Michael Hill to Repay Workers up to $17M
July 11, 2019
RAPAPORT... Michael Hill will hand out between AUD 10 million ($7 million) and AUD 25 million (just under $17.5 million) to compensate retail employees in Australia, after discovering it had been underpaying them.
The jeweler had been wrongly applying the pay rates mandated by the Australian government’s General Retail Industry Award document, it admitted in a statement Wednesday, following a review.
Daniel Bracken, the retailer’s CEO since November 2018, instigated the review, which he conducted together with PricewaterhouseCoopers. It found that the failure to comply had spanned the past six years, based on a sample of team members. Bracken will contact all employees to apologize and explain the process for establishing which of them had lost out, he explained.
“When we identified there was an issue, I mobilized a team, supported by independent external experts, to determine the scale of the problem, identify the individuals affected, and to ensure full compliance with the award going forward,” Bracken said. “We will move as quickly as possible to rectify any underpayments with those team members affected.” The company has started a more detailed review of all its employment records and practices.
The discovery caps off a challenging year for the Australia-based jeweler, with global sales falling 4.5% to AUD 563.4 million ($393.5 million) in the financial year that ended June 30, it reported Wednesday. Same-store sales slipped 3.5%. The slowdown eased in the fourth fiscal quarter, with revenues declining 1% to AUD 132.6 million ($92.6 million) in the three months to June. The company’s stock price dropped 9% Thursday.
“Even though we are experiencing an extremely competitive retail environment, particularly in Australia, with intensive competitor clearance-related activities and lower foot traffic, the company has continued to deliver improved sales momentum for the fourth quarter,” Bracken noted.
The one-off compensation cost will not significantly affect the company’s underlying earnings in this or future years, it added.
As of June 30, Michael Hill operated 168 stores in Australia, 52 in New Zealand and 86 in Canada.
Image: Daniel Bracken. (Michael Hill)
Article originally published on Diamonds.net here