Western Power pays employees more than $8 million after 10 years of underpayments

Not even government enterprises are safe from the underpayments scandals that have rocked the supermarket and hospitality sectors, with Western Power the latest organisation to back-pay millions in owed wages to workers.

The electricity network provider has back-paid 1200 current and 1000 former employees a total of $8.29 million for underpayments from March 2010 to January 2020.

According to the Fair Work Ombudsman, Western Power failed to ensure workers on individual agreements were better off compared to their colleagues on group enterprise agreements, which meant they were getting shortchanged on progression payments, allowances, penalties, overtime, redundancy pay and superannuation.

After the Australian Service Union raised concerns, Western Power self-reported the underpayments to the ombudsman in 2019 and announced it was starting the back-payments in April. Final payments are due by October.

Wages compliance was put under the spotlight last year after a series of major companies reported underpayments in the order of millions of dollars.

Coles reported $20 million in underpayments, while Woolworths could be up for a whopping $400 million in back-pay after interest payments and other costs are factored into a $315 million underpayments scandal.

On Thursday, Ombudsman Sandra Parker announced Western Power had also entered into an undertaking forcing it to publicly apologise to its workers, conduct three separate audits, and tip $400,000 into the Commonwealth’s consolidated revenue fund, followed by a second payment next year.

The agreement will also require Western Power to operate a hotline for 12 months that workers can use to ask about their entitlements and underpayments or related employment concerns.

Western Power apologised to impacted workers in a statement on its website on Thursday.

"We express our regret and apologise to our employees impacted by the unintentional underpayment," it said.

"We’re confident that we can meet the timelines and fulfil the actions required by the enforceable undertaking."

Ms Parker said the electricity network provider had demonstrated a strong commitment to rectifying the underpayments but hoped the saga would prompt other companies to take notice.

“This matter serves as a warning to all organisations that if you don’t prioritise workplace compliance, you risk underpaying staff on a large scale," she said.

"Any employers who need help meeting their lawful workplace obligations should contact the Fair Work Ombudsman for free advice.”