Toys“R”Us has apologised for underpaying up to 1,000 staff, avoiding legal action by the Fair Work Ombudsman

The retail giant has promised to voluntarily back-pay its employees a total of almost $1 million for underpaid entitlements during 2007 and 2009.

The staff were mostly casuals under 25 and worked at stores in South Australia, Victoria, NSW, Western Australia and the ACT.

Fair Work Ombudsman executive director Michael Campbell said an Enforceable Undertaking agreement was signed by Toys”R”Us after the Fair Work Ombudsman agreed to discontinue legal action against the company.

“The Fair Work Ombudsman announced in January last year that it was prosecuting Toys”R”Us for breaches of workplace law, but accepts that the contraventions were inadvertent and not deliberate,” he said.

Under the conditions of the agreement, Toys“R”Us has also set up a whistleblower hotline for its staff to complain about wages and conditions.
It pledged a $300,000 donation towards the cost of education and training needs of young and vulnerable workers and the protection of their rights at work.

In its letter of apology to staff, signed by the company’s executive vice-president Deborah Derby and Australian managing-director Tom Via, Toys”R”Us said the underpayments occurred as a result of “inadequate processes” and “inadequate governance measures” and expresses its “sincere regret”.

“Since the contraventions took place, new management has been appointed to human resources and Toys”R”Us has taken a number of steps to ensure that this does not occur again,” the letter says.