Mining giant BHP has admitted to the underpayment of almost 30,000 workers in Australia, dating back to 2010. It will cost more than $400 million to make things right, ABC News reports.
In a statement to the ASX, BHP said a review suggested rostered employees in Australia have had their leave incorrectly deducted on public holidays since 2010.
"There are approximately 28,500 affected current and former employees with an average of six leave days in total that have been incorrectly deducted from affected employees," the company told the ASX.
In addition, BHP reportedly said it has found around 400 current and former employees in Port Hedland are entitled to additional allowances "due to an error with the employment entity in their contract".
BHP has significant export infrastructure in Port Hedland, where iron ore from its Pilbara operation is shipped.
In February the company reported a half-year profit of $9.3 billion, a drop of 32 per cent.
BHP estimates the cost of fixing the underpayments issue will be around $US280 million pre-tax — which works out to be roughly $430 million.
The company reportedly told the ASX that it is continuing to investigate the matter and an update will be provided in its full-year results in August.
Falls short of standard
BHP's Australian president Geraldine Slattery apologised to employees affected by the errors. "This is not good enough and falls short of the standards we expect at BHP," she said.
"We are working to rectify and remediate these issues, with interest, as quickly as possible."
BHP said it has self-reported to the Fair Work Ombudsman and will contact current and former employees who have been affected.
In a video statement to employees, Ms Slattery reportedly said BHP had "discovered some issues" with the payroll system which affected employees.
"Let me call out a few things, this should not be happening at all," she said.
"I'm deeply sorry that you're being impacted."
"Please know we're committed to understanding and correcting these issues quickly."
The BHP president said the issues had been reported to the Fair Work Ombudsman and former employees who may have been affected would be contacted.
BHP's chief people officer Jad Vodopija stated that a preliminary review showed leave had been incorrectly deducted when some employees had taken time off work on a public holiday.
She said leave hours that had been incorrectly deducted would be re-credited, plus 10 per cent, as a recognition that "this never should've happened".
Ms Vodopija said those employed by copper and gold miner OZ Minerals before it was bought by BHP in April may have also been affected.
"Our initial investigation suggests OZ Minerals has been affected by a similar issue before being acquired by BHP," she said.
"We are committed to fixing this also."
Responses
Grahame Kelly - Mining and Energy Union general secretary - said BHP had been "sprung ripping workers off" and the union would ensure affected members received their full entitlements.
The Mining and Energy Union was reportedly critical of the company following news of the massive payment shortfall.
"Today's revelation goes to show that we need to keep up the pressure on big companies like BHP to do the right thing," Mr Kelly said.
"BHP has assumed that because they want round-the-clock profits from their mining operations, their workers aren't entitled to their public holiday rights.
"We will make sure all our affected members receive every cent they are owed due to this stuff-up."
Tony Burke - Workplace Relations Minister - was also critical after news of the underpayments broke.
"Just last week BHP were trying to assure us that their employment practices were impeccable and the government didn't need to close any loopholes to protect wages," Mr Burke said.
"That's clearly not true.
"Australia can do better to make sure workers are properly paid. That'll be the focus of our legislation in the coming months."
Source: ABC News
(Quotes via original reporting)
Mining giant BHP has admitted to the underpayment of almost 30,000 workers in Australia, dating back to 2010. It will cost more than $400 million to make things right, ABC News reports.
In a statement to the ASX, BHP said a review suggested rostered employees in Australia have had their leave incorrectly deducted on public holidays since 2010.
"There are approximately 28,500 affected current and former employees with an average of six leave days in total that have been incorrectly deducted from affected employees," the company told the ASX.
In addition, BHP reportedly said it has found around 400 current and former employees in Port Hedland are entitled to additional allowances "due to an error with the employment entity in their contract".
BHP has significant export infrastructure in Port Hedland, where iron ore from its Pilbara operation is shipped.
In February the company reported a half-year profit of $9.3 billion, a drop of 32 per cent.
BHP estimates the cost of fixing the underpayments issue will be around $US280 million pre-tax — which works out to be roughly $430 million.
The company reportedly told the ASX that it is continuing to investigate the matter and an update will be provided in its full-year results in August.
Falls short of standard
BHP's Australian president Geraldine Slattery apologised to employees affected by the errors. "This is not good enough and falls short of the standards we expect at BHP," she said.
"We are working to rectify and remediate these issues, with interest, as quickly as possible."
BHP said it has self-reported to the Fair Work Ombudsman and will contact current and former employees who have been affected.
In a video statement to employees, Ms Slattery reportedly said BHP had "discovered some issues" with the payroll system which affected employees.
"Let me call out a few things, this should not be happening at all," she said.
"I'm deeply sorry that you're being impacted."
"Please know we're committed to understanding and correcting these issues quickly."
The BHP president said the issues had been reported to the Fair Work Ombudsman and former employees who may have been affected would be contacted.
BHP's chief people officer Jad Vodopija stated that a preliminary review showed leave had been incorrectly deducted when some employees had taken time off work on a public holiday.
She said leave hours that had been incorrectly deducted would be re-credited, plus 10 per cent, as a recognition that "this never should've happened".
Ms Vodopija said those employed by copper and gold miner OZ Minerals before it was bought by BHP in April may have also been affected.
"Our initial investigation suggests OZ Minerals has been affected by a similar issue before being acquired by BHP," she said.
"We are committed to fixing this also."
Responses
Grahame Kelly - Mining and Energy Union general secretary - said BHP had been "sprung ripping workers off" and the union would ensure affected members received their full entitlements.
The Mining and Energy Union was reportedly critical of the company following news of the massive payment shortfall.
"Today's revelation goes to show that we need to keep up the pressure on big companies like BHP to do the right thing," Mr Kelly said.
"BHP has assumed that because they want round-the-clock profits from their mining operations, their workers aren't entitled to their public holiday rights.
"We will make sure all our affected members receive every cent they are owed due to this stuff-up."
Tony Burke - Workplace Relations Minister - was also critical after news of the underpayments broke.
"Just last week BHP were trying to assure us that their employment practices were impeccable and the government didn't need to close any loopholes to protect wages," Mr Burke said.
"That's clearly not true.
"Australia can do better to make sure workers are properly paid. That'll be the focus of our legislation in the coming months."
Source: ABC News
(Quotes via original reporting)