Aldi forks out another $25+ million in long-running class action on pre-shift work

An SDA prediction that supermarket giant, Aldi, owed thousands of employees millions of dollars in backpay for designated tasks they were directed to complete before work each day has come to fruition, though the more than $50 million the company will have paid out upon final settlement remains a fraction of the $150 million compensation originally foreshadowed.

In 2022, the Shop, Distributive & Allied Employees’ Association (SDA) secured a judgement of the Federal Circuit and Family Court of Australia confirming that Aldi was liable for time spent by employees undertaking tasks before a shift which were performed at the direction of and “solely to the benefit of the employer”. In coming to his finding, Judge Humphreys identified the list of tasks employees were required to complete (or face disciplinary action) constituted work for which they were entitled to be paid, observing the functions “cannot be characterised as private activity in that they do not involve any activities that are of benefit to the employee, such as storing of personal effects, putting on uniforms or PPE.” The decision stands as a useful reference for distinguishing when pre-work (or post-work) tasks and activities should be considered paid time, or otherwise. Refresh with our original news post here.

At the time, the SDA suggested the liability, which dated to 2018, totalled $10 million and impacted approximately 4,000 workers but when Aldi failed to “confer and agree” with the SDA on a methodology for determining compensation for employees in a timely manner (as per the direction of Judge Humphreys), the SDA launched a class action encompassing more than 20,000 former and current staff members in October 2023. The class action sought compensation for all employees for work performed before and after shifts with the SDA estimating a typical worker would be eligible for about $7,500 in compensation, or up to $150 million in total for the group.

In July, the SDA confirmed Aldi would be obliged to pay $26.3 million to finalise the matter, which is additional to the $28.9 million it had already restored to 32,000 current and former workers for pre-shift work since 2018. A separate case also initiated by the SDA seeking penalties for the alleged conduct has been provisionally settled, though Aldi has made no admissions as part of the settlement (which must be approved by the Federal Court) and continues to deny the SDA’s allegations.