Brandon Rigger, senior employment relations adviser at Employsure, echoed previous reminders to the business community that from Monday, 1 July, the minimum wage and award wage rates will increase as per the Fair Work Commission’s recent ruling, while undeclared cash payments to employees and contractors will no longer be tax-deductible.
However, he also said that in certain industries, some penalty rates will actually be reduced.
“The reduction of public holiday penalty rates applies to the following Awards: Hospitality Industry (General) Award 2010, Restaurant Industry Award 2010, General Retail Industry Award 2010, Fast Food Industry Award 2010 [and the] Pharmacy Industry Award 2010,” Mr Rigger said.
Last year, the Fair Work Commission introduced staged reductions to Sunday penalty rates in the retail sector over three years, which ultimately will come down to 170 per cent for full and part-time employees and 200 per cent for casuals from 1 July 2020.
The first of these changes took effect from 1 November 2018.
These reductions, however, were offset by modest increases to penalty rates for Saturdays and evening hours, it said at the time.
“It is so important for small business to be across these changes,” Mr Rigger said.
“Workplace compliance can feel like a minefield, and it is essential to get the right advice to avoid paying too little or too much.”
Retail union slams ‘unfair’ cuts
Unions have hit out at the cut to penalty rates, which SDA national secretary Gerard Dwyer called “unfair”.
“Retail and fast food workers have already had two cuts to their Sunday penalty rates and public holiday rates were slashed in 2017.”
“Given these are some of the lowest paid workers in the country, these [latest] penalty rate cuts for retail, fast food and hospitality workers are extraordinarily unfair.”
Mr Dwyer added: “With wage growth at historic lows it’s clear that workers and their families simply don’t have the money to spend on anything other than the bare essentials.”
Individuals increasingly being held to account
A separate alert to employers was issued by dVT Group, which noted that authorities are increasingly holding individual directors, as well as companies, to account for underpaid wages. It also warned the complexity is amplified for employers that use multiple awards to pay workers in different roles.
In a post on its website, dVT said that high-profile cases of wage underpayments have put workplace laws firmly in the spotlight.
“The outcome of cases such as the 7-Eleven underpayments have created an awareness of these workplace compliance issues, but it seems to us that it is now dawning on businesses that they, too, could be in the same position,” it said.
“Not necessarily because of deliberate underpayment or false records, but through the devilish detail of compliance.”
The company noted that despite attempts in recent years to simplify the Fair Work Act, “we are still dealing with over 120 modern awards and legislation that have more than 850 sections and amendments”.
Employers are also being warned that individuals are increasingly being held to account, rather than just the business itself.
“Recent court decisions confirm that accessories to these underpayments can also be liable to compensate the claimants — so it’s no longer just about fines and penalties but also some serious financial liability,” dVT said.
“Clearly, personal liability of directors and officers is increasingly the objective of the Fair Work Ombudsman. The FWO’s 2017–2018 annual report indicates that the FWO has continued to pursue its objective of targeting individuals involved in underpayment claims.”
To avoid falling foul of the law, the firm is urging all employers to refamiliarise themselves with the relevant awards under which they employ workers, noting that ignorance does not stand up as an excuse.
“Now is the time to assess your business (or that of your clients) and ask:
- Is the business in a high-risk area — e.g. does it have numerous employees at different levels of employment?
- Do I really understand the multiple award(s) that apply to those employees?
- Have I applied the award correctly and am I paying my employees correctly in all instances?
- If there is something wrong, what might be the implications?”
Information about the penalty rate changes for each industry award can be found on the Fair Work Ombudsman’s website.