Federal Court Judge, Justice Nye Perram has published his decision regarding the underpayment of Award-covered salaried staff at Coles and Woolworths, which could cost the supermarket giants hundreds of millions of dollars.
The judgment relates to proceedings brought by the Fair Work Ombudsman (FWO) in 2021, and a class action (in 2019), over the interpretation and application of the General Retail Industry Award 2010 (GRIA), and the Fair Work Act (FWA), in remediation payments to salaried employees at both Coles and Woolworths.
Justice Perram’s 82,000 word ruling was published on Friday and both supermarket giants said they have conducted a preliminary review of the decision, and are continuing to investigate the ruling further.
Woolworths said this morning: “The judgment is lengthy and complex and does not determine all issues in the proceedings. A case management conference has been listed for 27 October 2025 to consider the further conduct of the proceedings with many issues still to be determined. No other substantive orders have been made.
“It is too early to consider any appeal of any aspects of the decision. This decision will require significant and widespread changes to accepted retail practice for Woolworths Group and Australian businesses, large and small.
“The Group has already undertaken an extensive remediation for its affected salaried store leaders, drawing on team member records and contractual arrangements, expert external guidance and industry standard approaches to construction of the award.”
Coles added: “We are progressing work to understand and quantify the potential implications of the decision for our business. As previously stated, the judgment in the proceedings is complex. A number of issues regarding the interpretation of the GRIA remain outstanding and will require further court hearings to determine.
“Coles cautions the market from relying on speculative estimates which may not have adequate regard to the application of the decision to Coles’ specific circumstances.”
Both supermarkets also outlined preliminary estimate costs of the further remediation to staff.
Coles said: “Coles’ preliminary estimate is that further remediation of between $150m and $250m may be required to reflect the findings of the Court, including interest and on-costs.
“The range has been calculated based on the underpayments alleged by the FWO relating to historical work patterns, adjusted and extrapolated for the period for which Coles has committed to remediation and the broader population of affected salaried team members covered by the GRIA across Coles’ supermarkets business.
“It also reflects a potential adjustment for the period since Coles’ initial remediation process was conducted.”
Woolworths said: “On the basis of the preliminary review of the Court’s reasons published on Friday, Woolworths Group estimates that the one-off additional impact of the Court’s findings, in relation to its potential liability for further remediation to salaried store team leaders is expected to be in the range of $180m to $330m post tax ($250m to $470m pre-tax). Once the final remediation obligation is determined, interest, superannuation and payroll tax could add another $140m to $200m post tax ($200m to $280m pre-tax) to the net liability.
“Woolworths Group’s estimate of further potential liability includes an assessment of the impact on all salaried store team members primarily relating to the Court’s ruling on set-off provisions, minimum breaks and treatment of leave in relation to overtime. The estimate includes further remediation related to historical underpayments from 2013 to 2019 and the impact of the ruling on set-off from 2019 to 2025.
“This is a very preliminary estimate with significant uncertainty, and is based on a historical analysis of clocked time and attendance records. Further detailed review and modelling of team member records and consideration of the Court’s decision is required to determine the full financial impact.”
Justice Perram was highly critical of both supermarkets’ payroll and record-keeping practices, saying Coles’ failure to operate an overtime system for employers created an “evidentiary vacuum a calamity which belongs to Coles and not its employees”.
The future conduct of proceedings relating to the cases will be discussed at the case management hearing which takes place on Monday, 27 October.