In the first use of laws enacted to close a ‘loophole’ in employee underpayment cases, the Fair Work Ombudsman (“FWO”) commenced proceedings against A & K Property Services Pty Ltd (“A & K”) and three of its directors; alleging breaches of the Fair Work Act 2009 (Cth) (“the Act”). The FWO alleges that A & K failed to keep proper time and wage records, failed to issue pay slips, and underpaid nine (9) workers a total of $19,467 in lawful entitlements.
Previously the FWO had faced difficulty in underpayment cases where employers had failed to keep proper books and records, as without such records, underpayment was difficult to prove. While failing to keep proper books and records has always been an offence under the Act, it now also places the onus on the employer to disprove allegations made by the FWO.
In practice, this would likely require the employer to produce the records which would have been required to prevent the burden being placed upon them in the first place. These changes clearly strengthen the hand of the FWO in dealing with underpayment breaches, and in doing so they significantly increase the risk, exposure to liability and legal costs of employers who commit record keeping breaches.
Employers should always be diligent in keeping employee records: useful information on these obligations can be found here.
Accountants and other third party advisors should also be cautious, since as we informed you last year, parties who are involved in a breach of a civil remedy provision can also be liable for that breach.
Gavin Parsons and Associates can assist you with any questions you have regarding your employment law obligations.
Please contact us on (02) 9262 4471 for a free no obligation consultation today.