The recent Woolworths case – and the media and Fair Work Ombudsman’s reaction – highlights how easily and frequently employers are getting caught out and labelled as wage thieves. Will you be next?
Woolworths is just the latest high-profile employer to have underpaid its staff, in this case by hundreds of millions. Though it admitted its breaches, it is facing potential prosecution, which could see it pay massive penalties on top of the estimated $300 million it discovered that it owes its employees.
Woolworths says the error was inadvertent and will be rectified. So said the ABC, Wesfarmers, and business associated with George Colombaris and Neil Perry – and many others. But unions and the media still call it theft.
Rectifying a mistake is no longer good enough. The Fair Work Ombudsman Sandra Parker has been quoted as saying that corporations should pay as much attention to payroll compliance as they do to other business processes.1 Employers are expected to invest in processes that proactively ensure that “errors” do not occur. In a media release published on the FWO website she says companies “must understand that admission is not absolution. Companies should expect that breaking workplace laws will end in a public court enforcement outcome.”
One source of error is that employers negotiate a new agreement but do not put in an implementation change project plan to monitor that changes are done correctly. Another is an assumption by staff that they understand and interpret a clause or entitlement correctly, without a secondary verification from a qualified person.
Require further information/assistance?
EMA Consulting has staff who are experienced at reviewing processes for systematic weaknesses in industrial instrument compliance. We could help your business review its compliance with a comprehensive audit and report.
If you require further information or advice, please contact one of our consultants.
1 See eg The Guardian on line, 3 November 2019