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Australia's largest car dealership business, Eagers Automotive Limited, has back-paid more than $16 million to thousands of workers who were underpaid by five of its subsidiaries.
The underpayments occurred between 2013 and 2021, and impacted 13,277 current and former employees.
Individual back payments to employees range from less than $1 to $69,298, and the average back payment is about $1,217, including superannuation and interest.
Eagers Automotive Limited (EAL) self-reported the underpayments to the Fair Work Ombudsman in June 2021.
It says after it acquired Automotive Holdings Group Limited (AHG), the holding company for 19 businesses, in 2019, it initiated a review of the companies' payrolls and found anomalies in relation to 19 AHG subsidiaries.
Its review found AHG subsidiaries had unlawfully failed to pay staff in line with award progression, had incorrectly classified employees, did not pay overtime, annual leave and annual leave loading, did not pay for training and failed to pay, as required, when employees were sent home due to no work.
Eagers informed the regulator in June 2021 and the five subsidiaries have signed an enforceable undertaking (EU) with the regulator.
"It's pleasing that EAL proactively looked for issues in its new acquisitions, then self-reported to FWO and endeavoured to rectify them," Fair Work Ombudsman Anna Booth said.
As a holding company, Eagers (EAL) is now Australia's largest car dealership business, with annual revenue of $9.85 billion.
It operates dealerships that collectively sell almost all major vehicle brands, including Toyota, Ford, Mercedes-Benz, Kia, Volkswagen and Hyundai among many others.
Employees affected by the underpayments were engaged full-time, part-time and casually across car and truck dealerships in the network as finance officers, and in car sales, parts sales and servicing employees.
The enforceable undertaking is with five companies: AHG Newcastle Pty Ltd, AHG Services NSW Pty Ltd, AHG Services Qld Pty Ltd, AHG Services Vic Pty Ltd and AHG Services WA Pty Ltd.
Under the EU, the five companies must also make a combined $450,000 contrition payment to the Commonwealth's Consolidated Revenue Fund.
Rectifications outside of the requirements of the EU include an additional $1.9 million, including interest and superannuation, back-paid to 701 current and former employees of 14 other subsidiary companies.