Underpayments – a risk too great to overlook or ignore

The recent class action brought against Appco, coupled with the recent high profile 7Eleven underpayments scandal highlights yet again the growing awareness of employees as to their entitlements, and an increased willingness to ensure that employers are paying employees correctly.

But there are more important lessons for employers across the all sectors, including the not for profit sector:

1. All Employers need to ensure that the type of relationship with individuals, whether contractor, employee or volunteer is clearly defined and understood by both the employer and the individual.
2. All employers should ensure that they are paying their employees in accordance with minimum pay standards of the National Employment Standards, but as often is the case, in accordance with the relevant Modern Award.
3. In this age of greater scrutiny and an emboldened Fair Work Ombudsman, the Not For Profit sector is not immune from investigations.

A failure to take into account these things could result in actions being brought against your business by either disgruntled employees or the Fair Work Ombudsman for payment of alleged underpayments. In addition, the business, and the individual who is aware of any possible breaches, could also end up being ordered to pay penalties for every breach of the Fair Work Act that is sustained.

How can you avoid underpayments?

In order to avoid this, we recommend that all employers take the following steps:

1. Review and clarify all workplace relationships.
2. Review and clarify all relevant pay and conditions that may govern your workplace relationships.

If you would have concerns about the classifications of people in your workplace and your obligations to them, then please contact Adam Foster or Chris Morey on (03) 9629 9629, so that Lewis Holdway Lawyers can answer your questions.