Kathryn’s four tips to avoid an underpayment penalty.
The Federal Government under the Secure Australian Jobs plan intends to criminalise the underpayment of wages.
The changing of legislation and continued scrutiny by the fair work ombudsman means it has never been more important to ensure compliance with your payroll activities.
In a recent video, Kathryn Rees, the South Australian Business Chamber’s Workplace Consultant, and manager of the Business Advice Hotline outlined four tips to ensure you don’t get caught up in an underpayment of wages claim.
1 – Ensure you are paying under the correct industrial instrument. Check if your employees are covered by a modern award, an enterprise agreement, or a contract of employment. If you have employees paid under a modern award or enterprise agreement, you need to ensure they are classified correctly.
2 – Ensure you are paying the correct penalties. Your payroll needs to take any overtime, penalty rates or allowance obligations into account. If you get these wrong, you may be liable for an underpayment claim.
3 – Ensure you are managing your employees’ hours of work and breaks. If you have employees not taking meal breaks, this could be in breach of their award or enterprise agreement, even if they have requested they do not take a meal break, to, for example, leave early.
4 – Conduct regular payroll audits. Doing this helps you to keep abreast of your rates of pay, how you are paying, and keeping an eye on allowances. By undertaking regular check-ins, if you do find a mistake, it not going to be a lengthy process to make a correction before it has the potential to escalate.
If you have any questions regarding any of these points, our Business Advice Hotline is available free of charge to members of the South Australian Business Chamber at the Start-Up, SME, and Corporate levels.
For more complex matters, our team of consultants are available for fee-for-service one on one sessions where we can provide a complete review of your business’s industrial policies and procedures. You can find out more here.
