Woolworths' chief executive Brad Banducci and chairman Gordon Cairns will have their pay packets docked for the 2020 financial year in response to the company's $300 million underpayment scandal.

The supermarket giant announced on Wednesday Mr Banducci would forgo his target short-term bonuses for the current financial year, a mixture of cash and vested shares totalling $2.6 million.

Woolworths CEO Brad Banducci will forgo his $2.6 million short-term bonus this year. Credit:Janie Barrett

Mr Cairns will reduce his fee by 20 per cent. Having earned $670,000 in directors fees in the past financial year, that could see him take home as much as $134,000 less this year.

In October, Woolworths revealed it had underpaid nearly 6000 of its salaried employees as much as $300 million over a 10-year period, due to inconsistencies between the company's enterprise agreement and the general retail award.