Chemist Warehouse underpaid staff by millions despite government subsidies

Retail giant Chemist Warehouse failed to raise workers’ pay, despite receiving Commonwealth subsidies to train them at higher qualifications, a tribunal has found.

The failure could lead to the company paying more than $10 million in backpay claims.

The Financial Review reported that in a major test case, the South Australian Employment Tribunal found that four Chemist Warehouse stores in Adelaide underpaid seven workers who had a Certificate III in community pharmacy, by classifying them at lower levels- even after they gained the qualification.

The Shop Distributive and Allied Employees Association brought the action. The secretary secretary Josh Peak said the ruling it “has serious implications for Chemist Warehouse stores right across the country”.

He added, “This is a systemic problem at Chemist Warehouse. It’s not isolated to a few pharmacies doing the wrong thing, it is a nationwide issue."

“Chemist Warehouse workers could be owed tens of millions in backpay if they’ve been directed to work above their assigned classification.”

He said, “the fact that the employer was pocketing government subsidies but didn’t give workers a pay rise is outrageous”.

The stores in question had subscribed to a federal government training scheme to upgrade their pharmacists’ qualifications to a Certificate III.

But a store manager told the tribunal this was “driven by financial incentives offered by the government, rather than by any expectation that pharmacy assistants would need the Certificate III (or its competencies) to perform their role”.

The staff received $250 of the subsidy to up skill, while the Chemist Warehouse store received a certain undisclosed amount for encouraging them to do so.

The issue arose when the staff members' duties weren't increased, meaning that they could still be paid at a lower rate.

Workers were underpaid $1.57 an hour, or about $60 a week, as a result.

Main image: A Chemist Warehouse store

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