Woolworths has admitted to underpaying nearly 6000 employees over the past nine years - and has vowed to repay up to $300 million to affected workers.
The figure has eclipsed scandals in the fashion sector include Michael Hill, Super Retail Group, Wesfarmers and MJ Bale.
Woolworths has however, confirmed a review of its other Australian businesses including Big W department stores.
Woolworths said the irregularity was uncovered during the implementation of a new enterprise agreement with employees, where a review uncovered the stark figure.
While only two years of data had been analysed, the underpayment could date back to 2010 with between $200 million and $300 million staff potentially repaid.
It affects salaried team members not checkout and supermarket floor staff.
Group CEO Brad Banducci has issued a statement on the matter.
“As a business, we pride ourselves on putting our team first, and in this case we have let them down,” he said.
“We unreservedly apologise. The highest priority for Woolworths Group right now is to address this issue, and to ensure that it doesn’t happen again.”
Australian Payroll Association CEO Tracy Angwin said this is not an isolated incident.
“Woolworths is facing an issue that many companies are finding themselves in due to a lack of a regular payroll compliance audits.
"The underpayment goes as far back as 2010, which shows a lack of reviewing payroll systems to ensure that employee pay is being calculated correctly.
"Often, companies fall into the trap of adopting a set and forget mentality to payroll systems, which can lead to major underpayments such as this one.
“This is made worse, when organisations have a lack of qualified payroll staff that are unable to pick up these errors prior to them becoming a massive issue.
"With government legislation and employee awards constantly changing, it is crucial for companies to hire trained payroll professionals that regularly attend training to keep up to date with their payroll knowledge.
"That way companies can avoid becoming the next underpayment scandal headline.”