Super Retail Group: BCF, Rebel settles $50m legal battle with two former staff after sacking CEO

A long-running legal battle that had threatened to cost the company behind household-name brands such as Rebel, BCF and Supercheap Auto up to $50 million has been settled before reaching trial.

The case between Super Retail Group and two former employees centred on claims that an alleged illicit affair between recently fired chief executive Anthony Heraghty and former human resources boss Jane Kelly had created a toxic workplace environment.

Former SRG chief legal counsel Rebecca Farrell and former co-company secretary Amelia Berczelly brought the case in mid-2024, shortly after the company warned it was expecting legal proceedings to be filed by two workers that could result in damages of between $30m and $50m.

The case was due to return to court this week, but in a brief two-paragraph statement issued on Wednesday, SRG revealed a confidential settlement had been agreed.

It did not disclose the sum and said it was made “without any admission of liability for an amount less than the range referred to” in last year’s litigation warning.

Court papers submitted late last year revealed allegations of an “unhealthy culture” that developed as a result of Mr Heraghty and Ms Kelly’s alleged conduct, with SRG’s former chair Sally Pitkin also heavily criticised.

A statement of claim lodged by Ms Farrell alleged staff did not feel they could report concerns about a culture of bullying to the board because Ms Pitkin “is very close to the CEO and (Ms Kelly), and they feel chair Pitkin would somehow sweep such matters under the carpet”.

SRG staff who reported to or worked with Ms Farrell on several occasions from about May 2021 also made disclosures that they were under pressure and unable to do all aspects of their work, the documents said. This caused them stress and risks to their health and safety, it had been alleged.

The case centred on claims the alleged relationship between Mr Heraghty and Ms Kelly was not disclosed, inappropriate company travel and bullying.

It also made allegations of victimisation and adverse treatment, particular employees in the corporate team having unreasonable workloads, insufficient resources and restricted access to information, and unsatisfactory company record management.

At the time, SRG said the board had investigated the allegations.

“The board was supported by independent external advisers. The board’s review and investigations concluded that none of the allegations are substantiated,” it had said.

SRG earlier this year delivered its defence to the claims that contradicted Ms Farrell allegations.

But last week the board revealed it had immediately terminated its CEO’s employment “after receiving new information from Mr Heraghty regarding his relationship with the company’s former chief human resources officer”.

“In light of this new information, the board has concluded Mr Heraghty’s prior disclosures were not satisfactory,” SRG’s board said last Tuesday.

It offered no details on what new information about the relationship prompted its immediate dismissal of the recently divorced chief executive.

Chief financial officer David Burns was appointed interim boss while the company starts a search for Mr Heraghty’s replacement