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Category: Company News / Retail / Work

Dick Smith investigated over employee underpayment

Friday, 5 Feb 2016 06:24:00 | Peter Ryan

Police officers line up for inspection yesterday before going out on patrol in Dalian, a coastal city in northeast China’s Liaoning Province. The three-day Summer Davos forum begins in the city today to discuss China and global economic growth, and technological innovation. — Xinhua

The Fair Work Ombudsman has launched an investigation after evidence emerged that failed electronics chain Dick Smith might have underpaid its employees.

The revelations have surfaced as Dick Smith's receivers and managers dig through the financial embers of the company which collapsed early last month.

In a statement to the ABC, a spokeswoman for the Ombudsman said Dick's Smith's receivers and managers Ferrier Hodgson had been in touch about the possible underpayments to 3,200 workers.

"We are now making our own independent inquiries with a view to working co-operatively with the receivers ... and those workers who have been impacted," a spokeswoman said.

Ferrier Hodgson discovered the discrepancies, worth as much as $2 million, as it scours Dick Smith's books to determine what went wrong and what can be recovered for creditors.

Ferrier Hodgson receiver James Stewart said that the underpayments - which go back to 2010 - do not appear to be deliberate.

"The underpayment of entitlements appears to reflect an incorrect application of the relevant industrial award," Mr Stewart said in a statement released yesterday.

The Fair Work Ombudsman's office says it will be getting in touch with Dick Smith employees which might have been underpaid.

The underpayments could also concern retail giant Woolworths, which owned Dick Smith in 2010 before selling it to private equity.

Dick Smith collapsed early last month owing hundreds of millions of dollars to creditors, including banks, employees, suppliers and customers.

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