BHP Group Unveils Employee Allowance Issues Impacting Thousands in Australia

BHP Group
  • BHP Group identifies errors in employee allowances and entitlements impacting current and former employees in Australia.
  • Preliminary review reveals incorrect leave deductions on public holidays since 2010, affecting approximately 28,500 employees.
  • Additional contracting issue discovered, with around 400 employees at Port Hedland entitled to additional allowances.

BHP Group Limited (ASX: BHG), one of the world’s leading resources companies, has recently announced the discovery of significant issues concerning certain allowances and entitlements that have affected a considerable number of its current and former employees in Australia. The company has taken swift action to conduct a thorough review and address these errors, ensuring remediation for the affected individuals.

According to a preliminary review conducted by BHP, it has come to light that since 2010, numerous rostered employees across BHP’s Australian operations have experienced incorrect deductions of leave on public holidays. The impact of this issue has been significant, affecting approximately 28,500 current and former employees. On average, each affected employee has had six leave days incorrectly deducted over a 13-year period.

In addition to the leave deduction matter, BHP’s review has uncovered a similar issue within OZ Minerals, which was acquired by BHP in May 2023. BHP is committed to addressing this issue promptly, alongside rectifying the leave deduction matter.

Furthermore, BHP has identified approximately 400 current and former employees at Port Hedland who are entitled to additional allowances due to an error in their employment contracts. The company is actively working to rectify this contracting issue and ensure that affected employees receive the entitlements they deserve.

Based on the currently available information, BHP estimates that the total cost of remedying both the leave deduction and contracting issues will be up to US$280 million pre-tax. This estimate includes associated superannuation and interest payments. BHP is continuing its investigations, and a comprehensive update will be provided in the full-year results announcement scheduled for August.

Expressing her deep regret, Geraldine Slattery, President Australia at BHP Group, offered her apologies to all current and former employees impacted by these errors. Slattery emphasized that the company acknowledges the failure to meet its expected standards and is fully committed to rectifying and remediating the issues as quickly as possible.

To conduct a thorough review of the payroll systems, BHP has engaged Protiviti, a renowned global assurance firm. Protiviti will perform an in-depth assessment to identify the root causes of the errors and provide recommendations to prevent similar issues from occurring in the future.

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