A recent string of surprise visits by the Fair Work Ombudsman (FWO) to a number of farms and labour hire companies throughout Victoria highlights the need for businesses to ensure they are strictly complying with their obligations to employees, including the correct payment of wages.
While these surprise inspections, prompted by reports of underpayments to workers, have been focused mainly on the horticulture sector – this doesn’t mean that businesses in other sectors are immune from inspections – or investigation by the FWO.
In this week’s Akyra blog, we break down why it’s critical for employers to ensure they are meeting their obligations to employees – and outline the risks of non-compliance.
The Fair Work Ombudsman
The FWO is an independent agency of the Australian Government which focuses on workplace relations at a national level, including monitoring and enforcing employers’ compliance with workplace law and the Fair Work Act.
The FWO’s responsibilities are outlined in the Fair Work Act, and their powers include (amongst others) issuing infringement notices and compliance notices to businesses whom they believe to have violated the Fair Work Act or employment law, initiating legal proceedings against businesses and conducting workplace inspections if non-compliance is suspected.
Fair Work Inspectors may enter the premises of a business for compliance purposes – and do not require permission from the business owner.
The risks of non-compliance
For employers found by the FWO to be in violation of the Fair Work Act or employment law, serious penalties can apply. Penalties can be issued in relation to violations such as wage underpayments, violating Modern Award obligations, or breaching record-keeping and pay slip requirements.
The FWO has the power to issue infringements and compliance notices in response to violations of the Fair Work Act. This includes the recovery of wage underpayments to employees. In 2021/2022, the FWO recovered $77,969 in wage underpayments in the horticulture sector alone.
If a business or individual fails to comply with a compliance notice issued by the FWO, civil penalties may be sought, with a maximum of $13,320 per contravention for an individual and $66,600 per contravention for a company.
The FWO recently announced that it had commenced legal action against the holding company Super Retail Group (SRG) Limited and its subsidiaries (Super Cheap Auto, Rebel Sport, SRG Leisure Retail (trading as BCF and Ray’s Outdoors) and Macpac Retail) who have paid salaried employees annual salaries that allegedly failed to cover their minimum entitlements. The FWO’s case focuses on a sample of 146 employees who it alleges were underpaid about $1.14 million between January 2017 and March 2019 – further highlighting the need for employers to ensure they are strictly complying with all aspects of employment law.
Tips to ensure compliance
The best way to avoid trouble is to ensure your business is fully aware of – and strictly complying with – your obligations to employees under the Fair Work Act and other aspects of employment law.
Conducting regular reviews of your obligations to employees under the relevant Modern Awards, including pay obligations, is a great place to start.
If you are concerned that your business may have inadvertently underpaid workers, you may consider utilising the services of Akyra who can assist you in determining whether the wages you pay comply with the terms and conditions of the relevant Modern Award or the National Employment Standards.
Accurate and consistent record-keeping is also essential. This includes employment agreements and pay-slips.
If you are in need of assistance in ensuring your workplace is fully compliant with workplace laws and obligations to employees, contact the team at Akyra for an obligation-free consultation.
Akyra’s key takeaways
- The Fair Work Ombudsman has the power to investigate potential violations of the Fair Work Act and to enforce compliance amongst Australian employers
- This includes the power to conduct surprise visits to businesses which are suspected of non-compliance with the Fair Work Act – particularly in relation to the underpayment of wages
- Violations of the Fair Work Act and other aspects of employment law can lead to severe financial penalties, as well as legal proceedings
- In order to mitigate non-compliance, employers should ensure that they are fully aware of, and compliant with, their obligations to workers under the Fair Work Act
NEED MORE INFORMATION?
Akyra can help your business to assist and support all your questions and concerns related to the Fair Work Act and employer obligations. Please contact Akyra on 07 3204 8830 or book a free 30-minute consultation for an obligation-free conversation.
Disclaimer – Reliance on Content
The material distributed is general information only. The information supplied is not intended to be legal or other professional advice, nor should it be relied upon as such. You should seek legal or professional advice in relation to your specific situation.
https://mk.com.au/fair-work-ombudsmans-surprise-spring-wages-visits-to-victorian-farmers/, https://www.fairwork.gov.au/tools-and-resources/fact-sheets/about-us/powers-of-fair-work-inspectors#what-are-their-powers, https://www.fairwork.gov.au/about-us/our-role-and-purpose, https://www.fairwork.gov.au/newsroom/media-releases/2023-media-releases/january-2023/20230120-super-retail-group-litigation-media-release