Mining giant BHP has admitted to underpaying almost 30,000 workers dating back to 2010.
The repayment bill will exceed $400 million.
BHP admitted it failed to deduct leave correctly on public holidays for 28,500 employees, in a statement to ASX.
A further 400 employers will be repaid additional allowances that were denied "due to an error with the employment entity in their contract".
BHP says it will reach out to current and former staff after reporting the issue to the Fair Work Ombudsman.
BHP criticises “same job, same pay” laws
Last week BHP criticised the federal government’s plan to introduce “same job, same pay” laws, which would ensure labour hire workers are paid the same as other workers doing the same job.
The mining giant said it would add $1.3 billion to its wages bill every year.
Federal Workplace Relations Minister Tony Burke highlighted the need for the legislation in response to BHP’s underpayment scandal.
"Just last week BHP were trying to assure us that their employment practices were impeccable and the government didn't need to close any loopholes to protect wages," Mr Burke said.
"That's clearly not true.
"Australia can do better to make sure workers are properly paid. That'll be the focus of our legislation in the coming months."
Laundry list of wage scandals
Queensland Unions Acting General Secretary Jacqueline King said BHP was just the latest addition to a laundry list of wage scandals.
“Last year, it was a $500 million wages scandal at Woolworths and the year before that a $100 million repayment was owed to Coles workers,” Ms King said.
“If an employee took money out of the till that would be considered theft, but too often these employer underpayment cases are dismissed as mistakes or accounting deficits.
“Underpaying workers has been accepted as a common occurrence; this cannot continue.”
Ms King said Queensland Unions looks forward to the introduction of “same job, same pay” legislation.
“There’s clearly a need to restore balance in the relationship between workers and employers,” she said.
“Workers are only now coming out of a record period of flat wage growth, which has been exacerbated by legal loopholes that allow employers to undercut pay and conditions.
“Closing these loopholes will assist unions in doing their most important job: winning better pay and conditions for all workers.”
