Category: Compliance

Employer told to update “weak” policies after an investigation by Fair Work

The Metropolitan Fire Brigade (MFB) was told to review its recruitment and conflict of interest policies and practices, after a senior manager engaged in “blatant” nepotism.

An investigation found the MFB chief information officer engineered a recruitment process to ensure both her sons were hired, after she falsified their CVs, coached them prior to the interview, and got them to change their names to conceal the relationship. She even offered one of her sons a pay increase and moved him into a permanent role.

In a report into the allegations, Victorian Ombudsman Deborah Glass found this was “a case of deception where the family nest was feathered, plain and simple” and said even the most robust policy would not have prevented the level of deception shown by each of the subjects.

However, she found the MFB’s conflict of interest policy to be “profoundly deficient”, saying it “fails to acknowledge the potential for conflicts to exist during recruitment”.

Ombudsman Glass said while the employer in this case could not be held responsible for the deception perpetrated upon it, its conflict of interest policies were weak, and did not reflect best practice.  She said “…..leaders must ensure they create an environment in which conflict of interest policies are embedded in their organisational culture.”

If you need to check your policies and procedures you should seek some HR advice from a professional as soon as possible to figure out your next steps forward.

Key message

Fair Work investigations can happen at any time to any business no matter the size.  Is your business compliant? Get in touch with us to ensure you have the right policies and practices in place to pass the compliance test.

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Employment contracts: friend or foe?

How solid are your employment contracts?

The importance of having employment contracts in place is generally understood.

However, time constraints, multiple priorities or a lack of support or knowledge in this legislative space can sometimes lead to incomplete, inaccurate, non-compliant or insufficient contracts that can expose a business to multiple disputes or claims.

Our team member, Lynn Ross, was involved in a dispute resolution process at the Fair Work Commission, defending the employer/business against a breach of contract claim made by an employee.

The case

An editable version of an employment contract was emailed to a potential employee. The employee changed the wording on the contract to avoid repaying relocation costs back to the business if he resigned within a particular period of time. The contract was then signed by the employee and emailed back to the employer without any discussion or comment of the changes made by the employee prior to signing the contract.

The employee resigned shortly after and refused to repay the relocation costs siting the wording on the contract. When the business deducted the amount owing from the employee’s final pay, the employee lodged a claim with the Fair Work Commission for breach of contract.

Lynn represented the employer at the Fair Work Commission proving all necessary evidence of the incident and the employee’s breach of the company code of conduct and values. The case was quickly settled in favour of the business.

What can you do to protect your business?

Understanding and executing legislative obligations is critical to the operations of any business, especially when it comes to having the right employment processes, policies and contracts in place.

There are a number of tools and templates available to help you make sure you’re using compliant documentation (we have an HR fundamentals toolkit for example, that includes five hours of phone advice with an HR manager to help you solve situations that aren’t as straight forward).

Businessary can help you take a proactive approach in managing your business and employees – give us a call and lighten your load.

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phone  03 9662 9900

Another small business faces legal action for exploitation

The Fair Work Ombudsman has started legal proceedings against the owner of the Melbourne burger bar, Burger Buzz, for apparently failing to back pay seven former employees who were underpaid over $7000 for work performed early last year.

Over half of the individuals were overseas workers on working holiday visa, and two of the individuals were just 19 years old.
Exploitation, law, court, legal, hearing
The company was issued with seven compliance notices requesting back payments be made, however failure to comply meant that the Fair Work Ombudsman were left with no choice but to commence legal action.
Owner, Todd, Patrick Buzza, and Company also failed to comply with three notices to produce employment records and allegedly breached workplace laws relating to payslips.

This does not appear to be the first time that Burger Buzz has had allegations of underpayment, as in 2014 Fair Work formally advised My Buzza of his minimum pay obligations on at least two occasions. Also facing Court is Mr Buzza’s company Rum Runner Trading Pty Ltd.

Mr Buzza could potentially face maximum penalties from $5,400 to $10,800 per contravene, and Rum Runner Trading Pty Ltd faces penalties of up to $27,000 to $54,000 per contravention. The hearing is scheduled for Federal Circuit Court on July 19 in Melbourne.

Fair Work to conduct national review

The Fair Work Ombudsman is conducting a national review of the wages and conditions of overseas workers in Australia on the 417 working holiday visa after receiving allegations that some unscrupulous operators may be guilty of backpacker exploitation.

The Fair Work Ombudsman recovered more than $2.2 million in underpaid wages and entitlements for 513 visa-holders from disputes completed by the Agency last calendar year – an average of $4317 each.

Read the full Fair Work media release here.

Fair Work spot checks – results are in!

The Fair Work Ombudsman has just released results of spot checks on record keeping practices of business throughout Australia that were conducted during 2014 and 2015.

2Fair work spot checks, well done, applause014-2015 Fair Work spot checks

Over the two year campaign period, the Fair Work Ombudsman audited 1,376 employers across Australia and found that 72% of business were compliant with record keeping and payslip obligations.

This was a pleasing result for Fair Work, demonstrating the willingness of Australian business to do the right thing by employees and ensure compliance.

Costly exercise for nearly 30% of non-compliant

However, for the 28% of business that were found to be non-compliant, 46 employers were instructed to back pay a total of $620,023 to 336 employees who were found to be underpaid entitlements.

In addition to the back payments, two businesses were issues with cautions and were put on notices, in which any further or future breaches could potentially result in enforcement action.  These business will need to ensure they remain their new found compliance as Fair Work advised that business whom were found to be non-compliant will be reaudited as part of the ongoing National Compliance Monitoring Campaign.

The commendable thing about this Fair Work education and compliance campaign is that the agency is aiming to help businesses.  Fair Work inspectors are offering tailored assistance to rectify non-compliance issues and assist businesses in putting processes in place to ensure business stay compliant.  They are focused on educating business to understand what their workplace obligations are and what assistance and resources are available to them.

Fair work spot checks campaign continues in 2016

Fair Work inspectors are still out in the field auditing businesses through out Australia, so make sure you are one of the compliant ones!

Stay tunes for the findings of the 2016 campaign…

Minimum wage and high income threshold set to increase July 1 2016

The Fair Work Commission has announced that the minimum wage and high income threshold will increase on 1 July 2016, as part of the annual minimum wage review.

The announcement was made that minimum wage is set to increase by 2.4%, which for employers, will mean that effective the first full pay period from 1 July 2016, the minimum weekly wage will increase from $656.90 to $672.70, and as an hourly rate increase from $17.29 to $17.70.  This 2.4% increase will also be applied to modern award rates.

This increase will only apply to employees who are paid according to the national minimum wage, a modern award, or an applicable registered agreement. Most employees will be covered by an award, however if they are not covered by an award or agreement, then they would be covered by the national minimum wage.

Review your minimum wage obligations

It is important that businesses review the wages and salaries of their employees to ensure they are meeting minimum wage obligations in either the national minimum wage or modern award.  To help employers make sure that are applying the correct new rates, the Fair Work Commission are currently in the process of updating their pay tools with the new pay rates which will be made available online to employers to utilise.

As for the high income threshold, this is set to increase from $136,700 to $138,900.  High income employers are not covered by modern awards, however, with the announced increase of over $2,000 to the threshold, it is also important for businesses to also review if any employees who may have previously not been covered, may now be covered due to the increase.   For those employees, it is important to ensure you are meeting your employer obligations to your employees under any awards they may now be covered.

One thing not increasing for employers in the new financial year is the superannuation guarantee rate, which remained at 9.5% for 2015/16 and will continue to remain at 9.5% for the 2016/17 financial year.

Stay tuned for the Fair Work Commission pay rate tools update!

Have you taken the new Fair Work quiz?

With the crackdown in 2016 by the Fair Work Commission on businesses meeting their obligations to employees, you cannot afford to not know what your obligations are.

The Fair Work Ombudsman website has a great online ‘Workplace Basics’ quiz that is a quick and free way to test your workplace knowledge about everyday workplace issues.

It is a multiple choice quiz that consists of six core areas – pay and awards, leave, types of employment, recording keeping and payslips, flexible work and work life balance, termination including redundancy, disputes and grievances.

The quiz focuses on helping both employees and employers test and improve their knowledge of workplace rights and compliance with the workplace obligations.

Take the Fair Work quiz

Want to test your knowledge? Take the quiz now.

Employer compliance ‘spot checks’ across Australia

As part of a new campaign focusing on checking whether employers are compliant with both their employee obligations as well as employer record-keeping obligations, the Fair Work Ombudsman has been announcing ‘spot check’ audits over the last few months on businesses throughout Australia.

Compliance spot checks coming to a region near you

In March this year, the Fair Work Ombudsman announced that 50 Tasmanian and 200 Southwest Victorian business would be audited.  It was also announced that 30 Alice Springs and Barkly region businesses would be audited in April, 50 Brisbane and 75 Barossa and Adelaide Plains regions business would be audited in May and this month it was announced that 150 regional Western Australian business and 250 New South Wales business would be audited as part of the campaign.

As part of these random checks, Fair Work inspectors will audit businesses to ensure employers are paying the correct minimum hourly rates, penalty rates, allowances, loadings, overtime and providing appropriate meal breaks. They will also be checking to ensure adherence to record keeping and payslip obligations.

How would your business stand up against a Fair Work compliance ‘spot check’?

For many businesses, this will mean a mad scramble to find out what their obligations are and try and backtrack ASAP!  Some may have processes and procedures in place and be unaffected by an audit, while others may unfortunately be caught unawares and potentially suffer the consequences ranging from cautions, repaying underpayments and fines.

With the knowledge that Fair Work is door-knocking, now is the time to make sure that all your ducks are lined up and you are meeting your employer obligations. This is especially important with year end looming and the changes to pay rates and thresholds on July 1 2016.

Not sure if you are compliant? We can help you! Contact us on 03 9662 9900.