Employers fined & ordered to repay underpayments

The Fair Work Ombudsman, the watchdog to the new Fair Work Act 2009 that commenced operation on 1 July 2009, is taking no prisoners in its fight to uphold workers’ rights and to recover underpayments of wages and other employee benefits against employers across Australia.

The Fair Work Ombudsman has, in recent times, recovered tens of millions of dollars for thousands of Australian workers from their employers, both past and present.

In addition, the Fair Work Ombudsman has imposed significant monetary penalties against employers who have not properly paid workers in accordance with applicable award conditions and the law.  Penalties imposed often dwarf the underpayment breaches and can be levied against both the employer and its directors.

In our experience, most employers do not underpay deliberately – they are often guilty of nothing more than using incorrect and outdated employment contracts and ignorance of their legal obligations.

This trend is set to continue as employers continue to grapple with the new legal requirements of the Fair Work Act 2009.  From 1 January 2010 most employers will face new modern award coverage in their workplace and the introduction of the new National Employment Standards that will lead to greater ignorance and underpayment claims.  We expect underpayment claims to rise significantly over the next 12 months.

In addition to enforcing compliance of Australia’s new workplace laws, the Fair Work Ombudsman is mandated to advise and assist workers understand their workplace rights and responsibilities.   We expect worker awareness of their new rights under the Fair Work Act 2009 to increase over the next 12 months due to both the efforts of the Fair Work Ombudsman and the union movement through planned media campaigns due to commence shortly.

View the Fair Work Ombudsman website at www.fwo.gov.au.

Our Worklplace Relations Team can answer your questions in relation to award payments.

Author:  Herbert Fischbacher