Aldi Underpaying of Employees in Sydney Distribution Centre up to

The recent public decision concerning Aldi requesting its employees to effectively start early and not pay them properly is a timely reminder to businesses to ensure that you are paying your employees correctly to avoid the risk of being found guilty of wage theft. On 4 October 2022, the Fair Work commission found Aldi had been underpaying employees of at least four of its distribution centre.

The decision is based on activities deemed to be work, conducted by the employees in the 15 minutes leading up to the official start time of their shifts, at the request of Aldi.

The workers were regularly required to undertake tasks before they officially clocked on, including safety checks, communication devices and group warm up activities.

Aldi argued the employees were only expected to be ready to commence work at the start of their rostered shifts and it was not underpaying its employees.

Judge Douglas Humphreys disagreed and ultimately decided there was a “clear implied direction” that the employees were required to undertake the tasks and a failure to do so would result in disciplinary action.

He also said, “there was no personal benefit to the employee in the activities carried out, each was to the benefit of the employer,”

“In these circumstances, the court is satisfied that the activities carried out constitute work.” There is a clear distinction between employees being ‘work ready’ at the time they are due to commence work, versus actual activities that they are directed to do. Safety checks, communication devices and group warm up activities were found by the court to be actions which Aldi request that the employees do before the shift commences and because Aldi made those requests, it should be paying the employees to do them.

The SDA retail and warehouse union claims Aldi owes its distribution centre workers up to $10m in unpaid wages for working an extra 10 minutes per shift which was the time spent by employees doing the Safety checks, communication devices and group warm up activities. The money certainly adds up when payment should have been made for every employee, for every shift, and they were not.

The SDA retail and warehouse union claims Aldi owes additional pay to about 4,000 current and former workers.

This decision suggests the occurrence of employers requiring employees to complete tasks outside their official work hours is more widespread than first thought.  

Employers should take this case as a reminder to review current and historical requirements placed on their employees by employers to undertake actions prior to and after their regular working hours. There may be more cases of this kind in the near future.

When it comes to underpayments, the employment and litigation team at Osborn Law often work with employers and employees to decipher the timesheets, payslips and policies which determine a worker’s entitlements.

Solicitor Director, Christie Howson, who heads the employment team at Osborn law, says, “the team regularly pores through dense documentation to best respond to claims for underpayments on behalf of both employers and employees,”

“In this way, our team is able to consider both the legal entitlements and prospects of success of a claim and calculate the amount an employee may actually be entitled to.”

If you have concerns regarding payments made to or entitlements owing to your employees, please contact our employment team on (02) 4927 2900.