Monday 21 August - Creating Confidence In How People Are Paid

Payroll Reminder: Changes to The Professional Employees Award 2020

The new changes to the Professional Employees Award 2020 from the 16 September 2023 will change the way some employers will pay and monitor their employees’ work hours. It’s a stark reminder that all employers need to keep up to date with their legal obligations.

• Between Monday to Saturday, a penalty rate of 125% applies for hours worked overtime (before 6:00am and after 10:00pm)
• Sundays and public holidays accrue a 150% penalty rate
• Casual employees are also entitled to a 25% loading on top of their usual pay
• Employers need to keep records of all their employees’ hours worked which exceed the usual 38-hour week

These changes do not impact employees who have a salary of more than 25% the minimum wage for their employment

Action Items:

• Review your employees who are under the Professional Employees Award
• Review who have a salary more than 25% of the award minimum wage
• Look at how you are going to capture hours that are outside 38 hours

A deep dive into the enforceable undertaking

Best & Less, a familiar name in the Australian retail landscape, found itself in the limelight for payroll discrepancies that affected its workforce. The company entered into an enforceable undertaking (EU) with the Fair Work Ombudsman, showing the regulatory body’s commitment to ensuring employees receive their correct entitlements. This article delves into the specifics of this case and highlights the broader implications for Australian businesses.

Background of the Case

Best & Less self-reported underpayments that affected several of its employees. After conducting an internal audit, it became clear that there were systematic failures in their payroll processes, leading to miscalculated payments spanning several years. While self-reporting reflected a sense of corporate responsibility, it brought the question of how such errors went unnoticed for so long.

Key Provisions of the Enforceable Undertaking

1. Reparation: Central to the EU was the commitment by Best & Less to rectify the underpayments in full. This included not just the basic salaries but also interest and superannuation where applicable.
2. External Auditing: Best & Less agreed to engage external auditors to review its compliance with the Fair Work Act, ensuring no further discrepancies would arise in the future.
3. Public Apology: Demonstrating genuine remorse and acknowledging wrongdoing, the company was required to issue a public apology to its affected employees, reinstating trust and reaffirming its commitment to fair work practices.
4. Training and Compliance: As part of the EU, the company pledged to invest in comprehensive training programs for HR and payroll staff, ensuring they are abreast with the latest in work rights and payment regulations.

Implications for the broader business community

The Best & Less case isn’t just a singular instance of payroll discrepancy. It serves as a reminder for employers across Australia on the importance of robust payroll systems and processes.

1. Self auditing is crucial: Proactive?payroll audits?can help businesses identify and rectify payment errors before they escalate into larger issues. Regular checks ensure compliance with changing regulations and safeguard companies from potential legal complications.
2. Transparency is key: In instances where discrepancies are identified, transparent communication with affected employees can help in rebuilding trust. Being open about the steps being taken for rectification can alleviate concerns and potential reputational damage.
3. Continuous training: The landscape of payroll and entitlements is ever evolving. Businesses must ensure their payroll and HR teams undergo regular?payroll training?to stay updated with the latest regulations.
4. Repercussions of non-compliance: EUs, like the one Best & Less entered into, are legally binding. Non-compliance can lead to further legal action and substantial fines. Beyond the financial implications, the reputational damage can have long-term consequences for brand image and trust.

Conclusion

The enforceable undertaking between Best & Less and the Fair Work Ombudsman underscores the essential nature of payroll compliance. While the company took responsible steps to rectify its errors, the case serves as a reminder to employers to ensure their payroll systems are foolproof, transparent, and in line with the?latest regulations. As the adage goes, “prevention is better than cure,” and in the realm of payroll, this couldn’t be truer.

Superannuation Update: Right to superannuation in the National Employment Standards.

From 1 January 2024, the National Employment Standards (NES) will include a right to superannuation contributions. This means that unpaid or underpaid superannuation can be enforced under the Fair Work Act by more employees.).

Employers already have an obligation to pay superannuation contributions for eligible employees under superannuation guarantee laws. There would be no contravention of the NES provision where an employer has met their obligations under these laws.

The Australian Taxation Office (ATO) will continue to have the main responsibility for ensuring compliance with employer obligations under superannuation guarantee laws. The Fair Work Ombudsman can continue to make referrals involving unpaid superannuation to the ATO.

By bringing the right to superannuation into the NES, workers will have the right to directly pursue superannuation owed to them. Employers may also face civil penalties if they do not comply with the entitlement.

Penalties of up to $82,500 per breach apply to companies that are found to have contravened the NES.

Click Here for more information

Australian Payroll Summit - Melbourne (Tickets on Sales)

Don't Miss Out! Early Bird Tickets Now On Sale!

Join us and 250+ industry peers at the 2023 Australian Payroll Summit in #Melboure on Friday, October 27th.

Expert Insights Await You!

Australian Taxation Office | Same Day Super Update

• Fair Work Ombudsman | General Update
• Rankin Business Lawyers | Demystifying The Wage Theft Act
• Digital Service Providers Australia New Zealand (DSPANZ) | Unlocking The - - - Power of Collaboration with Government Software Partnerships
• Australian Payroll Association | Legislation & Compliance Update

Dive into the Full Agenda:?https://lnkd.in/gqzmv749

Bring Your Team and Save!

Book now with code 3FOR2 to secure 3 tickets for the price of 2. An opportunity like this is too good to pass up!

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Did you know - Superannuation

Did you know that if you underpay super for quarter, the super shortfall is calculated on the employees total salary and wages (including overtime) and not on the employees OTE?

Australian Payroll Association & UTS

Australian Payroll Association is delighted to be partnering with?UTS Master of Data Science and Innovation iLabs projects. During the project three teams of students will be tackling the widespread?issue of underpayment facing many of our international students and migrant workers.?

Did you know that in 2022, 5% to 16% of employed recent migrants were paid less than the national minimum wage. Source: Grattan Institute.

The teams will be applying diverse technical?approaches?to the problems?(visualisations, predictive analysis, deep learning, text mining, etc.) to come up with potential directions and solutions for this widespread challenge.?

Payroll Training Courses

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Payroll Jobs

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Australian Payroll Association | Australian Payroll Talent

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