Have you budgeted for employment governance failures?

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Compliance Failures

The recent news of widespread exploitation in the farms and factories across Australia has turned the spotlight to pay and working conditions in Australian businesses. While we don’t expect that Clubs, Pubs and Hotels will be the subject of the next Four Corners expose, we all need to be vigilant that we are following the rules so we don’t get caught out.

A quick look through the results of the Fair Work Ombudsman investigations shows that all too often businesses are not aware of the many provisions contained within their Awards and Agreements which they are required to abide by. Not understanding and complying with established guidelines or specifications under Australian workplace laws can prove a costly and damaging oversight.

If someone was to put your venue under the microscope, are you confident of what they would find?

In April and May this year alone the Fair Work Ombudsman found numerous businesses both small and large, who had failed to meet their employment obligations. These business felt the sting of these often unintentional mistakes with hefty employee wage back-payments and/or large fines.

  • A large national Aged Care Services Group was recently required to reimburse almost $4.8 million to employees after they discovered and voluntarily reported that they had inadvertently underpaid overtime rates for at least six years. Overall, 24 industrial instruments had been breached in what the Fair Work Ombudsman termed a significant and systematic governance failure.
  • Hospitality as an industry employing significant numbers of overseas workers has been one of many actively targeted in previous years. The Fair Work Ombudsman has dealt with over 6000 requests for assistance from visa-holders and recovered more than $4 million in outstanding wages and entitlements. The highest penalty decision being $343,860 was against a cleaning company in Perth who underpaid overseas workers on 417 working holiday visas.
  • The employer of a Cairns restaurant with 32 staff was found to not comply with workplace laws due to mistakenly paying staff under an incorrect enterprise agreement that did not relate to the business resulting in the back-pay of $24,300
  • Eight staff at a Townsville fast food café shared a $7,600 back payment after it was found the business inadvertently underpaid minimum hourly rates, weekend and overtime penalty rates last financial year.
  • A Victorian transport company was found to have underpaid eight of its truck drivers more than $260,000 after being short-changed a range of entitlements on top of them not receiving severance pay or wages in lieu of notice when they were made redundant. The employer had also breached record-keeping and pay slip laws.

These cases serve as prime examples of the risks of inadequate governance and payroll systems, and highlight the significant results of not completely understanding your obligations to employees under Australian workplace laws.

Do you know if you are in full compliance? Can you afford not to be?

To check if you’re on the right track please email or contact one of our Human Resource experts on (07) 3878 9355.

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