More than $580,000 in underpayments affecting almost 1,000 employees have been found by the Fair Work Ombudsman following a series of surprise audits that it said revealed “widespread non-compliance” with workplace laws.
The Fair Work Ombudsman (FWO) said in a statement that its investigators had recently done surprise visits to 1,385 businesses across NSW, Queensland and Victoria.
These audits targeted Latrobe-Gippsland, Shepparton, the Southern Highlands, Shoalhaven, Wide Bay and Ipswich and looked at a varied range of industries, with particular scrutiny given to retailers and accommodation and hospitality operators.
“Inspectors found 22 per cent of all audited business failed to pay their employees correctly,” it said.
“[In addition,] 15 per cent were in breach of non-monetary obligations by not providing proper payslips or keeping proper employment records, and 6 per cent failed to both pay their employees correctly and meet their non-monetary obligations.”
According to the FWO, these underpayments collectively totalled more than $580,000 – or an average of around $600 per affected employee.
The bulk of the underpayments was attributed to shortfalls of the minimum hourly rate, while below-mandated penalty and overtime rates were also discovered.
Some 27 on-the-spot fines were issued, with penalties totalling 5,960, for breaches of payslip and record-keeping rules. A further 39 cautions were also issued.
The FWO said that compliance rates were broadly similar in each of the locations targeted, which looked like this:
- 52 per cent of the 262 businesses audited in Shepparton, Victoria
- 59 per cent of the 364 businesses audited in Latrobe-Gippsland, Victoria
- 55 per cent of the 338 businesses audited in the Southern Highlands and Shoalhaven, NSW
- 57 per cent of the 212 businesses audited in Ipswich, Queensland
- 63 per cent of the 209 businesses audited in Wide Bay, Queensland
‘Unacceptable’, says Ombudsman
Ombudsman Sandra Parker (pictured) described the results of the audits as “unacceptable”.
“Fair Work inspectors targeted specific regions after employees contacted us for help, many of whom could be vulnerable to workplace exploitation due to their youth or visa status,” she said.
“It is unacceptable that almost half of the businesses we visited were simply unaware of their obligations under workplace laws and were not paying the lawful minimum hourly wage.”
Ms Parker added: “The FWO will revisit these businesses as part of our ongoing national proactive compliance monitoring programs. Appropriate compliance and enforcement action will be used against employers who continue to breach workplace laws.”
She urged all employers to check that their payments to workers satisfied the relevant workplace laws.
“The Fair Work Ombudsman provides free assistance to employers, so ignorance is never an excuse for underpaying your staff,” said Ms Parker.
“This outcome is an important reminder to businesses that they must have robust processes in place to ensure they’re complying with workplace laws. Any employers with concerns should contact us before we conduct a surprise visit to their premises.”
The FWO’s announcement comes at the same time the Tax Office unveiled that its next round of site visits would target businesses – and their accountants or tax agents – in particular industries across three states and territories.
Adam Zuchetti is the editor of My Business, and has steered the publication’s editorial direction since early 2016.
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