebanon, Syria and Iraq and Iran, and were vulnerable to coercion and exploitation, the report said.

The release of the investigation report follows the launch of legal action against some Woolworths' contractors over the alleged exploitation of trolley workers and cleaning staff at supermarkets New South Wales and Tasmania. The Fair Work Ombudsman said it reserved the right to prosecute Woolworths for any involvement in any workplace violations that come to light. "We are recommending Woolworths enter into a compliance partnership with us to publicly demonstrate its commitment to stamping out the exploitation of vulnerable trolley collectors," the ombudsman said in a statement. A Woolworths spokeswoman said the company had actively co-operated with the Fair Work Ombudsman and would continue to do so to ensure trolley workers were treated fairly and ethically. "Woolworths believes that if the FWO were to conduct an inquiry into trolley collection procurement practices as they exist today our arrangements would not be open to criticisms of the kind levelled in the FWO's report," she said.

"Since 2014 Woolworths has put in place significant additional governance arrangements to help ensure compliance by its trolley collection contractors with workplace laws." The spokeswoman said improvements included independent audits, forums educating contractors on pay and conditions, requirements for statutory declarations from trolley company operators confirming compliance with industrial laws, and an exploitation hotline. "Woolworths takes all matters raised by the FWO seriously and has a zero-tolerance approach to all non-compliance with workplace law," she said.