Westpac to repay $8m to 8,000 workers underpaid for long service leave

Westpac has said it will repay $8m to about 8,000 workers who it underpaid by incorrectly calculating their long service leave entitlements.

The bank joins a long list of Australian companies, including rival Commonwealth Bank, Woolworths and the ABC, that have admitted to underpaying staff.

“We apologise to anyone impacted by these errors and our priority is to make payments as soon as possible,” Westpac’s head of enterprise services, Alastair Welsh, said.

“For long service leave entitlements, different rules apply to different employees based on their employment history and work arrangements. Regrettably, our system didn’t correctly capture the right methodology every time.”

He said the bank was putting systems in place to make sure long service leave was correctly calculated.

“We are committed to putting things right for our people and preventing the issue from re-occurring, and we will continue to check our processes to ensure employees receive their correct entitlements,” he said.

The bank said the $8m included interest. It is understood the bank will start distributing the money to underpaid staff from next month.

No money will be clawed back from anyone who might have been overpaid.

The $8m underpayment is far less than the more than $50m CBA has paid out to about 41,000 current and former employees for underpayments stretching back to 2010.

And both are smaller than the $390m supermarket giant Woolworths expects to pay to resolve what is believed to be Australia’s biggest underpayment case.

There is no suggestion Westpac deliberately underpaid its workers.

Doing so – “wage theft” – was made a crime in Victoria last month. It attracts penalties of a fine of up to $1m and up to 10 years’ jail.

WA has legislation before state parliament designed to curb wage theft and the federal government has also proposed changing the law to tackle the problem.

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