This week Woolworths confirmed that Findley’s client was one of three who had alerted it to an underpayment scandal that could affect nearly 6000 of its employees and cost as much as $300 million in back pay. Loading On Wednesday, chief executive Brad Banducci owned up, clearly hoping to make the best of yet another wage underpayment scandal. "We apologise to our team, we're going to make it right, but it's a very complex issue," Banducci announced. But tracking through what’s happened between this one Melbourne employee and Woolworths over the past eight months casts doubt on the company’s public positioning. The workplace watchdog, the Fair Work Ombudsman has questions to answer too. This story is one about how tough it is for an employee to get redress when they claim they are being underpaid.

'It's the law' As Findley went through his friend’s employment contract last February he found that Woolworths was misrepresenting the truth to their employee. They had told him that, as a salaried worker, he was not covered by an award or agreement. This is not true. The General Retail Industry Award covered him. Many managers are paid an annualised salary but this is not a blank cheque for an employer to suppress wages. The retail award sets a legal minimum rate that employers must pay at or above - even for salaried staff. It’s a simple enough proposition. It’s the law. But it has caught out a conga-line of high profile restaurateurs and now one of Australia’s biggest employers, their human resources department, and even their expert legal firm. My client is quite shocked you offered him nothing for working 80.4 hours of free overtime. Employee consultant Joshua Findlay The man worked from 7pm to 4am most days, including weekends. This entitled him to shift loadings. He was also entitled to allowances he was not receiving such as laundry allowance, cold area allowance, meal breaks and, crucially, overtime. As a shift worker, he was also entitled to an extra week’s annual leave.

Findley calculated that if his client accepted Woolworths’ $70,000 offer, he would be doing himself out of $8065 per year. And in a few months time when the award pay rate stepped up but this employee’s salary remained the same, this would balloon to $10,797. On February 20, the employee reported all this to his store manager in outer suburban Melbourne and raised a dispute. Then not much happened. A fortnight later, on March 8, Findley wrote saying: “You continue to underpay [my client]. Each day [he] presents to work, the contraventions continue … To be clear, this problem is not going to go away if you (or Woolworths) ignore it.” A month later, Woolworths acted. They increased Findley’s client’s base salary to $78,500, and on April 5 they gave him $24,254 in backpay. But they did not pay the overtime. A threat and an apparent inducement On the same day, Findley was sent two letters from Woolworths’ Head of Workplace Relations, Hayley Baxendale. The first threatened to report Findley “to the appropriate authorities” for trespass after he had visited a number of stores during the overnight shifts to talk to team managers about their conditions. The letter said he had misrepresented himself as a union official.

Even though Findley was one of the people credited with alerting Woolworths to the problem, a spokesman complained this week that he “did not identify any other specific team members who might be affected”. Woolworths had threatened action against him for trying to contact other “specific team members”. The second letter sent to Findley on April 5 proposed a “Confidential Release”. This was a legal agreement that offered his client $3000 on the condition he make no further claims and that he agree not to tell anyone - including his colleagues or the Fair Work Ombudsman - about the agreement. Woolworths has revealed it underpaid nearly 6000 employees as much as $300 million. Credit:AAP The man did not sign. Instead, Findley notified Woolworths that, beyond his own client’s case, “many other salaried employees are being underpaid in the same way”. He suggested that individual executives could be liable under the legislation for this wrongdoing. At this point Woolworths brought in the lawyers and Findley brought in the Fair Work Ombudsman - or tried to. On June 6, he received a letter from employment specialist Ashurst, refusing to pay his client’s overtime claim because his client’s annualised salary meant he was “not separately entitled to overtime”.

“My client,” Findley replied, “is quite shocked you offered him nothing for working 80.4 hours of free overtime.” It took several more letters, and inching concessions from Ashurst over two months, for Woolworths to pay the full overtime entitlement of about $8000. They denied this was an admission of wrongdoing. A series of underpayment scandals have rocked the hospitality industry, including George Calombaris and Neil Perry. Credit:Fairfax Media Findley is relentless and Woolworths is not the first big company he has taken on. In a recent case involving security company MSS, the Federal Court stayed his claim on the basis it was “an abuse of process” and noted he had used inflammatory language and had apologised after “improperly” accusing members of the Fair Work Commission of corruption. With Woolworths, ultimately, his work won big for his client, and helped bring to the surface what could be one of Australia’s biggest underpayments. “They delayed everything and threatened me,” Findley said. “It’s been an awful experience, but I’ve been lucky because my client, my friend, has no fear.”

'A lack of flexibility' This week, Fair Work Ombudsman Sandra Parker was also “shocked” that “yet another large, publicly listed company has today admitted to breaching Australia’s workplace laws on a massive scale”. She said Woolworths had not notified her office of the underpayment until late August. Loading But Findley’s complaint to the Ombudsman was filed on June 13, in which he warned of "systemic underpayments" that Woolworths had admitted in writing. In a follow-up letter four days later he said his store visits showed "some managers were being underpaid significantly more" than his client. The Fair Work Ombudsman said they received 450,000 inquiries every year. They had tried to reach Findley via phone and email three times in late June and had not had a response until October - after Woolworths had alerted them to the issue. Findley disputes this timeline and says he never received an email.

A spokeswoman for the Ombudsman added that they had only learned about "the scale of Woolworths underpayment and extent of non-compliance through the media". Woolworths is one of Australia’s biggest single employers. Asked how it could have got this fundamental issue wrong, chief executive Banducci blamed the complexity of Australia’s workplace laws. “At the right time, we'd like to come back and talk about the lack of flexibility in [awards] when interpreted literally," he said. Big business lobby group the Business Council of Australia echoed the sentiment. But this is not the first time Woolworths have been caught in a major pay scandal. This week’s events flows directly from an even broader underpayment scandal that engulfed the retail and fast food sectors from 2015 onwards. For years the biggest companies in Australia including Coles, Woolworths McDonald’s and KFC had got away with paying more than half their workforce below the award under deals struck with the Shop, Distributive & Allied Employees Association. It's estimated more than 250,000 workers were underpaid billions. In 2015-16, a deal involving Coles was challenged by activists and exposed by The Age and Herald. Since then the whole sector - including Woolworths - have been forced to renegotiate enterprise agreements.

Loading Woolworths implemented that new agreement in February, which gave a big boost to the wages of night-fill staff who were receiving penalty rates for the first time. As Banducci explained on Wednesday, department managers suddenly noticed in February, after the new enterprise agreement was implemented, that “some of the team that worked for them had a higher take home pay than they did.” The correction of a previous pay scandal led directly to the exposure of a new one.