Coles may have to renegotiate wages deal

A Coles worker has won a David and Goliath battle against his employer and one of Australia's most powerful unions, potentially forcing the supermarket giant to renegotiate wages and conditions of thousands of employees.

Key points:

• The decision could affect 77,000 Coles employees
• The commission ruled that Coles had overvalued some benefits in EBAs
• Coles has been given 10 days to remedy the failings

Duncan Hart, a student who works part-time at a Coles supermarket in Brisbane, took action in the Fair Work Commission last year.

He claimed the enterprise bargaining agreement between Coles and his union, the Shop Distributive and Allied Employees Association (SDA), left thousands of workers worse-off than they would be under the award, and was therefore invalid.

In a decision published on Tuesday morning, the Fair Work Commission sided with Mr Hart and ruled that the Coles EBA, which covers some 77,000 employees, failed what is known as the better off overall test (BOOT).

Mr Hart said the decision was a victory not just for Coles employees, but for retail workers more broadly.

"It shows that you can't just cut penalty rates, increase the overall base rate and actually still say that people are better off overall," Mr Hart said.

"There will be people who work those unsociable hours who will be worse-off and that's what we saw with the Coles agreement and it was tens of thousands of Coles workers that were worse-off."

The commission gave Coles 10 days to remedy the failings in the EBA before it quashed its original approval.

The decision could force Coles to renegotiate wages and conditions for its workforce of 77,000 employees.

The Coles agreement in question, which was approved by the Fair Work Commission in July last year, mandated a higher hourly base rate for supermarket workers, but cut penalty rates for weekends and nights.

Mr Hart argued that this left a substantial proportion of the Coles workforce worse-off than if they were paid under the existing award.

For a workplace agreement to be legal, all employees must be made better off when an agreement is compared to the award.