Understanding Wage Compliance

Are you prepared for the Fair Work Minimum Wage Increase? Each year in June, the Fair Work Commission hands down the minimum wage increase across Australia. You are probably aware this increase is also passed on to all Modern Awards which of course applies to a significant number of employees Australia wide. Over the past 5 years we have seen the following increase

  • 2013 – 2.6%
  • 2014 – 3%
  • 2015 – 2.5%
  • 2016 – 2.4%
  • 2017 – 3.3%

So what does that mean for 2018? As to the actual percentage increase, that is up to the Commissions Expert Panel. They review and consider a number of social and economic factors and their relationship to the minimum wage. One thing is for certain, minimum wages will increase for those strictly paid the minimum wage as per a Modern Award. 

Now is the time to check how compliant you are with the Award/s that are represented in your business through a wage compliance. Why conduct this check? In the scariest of terms the failure of a company in not paying their staff correctly, or not agreeing to terms of employment in writing, can result in fines of up to $63000 for the business and $12600 for individuals (e.g. Directors/Owners/Managers) as well as common law claims brought against the business by employees to pay outstanding entitlements.

4 quick tips for checking compliance!

There are a number of factors that will affect whether the wages you pay your employees is compliant:&nb

  1. What Award do you pay under (if any)? This question can be determined by a number of factors but a good place to start with is ‘what is my industry and what work do I predominantly conduct?’
  2. What classification are my employees required to operate at? Are they labourers or tradespersons; administrators or managers?
  3. How many man hours do they work per week? Are your standard hours 38 per week or 50 and is that paid at a flat rate or is overtime calculated separately?
  4. What allowances am I required to pay under the Award? Do you supply tools, are they required to wear a uniform, do they need to use their personal phone for work business? 

Once you have answered these questions you then need to review your appropriate Award and confirm you are compliant. At the end of the day it is a requirement to ensure your staff are paid correctly and these questions are a great place to start.  If this is a bit much for you or you are simply time poor, we at Focus HR can assist with all things HR, WHS and Strategy and most definitely Wage Compliance! Unsure about your looming liability and would like peace of mind heading in to the new year financial year, contact Focus HR today on (07) 4765 3456.