The compliance deed commits the supermarket giant to monitor its contractors to ensure they’re paying their workers correctly and meeting workplace obligations.
“It does serve as a warning to companies that are using labour contracting arrangements particularly in what we would say are high risk industries…where the work is labour intensive, (and) is low-skilled,” Ombudsman Natalie James told ABC radio on Wednesday.
Under the deed Woolworths is required to audit pay records of businesses tendering for trolley collection contracts and any trolley collector who is deemed to have been underpaid since July 1 2014 will be back-paid.
“We need to be looking at other industries as well,” she said, nominating cleaning, security and horticulture as being on her radar.
Such sectors attract visa holders who are often not aware of their rights or are hesitant to come forward to seek help, Ms James said.
The ombudsman has begun 17 legal proceedings against trolley collection businesses over the last decade.
“Our inquiry found that Woolworths’ existing governance systems were not effective in addressing these issues, contributing to a culture of non-compliance by its contractors,” James said.
“I am pleased that Woolworths has demonstrated its positive commitment to improving its management of contractors by entering into this compliance partnership with the Fair Work Ombudsman.”
In October 2014, rival supermarket chain Coles entered into an enforceable undertaking with the Ombudsman in order to rectify high levels of non-compliance found within its network of trolley collection services.
This followed the signing of a compliance deed between the Ombudsman and United Trolley Collections (UTC) Pty Ltd, Coles’ primary trolley collection service provider, committing UTC to ensuring its subcontractors comply with workplace laws.
“With Australia’s two largest supermarket retailers now accepting a moral and ethical responsibility for ensuring the trolley collectors on their sites are being treated fairly regardless of who their employer is, we hope that rampant underpayment of this vulnerable cohort becomes a thing of the past,” said James.
Woolworths head of facilities management Trent Mason said the company had implemented many of the obligations set by the Deed.
“Woolworths will continue to assume overall responsibility for its trolley collection services including continuing to ensure contractors fully comply with Australian workplace laws across its network of sites,” he said.
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