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Drakes hit with class action over alleged underpayments
South Australian family-owned supermarket chain Drakes has been hit with a potential $20 million class action alleging it underpaid staff.
Tony Zhang
Canberra-based law firm Adero has filed a class action in the Federal Court, alleging Drakes’ staff were not paid allowances and entitlements owed from performing overtime and penalty work.
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The firm claims employees had been paid for 38-hour weeks, were rostered to work 45 hours or more per week and worked in excess of rostered hours.
The statement of claim, lodged with the Federal Court on Monday, 26 October, alleges that staff had uniform costs deducted from wages and in 2017 directed staff not to record their hours on an electronic time recording system.
In a statement, Adero Law said it had “instructed” that Drakes Retail Group “harboured a culture where excessive hours were expected of all salaried staff, which flowed from the very top of the Drakes’ management.”.
“In particular, Adero is instructed that salaried employees were consistently rostered hours in excess of their contract terms and were then expected to work beyond those rostered hours,” Adero Law said.
Adero Law associate Richard Murray stated the class action against Drakes currently involved 81 workers, but that up to 1,500 current and former employees may be eligible to join.
“Staff were paid an annualised salary and not according to the hours they worked each week,” he said.
“I think retail workers in particular are quite vulnerable to this kind of underpayment.
“Corporations either deliberately or inadvertently are not applying the award correctly so that these large scale underpayments are occurring, and it’s unfortunately become quite prevalent in the last couple of years.”
The lead plaintiff in the case is Craig Schonweiss, who was underpaid having worked at Drakes’ stores at Hallett Cove and in Queensland for more than a decade.
As of Wednesday, 81 workers had registered interest in the claim but Adero Law considered up to 1,000 current and former employees could be eligible for compensation.
“A conservative assessment of the level of underpayment across the class exceeds $20 million over the claim period, not including any statutory penalties the Federal Court may be minded to impose,” the firm said.
Drakes stated they will “vigorously” defend the allegations.
The company is the latest major South Australian retailer to face underpayment claims, with similar ongoing lawsuits filed against South Australia’s Romeo Retail Group and OTR, operated by the Shahin family.
Earlier this year, Coles admitted underpaying staff across its supermarket and liquor stores and set aside $20 million to pay back employees, while Woolworths began paying back up to $300 million in December.
