The underpayment of sub-contracted cleaners at major supermarket chains in Tasmania has been described as “horrendous” by Liberal and Labor senators at a hearing in Devonport today.
The hearings were sparked after a Fair Work Ombudsman’s investigation into sub-contract cleaners in Tasmania.
The investigation began in 2014 in response to reports the ombudsman received that supermarket cleaners in Tasmania were being significantly underpaid.
The inquiry looked at contracting arrangements for cleaners at all the state’s 31 Woolworths stores, seven Coles stores and 17 IGA stores.
It found 90 per cent of Woolworths’s stores were in breach of industrial awards and that 84 per cent of records relating to the cleaning workforce were inaccurate or false.
Sub-contracted cleaners revealed they were paid as little as $7 an hour.
The Fair Work Ombudsman said the finding represented “serious exploitation” of workers and “abysmal” record keeping.
“Our inquiry found deficiencies in Woolworths’s governance arrangements with regard to its procurement and oversight of cleaning contracts, resulting in serious exploitation occurring at multiple levels of its cleaning supply chain,” they said.
Cleaners were often paid in unrecorded cash-in-hand payments with no payslips provided.
“Overall, record-keeping by contractors engaged at Woolworths’s sites was abysmal,” the ombudsman said.
The inquiry has so far identified more than $64,000 in underpayments, with more than $21,000 now rectified.
‘We apologise profusely’
Woolworths executives apologised for failing to ensure cleaning contractors paid workers properly.
“It’s deeply regrettable … and we apologise profusely,” Woolworths public policy manager Cameron Sinclair told the hearing.
But Labor senator Doug Cameron and Liberal senator Eric Abetz both slammed Woolworths over the findings as being “horrendous”.
“Your process failed them?” Senator Cameron asked Mr Sinclair.
“Senator, that may be the case,” Mr Sinclair replied.
“The past circumstances surrounding our cleaning contractors in Tasmania have been deeply regrettable.
“We fully acknowledge and unreservedly apologise for the shortcomings identified by the Fair Work Ombudsman in 2014.”
‘You’ve had problems since 2009 and you’ve done nothing’
Senator Abetz said evidence of the failure “speaks for itself”.
And Senator Cameron was caustic.
“You don’t have a clue with what’s been happening in your stores,” he said.
“You’ve had problems since 2009 and you’ve done nothing.
“The fact that these low-paid, vulnerable workers are being ripped off for the little they earn is disgraceful.
“Woolworths recently posted a 38 per cent increase in its half-yearly profits to almost $1 billion yet the people cleaning its stores are being systematically ripped off.”
Woolworths is the only supermarket in Tasmania that outsources its cleaners.
The ombudsman said Woolworths was still morally and ethically responsible for how cleaners were treated.
Workers struggled to pay for their medication
Wendy Hand, who worked as a cleaner for 15 years and gave evidence at the hearing, said colleagues of hers struggled with being underpaid and working unpaid overtime.
“A mother has taken her toaster to Cash Converters to actually pawn that so she can buy formula for her baby,” she told the ABC.
“I’ve had incidents where people can’t afford to get their medication because they are not paid.
“It’s ridiculous. We’re living in 21st century Australia, for goodness sake.”
Woolworths has said it would ensure cleaners were paid any missing wages, and is still using contractors to clean it stores.