Caltex to pay up to $20m in underpayments

Caltex is setting up a $20m fund to pay back underpaid staff.

An assistance fund of $20 million will be set up by Caltex Australia for employees who have been underpaid by Caltex franchisees.

Staff who were not paid their full entitlements from 2015 onwards will be able to claim back what they are owed from franchise owners of the petrol retailer.

In an audit that saw unsettling results, it was revealed that around 80 per cent of audited Caltex petrol stations were underpaying staff members, as reported by The Sydney Morning Herald.

A statement from Caltex said they had no liability to pay employment entitlements.

“The fund has been established because Caltex wants to do the right thing by franchisee employees,” it said.

“Caltex has been part of Australian corporate life for more than 115 years and cares deeply about doing the right thing, including by paying fair and reasonable wages.”

As a result of the initial audit, Caltex has terminated agreements with 19 of its franchisees for the underpayment of their staff members.

The statement continued on to say that Caltex did not support the illegal and unfair practice of underpaying staff.

“Caltex will seek to recover the costs of its fund from franchisees responsible for underpayment of their employees’ entitlements,” it said.

Caltex has previously invited employees and former employees of Caltex franchisees to speak up if they believe they were being underpaid with an independently-managed, confidential hotline set up in late 2016 for staff to report such issues.

Once claims made have been substantiated, the fund will be administered.

The statement concluded that Caltex is seeking to assist current franchisee employees by offering employment.

“…Caltex seeks to offer employment under Caltex terms and conditions, which observe all workplace laws including wage rates, when a franchisee exits and Caltex takes over operation of a site,” it said.

Caltex is continuing to audit the remaining stores across its network and take action where necessary.


Correction: An earlier version of this story stated that 80 per cent of Caltex service stations were involved in underpayments, which was incorrect. It is the case that 80 per cent of audited Caltex service stations were involved in underpayments.

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