The Coles Group Ltd (ASX: COL) share price is down 1% after providing a wage update to investors.
Court decision on wages
Coles noted that in February 2020 it announced it was conducting a review into the pay arrangements for all team members who received a salary and were covered by the General Retail Industry Award 2010 (GRIA)
The supermarket business apologised to affected team members and conducted a remediation program, which to date has paid $31 million of remediation costs.
A class action was started in May 2020 and the Fair Work Ombudsman started proceedings in December 2021.
The Federal Court of Australia made a decision on 5 September 2025 on those proceedings.
Coles said it’s progressing work to understand and quantify the potential implications of the decision on its business. A number of issues regarding the interpretation of the GRIA remain outstanding according to Coles and will require further court hearings to determine.
Coles wanted to caution the market on relying speculative estimates which “may not have adequate regard to the application of the decision to Coles’ specific circumstances”.
The cost of the decision
Coles said the preliminary estimate is that further remediation of between $150 million to $250 million may be required to reflect the findings of the Court, including interest and on-costs.
This range has been calculated based on the underpayments alleged by the Fair Work Ombudsman (FWO) relating to historical work patterns, adjusted and extrapolated for the period that Coles has committed to, as well as the broader population of affected salaried team members covered by the GRIA across its supermarket business.
Coles also said that the above reflects a potential adjustment for the period since Coles’ initial remediation process was conducted.
Is the Coles share price a buy?
I wouldn’t say it’s significantly better value than it was last week, but I have been impressed by how Coles has delivered better sales growth than Woolworths Group Ltd (ASX: WOW).
Coles is the one to own right now, in my opinion. But, there are other ASX dividend shares I’d buy for income instead.
