Chemist Warehouse back pays $3.5 million, signs Fair Work agreement

After back paying almost 6,000 of its workers more than $3.5 million, Chemist Warehouse has entered a compliance partnership with the Fair Work Ombudsman

The discount brand, which includes a network of 350 retail pharmacy businesses, was audited by the Fair Work Ombudsman following concerns raised over non-payment of wages for compulsory online training undertaken by staff outside of normal working hours.

While CW Retail Services Pty Ltd issued instructions to individual business owners saying that workers should be paid for compulsory training and it should be conducted during working hours, it acknowledged that there was potential for non-payment of training time to have erroneously occurred within businesses across the network.

Following a review of all online training, 294 stores operating under the Chemist Warehouse brand initiated back payment to 5,976 employees totalling $3,569,212.10.

CW Retail Services has now signed a Proactive Compliance Deed on behalf of the franchise network.

Fair Work Ombudsman Natalie James noted the preparedness of Chemist Warehouse to facilitate the swift rectification of the underpayments but warned that this example was a reminder that ‘set and forget’ instructions could be an issue.

“It’s important that employers pay workers for all the hours they dedicate to their work. If training is compulsory, then it is work. Young workers in particular are vulnerable to not realising this and giving their time for free,” James said.

“As part of its Deed with the Fair Work Ombudsman, Chemist Warehouse will establish systems and processes to ensure compliance, particularly relating to compulsory training and how it is conducted and recorded by all franchises.”

Under the Compliance Deed, Chemist Warehouse will also:

  • engage an independent auditor to assess compliance with workplace laws over the three years of the Deed;
  • implement workplace relations training for managers and staff in all Chemist Warehouse stores;
  • nominate a dedicated person to deal with requests for assistance from staff at Chemist Warehouse franchises which are referred by the Fair Work Ombudsman; and
  • establish and maintain a dedicated telephone hotline and email service to ensure all employees may make enquiries or report potential non-compliance at Chemist Warehouse franchises.

James welcomed the undertaking by Chemist Warehouse and said such commitments by large and established brands helps the watchdog in its work to build a culture of compliance with workplace laws in Australia.

“Compliance partnerships are an initiative we have introduced for Australian companies who want to engage with us to demonstrate to their employees and the wider community that they take their workplace responsibilities seriously,” she said.

“Chemist Warehouse’s commitment to engaging cooperatively with the regulator to fix issues when they arise is to be commended.”

CW Retail Pty Ltd Director Damien Gance said: “Chemist Warehouse welcomes the opportunity to enter into this partnership with the FWO.

“Chemist Warehouse as a group knows how important our people are to our success, and we are committed to ensuring our people are paid properly for the great work they do.”

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