Supermarket giants Coles and Woolworths expect to spend hundreds of millions of dollars more to repay staff the companies underpaid, following a legal judgement experts say could have wide-reaching implications.
Woolworths has flagged potential additional costs topping $500 million after tax, while Coles has put its preliminary estimate at up to $250 million.
The development could see the total cost of the underpayment scandal soar past $1 billion, with Woolworths having already repaid $330 million to thousands of staff, while Coles has repaid $31 million so far, and had set aside a further $19 million before Monday's extra provision.
On Friday, the Federal Court handed down a judgement on the historical underpayments of employees at the two major supermarkets, affecting nearly 30,000 employees.
The dispute centred on annual salary arrangements, where the employees were paid above the award rate over the year, in place of calculating actual entitlements — under what was known as a "set-off" arrangement.