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Lush admit underpaying their staff by $2 million since 2010

By Hayley July 17, 2018
Image: Lush Cosmetics / Instagram

Bath bomb giant Lush Cosmetics have admitted underpaying their staff by a total of $2 million over the past eight years. 

The company admitted the “serious payroll failure” today, while announcing a new scheme to make sure every underpaid employee, past and present, gets paid back - no matter how small the outstanding amount.

Lush employees identified the payroll issue in August last year - with the company confirming in December that it had breached three separate areas of the Retail Award.

Lush Australia director Peta Granger apologised profusely to staff in a statement today:

“We are deeply sorry to our valued staff and customers that we’ve failed to uphold the values that we have always believed in and the high standards that we’ve always sought to achieve.

“This resulted from a very serious failure on our part to upgrade our internal systems. We should have had far more respect for our people’s pay and upgraded our payroll infrastructure to keep up with the growth of our business. 

“We would never knowingly under pay. This was not deliberate. It goes against everything we value and believe in, and we are so sorry to have let our staff down in this way.”

Lush blamed their error on their use of a "very manual" payroll system, which was "not sophisticated enough" to navigate Australia’s complex awards system, which has over 100 different pay rates determined by age, employment status and shift times/overtime.

Part-time employees who worked overtime are said to be the ones expecting the biggest compensation.

Granger said Lush are investing $1.5 million into a payroll system upgrade, which will involve scanning and re-entering 200,000 handwritten paper timesheets dating back to 2010.

"This is a complex process, and realistically it will take the rest of this year to get it right. We are confident, however, that back payments including interest will begin to be paid by December."

Images: Lush Cosmetics / Instagram