The Fair Work Ombudsman is prosecuting retail giant Toys ‘R’ Us, saying the company has underpaid more than 700 staff.
Documents lodged in the Federal Magistrates Court in Sydney allege that Toys ‘R’ Us failed to compensate the underpaid workers within the time frame required under workplace laws.
It is alleged that hundreds of the company’s workplace agreements were invalid because they failed either the Fairness test or No Disadvantage test.
The ombudsman claims that insufficient pay rates contained in the invalid workplace agreements resulted in Toys ‘R’ Us underpaying more than 700 employees for various periods between 2007 and 2009.
It finally completed the backpays in March 2009 – reimbursing its workers a total of $445,000. Some had waited up to nine months to receive their outstanding entitlements.
The Fair Work Ombudsman also alleges that Toys ‘R’ Us failed to follow correct procedures when lodging many of its workplace agreements.
Acting Fair Work Ombudsman Natalie James says the decision to prosecute the company was made because of the significant amount involved and the company’s extensive failure to meet its obligations.
“Underpaying young workers is a particularly serious matter,” she said.
The Fair Work Ombudsman alleges Toys ‘R’ Us committed more than 20 contraventions of workplace laws. It faces a maximum penalty of $33,000 per breach.
The case is listed for a directions hearing on February 1.