Thousands of Argos workers to share £2.5m payout after bosses discover they were paid BELOW the minimum wage
Around 37,000 old and current employees will receive an average payout of £64 each
AROUND 37,000 current and former Argos workers are to receive an average of £64 each after "incorrect" payments were discovered.
Sainsbury's, which took over the high street chain six months ago, said the workers had been paid below the national living wage.
The underpayments happened because staff has to attend briefings before they clocked on to do their shifts, as well as security searches once they'd finished work.
It meant staff were not paid for this additional time spent at work.
As a result, 12,000 current employees and 25,000 former employees were not paid the correct wage.
In total, they are owed £2.4 million, around £64 each. Staff will be paid this money at the end of the month.
In an internal note to employees, John Rogers, chief executive of Argos, said: "After we acquired the Argos business last year it was brought to my attention that, as part of a routine visit, HMRC had uncovered an issue with some of our Argos store systems and processes, which means that some colleagues have been paid below the national living wage.
"In particular, this related to the timings of colleague briefings, which could happen before colleagues had clocked into their shifts and security searches, which could happen after colleagues had clocked out of their shifts.
"Sainsbury's prides itself on being a trusted brand where people love to work and I was, therefore, very disappointed to hear this and launched an immediate investigation."
Rogers added: "We concluded our conversations with HMRC last week and are telling Argos store colleagues this week that, where they were paid below the national living wage prior to December 2016, they will receive a payment on 28th February for the amount owed to them."
He said new processes had been introduced to ensure there can be no repeat of the issue.
Sainsbury's is now proposing to give most Argos store colleagues a 2 per cent pay increase, and to move the basic rate of pay for some workers aged over 25 from £7.20 to £7.66 an hour.
The company was fined £1.5 million by HMRC as a result of the underpayments. If the company pays back the taxman within 14 days, it will only have to pay £800,000.
The announcement came after the Government named and shamed 360 businesses for underpaying thousands of workers a total of almost £1 million.
Retail giant Debenhams was named as the worst offender, after failing to pay almost £135,000 to just under 12,000 workers.
The company said it made a technical error in its payroll calculations, which resulted in an average underpayment of around £10 per person to affected workers in 2015.
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