Woolworths’ cleaning contractors fall afoul of workplace laws

A Fair Work Ombudsman inquiry into the procurement of cleaners in Tasmanian supermarkets found that 90 per cent of Woolworths’ supermarket sites in the state were non-compliant.

The inquiry was begun in late 2014 in response to intelligence received by the Fair Work Ombudsman that supermarket cleaners in the state were being significantly underpaid.

It looked into contracting arrangements for cleaners at all 31 of Woolworths’ Tasmanian sites, as well as seven Coles sites (44 per cent of Coles’ Tasmanian sites) and 17 IGA sites (21 per cent). The inquiry’s focus on Woolworths sites was due to it being the only retailer of the three operating in Tasmania outsourcing its day-to-day cleaning services.

Fair Work Ombudsman Natalie James said that the inquiry report shows how alarming levels of exploitation can occur where supply chains involving vulnerable workers are not adequately monitored.

“Our inquiry found deficiencies in Woolworths’ governance arrangements with regard to its procurement and oversight of cleaning contracts, resulting in serious exploitation occurring at multiple levels of its cleaning supply chain,” Ms James said.

“We uncovered breaches across 90 per cent of Woolworths’ Tasmanian sites, including cases of contractors paying cleaners as little as $7 per hour for training and $14 per hour for work – well below their legal entitlements.”

Ms James said cleaners were often paid in unrecorded cash-in-hand payments with no payslips provided. “Overall, record-keeping by contractors engaged at Woolworths’ sites was abysmal – at 84 per cent of sites, workplace records were inaccurate or not kept at all,” she said.

The Fair Work Ombudsman entered into a Proactive Compliance Deed with Woolworths last year under which the supermarket giant has committed to monitor and regulate its trolley-collection network to ensure workers at its sites nationwide are receiving their correct pay and entitlements.

Following its latest Inquiry, the Fair Work Ombudsman recommends the deed be expanded to cover Woolworths’ cleaning supply chain too.

In particular, the agency recommends that Woolworths commit to back-paying underpaid cleaners who have not had those underpayments rectified by the relevant contractor, and to conduct regular audits of its contractors to ensure compliance with workplace laws.

“I’m pleased that since the commencement of the inquiry, Woolworths has implemented improvements in its governance arrangements and is continuing to work constructively with my agency to make further positive changes,” Ms James said.

The Fair Work Ombudsman is calling on Woolworths, Coles and IGA to become members of the Cleaning Accountability Framework, an industry-led initiative that promotes the adoption of best practice throughout the cleaning supply chain to improve labour and cleaning standards in Australia.

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