Mining giant, BHP Group Limited, is the latest Australian company to admit to underpaying its workers, with the nation's largest iron ore producer, among other minerals, apologising for not paying additional leave entitlements to approximately 28,500 workers, since 2010.
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Repaying the workers will cost BHP as much as $430 million, making it one of biggest wages underpayment to date by an Australian public company.
It came after BHP identified issues with certain allowances and entitlements affecting a number of its current and former employees in Australia.
In a statement to the ASX, and released on it's website on June 1, stated a preliminary review suggested that certain rostered employees across it's Australian operations have had leave incorrectly deducted on public holidays since 2010.
BHP stated there were approximately 28,500 affected current and former employees with an average of six leave days in total that have been incorrectly deducted from it's affected employees within a 13 year period.
Initial investigations also revealed that OZ Minerals, which was acquired by BHP in May 2023, had also been affected by a similar leave deduction issue.
In addition, BHP has identified that approx 400 current and former employees at Port Hedland are entitled to additional allowances due to an error with the employment entity in their contract.
Based on currently available information, it is estimated that the cost of remediating the leave issue and the contracting issue will be up to US$280m (AUS$430m) pre tax, incorporating on costs including associated superannuation and interest payments (BHP share).
The company stated that it's continuing to investigate and an update will be provided in their full year results in August.
BHP Group Limited's Ausralia president, Geraldine Slattery, apologised for the error and said the company was working to rectify these issues.
"We are sorry to all current and former employees impacted by these errors," Ms Slattery said in a statement.
"This is not good enough and falls short of the standards we expect at BHP.
"We are working to rectify and remediate these issues, with interest, as quickly as possible."
BHP has enaged global assurance firm, Protiviti, to conduct a thorough review of their payroll systems.
The company said it will contact affected current and former employees regarding remediation as soon as possible and a dedicated hotline and website will be established to provide assistance from Friday, June 2.
