Calls for large retailers to return JobKeeper after Super Retail Group joins Toyota and repays $1.7 million

Super Retail Group, the owner of brands including Rebel and Macpac, announced on Monday it will return $1.7 million of JobKeeper subsidies to the federal government after recording a record profit.

The company revealed an expected $170 million net profit after tax for the second half of 2020 across all its brands in its trading update on Monday, including an 87% increase in online sales.

Dr Louise Grimmer, senior lecturer in marketing and retail at the University of Tasmania, says businesses that have returned JobKeeper are to be “commended”, and more should consider returning JobKeeper funds unless they wish to “face backlash”.

“Given the strong results we’ve seen coming out of 2020, especially for Super Retail Group and for other large chains such as Harvey Norman, I think the onus is now definitely on these large retail brands to do the right thing and return the subsidy,” Grimmer tells SmartCompany.

Super Retail Group is the second company to publicly announce it will return money received through the JobKeeper wage subsidy scheme.

Toyota announced last Tuesday it would return $18 million in JobKeeper subsidies, saying in its statement it was “the right thing to do as a responsible corporate citizen”.

Potential backlash

On Monday, federal Treasurer Josh Frydenberg said he welcomed Super Retail Group’s decision to return JobKeeper, while adding that eligible businesses had no obligation to return payments.

“Businesses have no legal obligation to repay that JobKeeper amount. But, if they do so, then I’m not going to say no. That’s additional money that will flow into the government coffers, and it’s appreciated,” he said.

However, Labor’s Shadow Assistant Minister for Treasury Andrew Leigh told The Guardian that Harvey Norman and Solomon Lew’s Premier Investments (which owns retail chains Portmans, Just Jeans and Dotti) should also return their JobKeeper subsidies.

Leigh said Premier Investments received an estimated $45 million in JobKeeper payments while also paying a multimillion-dollar bonus to its chief executive, The Guardian reports.

Grimmer says firms could face backlash because consumers are increasingly aware of the ethical — or not so ethical — behaviour of businesses in the retail sector.

“There is an increasing consumer awareness around large firms being good corporate citizens. Firms may face backlash if they are seen to be paying executive and shareholder bonuses because of the impact of the support they received from taxpayers,” she says.

“Retail workers are among the lowest-paid workers in the country and it’s not a good look for large retail firms to be, on the one hand, employing people and paying modest wages, and on the other, reaping the benefits of government handouts.”

Funds for struggling businesses

Grimmer says the federal government should consider a special fund that diverts returned JobKeeper subsidies from high-performing companies to smaller retailers that are struggling.

“Rather than going back to the ATO, I wonder if the government would consider a special fund to assist smaller retailers who may be struggling or who will likely face new challenges as government supports are wound back in the next few months,” she says.

“This is certainly an approach that is being called for in places like the UK.”