What Business Owners need to know about Wage Theft Laws

Posted on 18 February 2025 | by Allan Hall

New Wage Theft Laws: Criminalisation of Wage Theft

On 1 January 2025, new laws came into effect which criminalises intentional wage underpayments. It is now more critical than ever for businesses to ensure compliance!

Here’s a practical breakdown to help you navigate these changes.

What’s New?

Wage theft has always been illegal, and those caught have always faced hefty fines. However, the government has now introduced more stringent penalties, such as even heftier fines, and for those extremely serious cases, criminal sanctions now apply, such as imprisonment.

What the Law Covers

The new legislation, part of the Closing Loopholes amendments and the Fair Work Act 2009, makes intentional underpayment of wages or entitlements a criminal offense.

This targets employers who knowingly underpay employees, for example:

underpaying for hours worked,
not compensating for overtime, and
withholding entitlements

Penalties for Non-Compliance

The consequences of intentional wage theft include:

Corporations: Fines up to $7.825 million or three times the underpayment amount
Individuals (Directors/Managers): Fines up to $1.565 million or three times the underpayment amount
Severe cases: Up to 10 years imprisonment.

Small Businesses

It is important to note that small businesses (those with fewer than 15 employees) are currently excluded from criminal penalties. However, all businesses should address errors promptly to avoid escalating risks.

Intentional versus Unintentional (‘Honest Mistakes’)

These new laws are targeted at those employers who are caught underpaying their staff in an intentional or deliberate manner. Honest mistakes (such as an accidental payroll error, or misinterpretation of an award entitlement) are exempt from the offence and there will be a clear distinction between genuine errors and intentional wage theft.

However, businesses should be aware that even unintentional underpayments can lead to increased civil penalties if they remain uncorrected. Repeated mistakes could be interpreted as negligence, resulting in:

civil penalties of up to $469,500
for serious breaches, Employers may face fines which can escalate to almost $4.7 million, and
applicants can now seek a remedy which is three times the amount of the underpayment.

What should Businesses do to address this?

Our team at Allan Hall HR has a wealth of experience in payroll legislation, employment contracts and payroll audits. We can help you to:

Understand Legal Obligations: Business owners should familiarise themselves with relevant employment laws, including minimum wage requirements, overtime pay regulations, and entitlements under fair work instruments such as awards or agreements.
Conduct regular Payroll Audits and Reviews: Conduct regular internal or third-party payroll audits of payroll records and employee contracts to ensure accuracy in wage payments. This can help identify any discrepancies or potential areas of non-compliance.
Act Quickly on Discrepancies: Resolve underpayment issues immediately to avoid escalations.
Invest in Proper Training: Ensure that staff responsible for payroll and human resources are adequately trained on wage laws and regulations. Provide ongoing education to keep them informed about any updates or changes in legislation.
Implement Clear Policies and Procedures: Establish clear policies and procedures for wage calculation, including overtime, leave entitlements, and superannuation contributions. Make sure employees are aware of their rights and how to report any concerns regarding wage payment.
Keep Detailed Records: Maintain accurate and detailed records of employee hours worked, wages paid, and any additional entitlements. This documentation can serve as evidence of compliance in the event of an audit or investigation.
Promote Transparency and Communication: Foster a culture of transparency and open communication within the organisation. Encourage employees to raise concerns or questions about their wages without fear of retaliation.

Businesses can avoid costly fines and reputational damage by prioritising compliance. Investing in robust payroll processes, training and regular payroll audits is not just about meeting legal obligations, it is also about fostering a culture of accountability and trust in your business.

If you have concerns about paying your workers less than they’re legally entitled to, then contact our team of experienced HR consultants today! We have a wealth of experience in this area and can assist.

Need Assistance?

At Allan Hall HR, we have a team of experienced HR consultants. To learn more about our services, please click here. Alternatively, please feel free to call us on 1300 916 764 or contact us here to discuss any questions you may have with us in regard to wage compliance.

HR Support Centre Demo

We invite all our clients to explore our complimentary HR Support Centre, designed to help you navigate your employee obligations and stay updated on legislative changes. This valuable resource offers ready-to-use HR templates, best practice guidance, checklists, and access to a vast library of articles on compliance and employee management. Book in a free demo today.

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audits, compliance, contractors, employer, entitlements, HR Services, human resources, legislation, payroll, small business, wages

Supporting your employees’ mental health

Posted on 13 February 2025 | by Allan Hall

Do you know your obligations?

Changes to Work Health and Safety legislation and new Respect at Work legislation in Australia have significantly increased employer responsibilities regarding workplace sexual harassment and discrimination.

Legislation now requires employers in all businesses to shift from a reactive response to take proactive steps to prevent harm to their employee’s mental health, including actively preventing sexual harassment, discrimination, bullying and other psychosocial hazards.

However, recent data highlights that many employers still fall short of meeting their obligations:

Safe Work Australia’s Key Work Health and Safety Statistics for 2024 show that:

mental health conditions now account for 11% of all serious workers’ compensation claims.
time lost from work in these cases is more than 5 times higher than other injuries and diseases.

A survey by Our Watch reveals some alarming gaps in workplace awareness:

40% of workplace leaders are unaware of their legal obligations.
Only 76% realise what is classified as sexual harassment, indicating a need for better education and action.

Data from the Workplace Gender Equality Agency (WGEA) also indicates that while 99% of employers have formal policies, 28% are not monitoring incidents of sexual harassment.

The SpeakingOut@Work report, commissioned by Australia’s National Research Organisation for Women’s Safety (ANROWS), has found:

77% of LGBTQ young people surveyed reported experiencing workplace sexual harassment, often directly tied to their LGBTQ identities.
70% of LGBTQ young people experienced behaviours they felt were inappropriate, unwelcome, and targeted based on their sex, gender, or sexuality, but were unsure if these constituted sexual harassment under the law.

The above statistics highlight that, although the work health and safety legislation and Respect@Work reforms have been in place for some time and apply to all businesses, more action needs to be taken by employers.

Why take action?

To ensure your organisation does not become part of the statistics reflecting poor workplace culture and to avoid potential claims, it is critical to assess your risk and take appropriate action.

Legal Ramifications of Non-Compliance

Should your organisation be in breach of workplace health and safety laws, significant penalties may apply. Breaches of anti-discrimination and workplace harassment laws can result in claims, substantial fines, legal fees, and damage to your organisation’s reputation.

Employees who experience harassment or discrimination could lodge workplace complaints, leading to investigations and potential legal action. In some cases, unresolved or mishandled complaints may escalate to tribunal or court proceedings, where damages awarded to employees and associated legal costs can be substantial.

In addition, a failure to address these issues can harm your brand, reduce employee morale, and increase turnover, further impacting your organisation’s bottom line.

The Importance of Respect in the Workplace

Creating a safe and respectful workplace is not just about avoiding legal or financial ramifications—it’s about fostering a positive culture where employees feel valued, safe, and empowered. Organisations which have taken proactive measures to prevent discrimination and harassment and to build a supportive workplace are more likely to attract and retain top talent, build better team collaboration, and boost overall performance.

By addressing any gaps and prioritising inclusivity, employers can meet their legal obligations while fostering a workplace culture of respect, safety, and equality.

Practical Steps for Small Businesses to comply with the new Work Health and Safety and Respect@Work Legislation

If you have not yet taken essential steps, such as updating your policies and providing training to your staff following the changes, your employees and business may be at risk. To learn more about the steps your business can take to comply with the new work health and safety and Respect@Work legislation please read our previous article by clicking here.

Need assistance?

At Allan Hall HR, we have a team of experienced HR consultants who can support your business with meeting its compliance obligations and assist to create a positive workplace culture. To learn more about our services, please click here. Alternatively, please feel free to call us on 1300 916 764 or contact us here to discuss any questions you may have.

HR Support Centre Demo

CONTACT ALLAN HALL HUMAN RESOURCES

compliance, employer, HR Services, human resources, legislation, mental health, small business, WHS

Getting Ready for the Festive Season

Posted on 4 November 2024 | by Allan Hall

What Businesses Need to Know

As we quickly approach the end of year, it is important that Employers begin preparing for their end of year shutdown period.

Over recent years there have been a number of changes to employment legislation that apply during this period, and it is important that Employers are aware of these changes.

1. Managing Employee Leave

If Employers are planning to shut down over the December/January period, managing Employee leave balances should be considered. As of 1 May 1 2023 both Award-covered and award-free Employees can be directed to take accrued annual leave during a ‘shut down’ period, such as between Christmas and New Year.

However, for any Employee who does not have accrued annual leave to cover the shut-down period, they cannot be directed to take unpaid leave.

An employer and employee can:

agree in writing for an employee to take a period of unpaid leave; or
come to an arrangement, agreed in writing, for an employee to take annual leave in advance, resulting in a negative annual leave balance.

If an employee does not agree to either of the above, they should either be paid their salary/wages based on their employment contract during the shut-down period, or alternatively, you could allow them to work during the shut-down period.

What can Employer’s do to avoid this? Employers should be conscious of whether or not to approve annual leave requests prior to the shutdown period, to ensure that there is a sufficient balance to cover the shutdown period. If required and agreed to, employees could take a period of unpaid leave throughout the year at their request.

2. Notice of Shut Down

In addition to the changes above, there are also updated rules in many Awards regarding the notice to Employees of an upcoming shut down. Employers must provide at least 28 days’ written notice of the temporary shutdown period to all impacted employees.

Employers should check the relevant Award and communicate the planned shut down in line with the Award guidelines.

3. Working on Public Holidays

For Employers that continue to operate over the festive season, the Fair Work Act stipulates that Employers are obligated to ‘request’ Employees to work on a public holiday before requiring them to do so. Failure to adhere to this requirement could lead to unlawful work assignments and violation of the Fair Work Act.

For an Employee to work on a public holiday, one of these conditions must be met:

an Employer has requested the Employee to work the public holiday, and the Employee has agreed to work; or
the Employee’s refusal to work a public holiday is deemed unreasonable.

Employers shouldn’t rely solely on standard rostering practices for public holidays and the following actions are recommended:

Issue a ‘draft roster’ for periods including public holidays, or issue specific requests to team members to work on upcoming public holidays
Provide an explanation as to why you believe the need for the team member to work on the public holiday is reasonable
Provide Employees with the opportunity to agree to work or state their reasons for refusal
Finalise the roster based on Employee responses and consider reasons for refusals
Communicate with Employees if their reasons for refusal are considered unreasonable.

4. Penalty Rates

If Employees agree to working on public holidays, it is important for Employers to be aware of the penalty rates and entitlements that apply to them under the relevant Award. This may include:

Additional pay (different to their standard hourly rate)
An additional day off or additional annual leave
Minimum shift lengths on public holidays
Options for Employees to request to substitute a public holiday for another day.

Employers should review the relevant Award and ensure all entitlements and correct rates are paid to Employees. We also have included below the 2024 public holiday dates that apply in all states and territories:

Christmas Day – Wednesday 25th December
Boxing Day – Thursday 26th December
New Year’s Day – Wednesday 1st January

Need assistance

At Allan Hall HR, we have a team of experienced HR consultants. Please call us on 1300 916 764 or contact us here. to discuss any questions you may have regarding the shutdown period and managing your business during this period.

CONTACT ALLAN HALL HUMAN RESOURCES

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Closing Loopholes Changes

Posted on 26 August 2024 | by Allan Hall

There are new workplace laws that are coming into effect from 26 August 2024, as part of the Closing Loopholes changes.

These changes are important to review if you engage workers under employee or independent contractor arrangements.

We have listed the upcoming changes below and have linked additional articles providing further information.

New definitions of employment – The Fair Work Act will define ’employee’ and ’employer’ based on the true nature and practical reality of the working relationship. This may result in some independent contractor working arrangements being characterised differently. Learn more »
Changes to casual employment – The Fair Work Act will redefine ‘casual employee,’ introduce a new pathway for casuals to become permanent, and increase frequency to provide the Casual Employment Information Statement. Learn more »
Right to disconnect – Eligible employees will have the right to disconnect outside work hours, including refusing to respond to employer or third-party contact, with rules to determine whether such refusal is unreasonable. Note, these changes will not apply to small business employers until 26 August 2025. Learn more »
New minimum standards for gig economy workers and the road transport industry – New minimum standards and protections for gig economy and road transport industry workers, called ‘regulated workers,’ will commence. The Fair Work Commission will be able to set minimum standards orders or guidelines regarding terms such as payments, deductions and insurance. The changes also expand access to collective agreements for regulated workers and provide the Commission with power to deal with dispute resolution for unfair terminations or deactivations.
Additional workplace delegates’ rights – The Fair Work Act will expand rights and protections for workplace delegates. Workplace delegates will include regulated workers, such as employee-like workers and regulated road transport contractors.

There will be further changes to laws affecting Australian workplaces as a result of the Closing Loopholes Acts, and we will post articles to keep you up to date as these changes approach.

Need assistance?

At Allan Hall HR, we have a team of experienced HR consultants. Please call us on 1300 916 764 or contact us here to discuss any questions you may have with us in regard to the upcoming Fair Work Act changes and what your business will need to do to prepare for these. To learn more about our services, please click here.

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Casual Employment Changes

Posted on 5 August 2024 | by Allan Hall

Be aware of changes commencing 26 August 2024 if you employ casuals

What’s Changing?

As a result of the Closing Loopholes legislation passed earlier this year, the Fair Work Act will change effective 26 August 2024 to include:

A new definition of ‘casual employee’
Restrictions on casuals under specific arrangements being employed under fixed-term contracts
A new casual conversion process and employer obligations
Increased frequency to provide the Casual Employment Information Statement.

Casual Employee Definition

Under the new definition of ‘casual employee’ introduced to the Fair Work Act, an employee is only a casual if:

You can choose to offer work to your employee and it is also the employee’s choice whether or not to accept the work
There is no firm advance commitment to ongoing work
The employee’s work is described as casual
Employees will be paid a casual loading or a specific pay rate.

Conversion from casual to permanent employment

Casual employees will remain casual until their employment status changes either through:

a conversion process or Fair Work Commission order, or
commencing work under a new arrangement, following acceptance of an alternative employment offer.

Replacing the existing casual conversion process, employees will be able to notify their employer, in writing, of their intention to change to permanent employment if they meet the following conditions:

they have been employed for at least 6 months (or 12 months if working for a small business employer)
they believe they no longer meet the requirements of the new casual employee definition.

Casual employees cannot notify their employer of their intention to convert to permanent employment if they:

are currently engaged in an ongoing dispute with their employer about casual conversion, or
in the last 6 months:
- their employer refused a previous notification
- a dispute with their employer about casual conversion has been resolved.

Employers must:

consult with the employee prior to responding to the notification, and
respond in writing to the employee within 21 days of the employee providing the notification, either accepting or refusing the change. Please note, there is specific information that must be included in the written acceptance or refusal.

Casual Employment Information Statement

From 26 August 2024, as well as providing the Casual Employment Information Statement (CEIS) to new casual employees, employers will also need to provide the CEIS to all casual employees in accordance with the below:

for non-small businesses:
- as soon as possible and then after 6 months of employment, and
- as soon as possible after 12 months of employment and then every 12 months after that.
for small businesses:
- as soon as possible and then after 12 months of employment.

What should employers do if they employ casual employees?

Review their situation: Employers should review their casual workforce to determine employee status based on the new definition focused on the practical working relationships.
Update contracts: Update any casual contract templates to remove outdated casual conversion references.
Check eligibility requirements: If an employee notifies of their intention to convert to permanent employment, check they meet the eligibility requirements, then consult and respond in writing in accordance with the legislative requirements.
Schedule reminders: Employers should schedule reminders to update and issue the Casual Employment Information Statements at the required intervals.

Need assistance?

At Allan Hall HR, we have a team of experienced HR consultants. Please call us on 1300 916 764 or contact us here to discuss any questions you may have regarding casual employment changes and employee’s eligibility to convert to permanent employment. To learn more about our services, please click here.

CONTACT ALLAN HALL HUMAN RESOURCE

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Independent Contractor Changes

Posted on 30 July 2024 | by Allan Hall

Effective 26 August 2024, changes to the definition of employment and contractor rights may result in some working relationships being characterised differently and the removal of unfair contract terms.

Definition of Employment and Worker Engagement

As a result of the Closing Loopholes legislation, on 26 August 2024 there will be a new definition of employee and employer under the Fair Work Act.

From 26 August 2024, determining if a worker is an employee or independent contractor will be based on the actual nature of the relationship between the parties. Accordingly, a multi-factor test will be used to determine the true working relationship. Factors in the test will include (and can vary from case to case):

the extent of control of, or the right to control, the worker
whether the worker is provided with tools and equipment
whether uniforms were provided and/or required by the principal
whether the worker is permitted to delegate or subcontract work
the remuneration structure – specifically, whether the worker receives payment of a periodic wage or salary or compensation by reference to the completion of a task or project
whether the worker is entitled to paid annual leave or sick leave; and
the express terms of the contract between the parties.

Unfair Terms in Contracts

Contractors can now approach the Fair Work Commission if they believe their contract includes unfair terms. The Fair Work Commission can:

Determine if a contract term is unfair, considering various factors
Set aside, amend, or vary the contract if it contains unfair terms.

Contractors earning above a yet to be determined ‘high-income threshold’ will not be able to seek an unfair contract remedy with the Commission however they can seek a court review.

Sham Contracting

Sham contracting, where an employer falsely represents an employee relationship as an independent contractor arrangement, is prohibited under the Fair Work Act. Employers must review and correct any existing arrangements to ensure compliance.

What should employers do?

Review Worker Classifications: Employers should review current working relationships to ensure they align with the updated criteria. The multi-factor test, as described above, should be used to accurately classify workers as employees or contractors.
Assess and Review Contracts: Ensure current contracts accurately reflect the true nature of the working relationship. Make adjustments if there’s a mismatch between contract terms and practical reality.
Avoid Sham Contracting: Ensure all employment arrangements are correctly classified and transparent. Misrepresenting an employee as an independent contractor is prohibited, so reviewing existing arrangements and updating them if they have been misrepresented, is crucial to comply with the new legislation.

Need assistance?

At Allan Hall HR, we have a team of experienced HR consultants. Please call us on 1300 916 764 or contact us here to discuss any questions you may have in regard to independent contractor changes, including reviewing contracts and the arrangements in place for independent contractors. To learn more about our services, please click here.

CONTACT ALLAN HALL HUMAN RESOURCE

contractors, employer, employment, human resources, legislation

New Right to Disconnect for Employees: What you need to know

Posted on 23 July 2024 | by Allan Hall

Starting on 26 August 2024 for non-small business employers and 26 August 2025 for small business employers, a significant change is coming to workplace relations in Australia.

Eligible employees will now have a new right to disconnect outside of work hours. This change is a result of a push to promote work-life balance and protect employees’ personal time.

Key Points:

Right to Refuse Contact: Employees can refuse to monitor, read, or respond to contact from their employer or a third party outside of their working hours, unless such refusal is deemed unreasonable
Coverage: The right to disconnect includes attempted contact outside an employee’s working hours
Factors for Reasonableness: Several factors determine whether an employee’s refusal is unreasonable, including:
- The reason for contact
- Whether the employee is compensated or paid extra for:
  - Being available to be contacted within a specific period
  - Working additional hours outside their ordinary work hours
- The nature of the employee’s role and level of responsibility
- The employee’s personal circumstances, including family or caring responsibilities
Dispute Resolution: Disputes regarding the right to disconnect should be initially discussed and resolved at the workplace level. If unresolved, employees or employers can approach the Fair Work Commission for resolution
Workplace Right: The right to disconnect will be a workplace right under general protection laws, safeguarding employees’ rights under the Fair Work Act
Award Inclusion: By 26 August 2024, all awards will be required to include a ‘right to disconnect term,’ specifying how this new right applies across various industries and occupations.

Note: this change will come into effect for small business employers from 26 August 2025.

What Should Employers Do?

Review Contracts: Check employment contracts and position descriptions to see if employees are paid with the expectation of being contactable outside normal working hours
Assess Policies: Evaluate and develop current policies and procedures regarding contacting employees after hours
Train Managers: Ensure managers understand the new rules and do not penalise employees for reasonably refusing after hours contact
Inform Employees: Consider providing training and information to employees about their new right to disconnect.

Need assistance?

At Allan Hall HR, we have a team of experienced HR consultants. Please call us on 1300 916 764 or contact us here to discuss any questions you may have in regard to the right to disconnect, how this might impact your business and implementing related policies and procedures. To learn more about our services, please click here.

CONTACT ALLAN HALL HUMAN RESOURCES

childcare, employees, employer, family, human resources, small business

National Minimum Wage rise effective 1 July

Posted on 11 June 2024 | by Allan Hall

The Fair Work Commission has announced this year’s Annual Wage Review Decision

National Minimum Wage Increase

Effective from 1 July 2024, the National Minimum Wage will increase by 3.75%.

This means that full-time or part-time employees in receipt of the minimum wage will receive the following rates before tax:

$24.10 per hour, and
$915.90 per week (based on a 38-hour week for a full-time employee).

This increase will see an extra $33.10 ‘in the pocket’ each week for full-time employees.

This will be effective from the first full pay period on or after 1 July 2024. For example if your pay period starts on Wednesday, the new rates will apply from Wednesday 3 July 2024.

National Minimum Wage Increase

Similar to the National Minium Wage increase, all Modern Award minimum rates of pay will also increase by 3.75% on 1 July 2024.

Most employees are covered by an award, which outlines the minimum pay rates and conditions in various industries and occupations.

If you need assistance determining which award applies to your employees, or the applicable minimum pay rates, please do not hesitate to Contact us.

Changes to Superannuation from 1 July 2024

As a reminder, the super guarantee rate will again rise from 1 July 2024. This will rise by another half percent, taking the minimum super guarantee from 11% to 11.5%.

The super guarantee rate will continue to rise by an additional 0.5% at the start of each financial year, until it reaches 12% in 2025.

Contact Us

At Allan Hall HR, we have a team of experienced HR consultants. To learn more about our services, please click here. Alternatively, please feel free to call us on 1300 916 764 or contact us here to discuss any questions you may have with us in regard to the National Minimum Wage Increase.

compliance, employees, employer, HR Services, human resources, payroll, super guarantee SG, wages

Workplace Gender Equality Agency Reporting

Posted on 25 March 2024 | by Allan Hall

WGEA Reporting or Pay Secrecy

Workplace Gender Equality Agency (WGEA) has published the 2022-2023 median gender pay gaps for private sector businesses with 100 or more employees, encompassing both base salary and total remuneration.

Some notable findings include:

30% of employers have a median gender pay gap between the target range of -5% and +5%
62% of median employer gender pay gaps are over 5% and in favour of men
The remaining (8%) are less than -5% and in favour of women
Across all employers, 50% have a gender pay gap of over 9.1%.

The above findings suggest that there is still a large gap between gender pay equality with only 30% of businesses within the target range. This is largely demonstrated by the statistic that 62% of employers are currently paying men over 5% more than women across the business.

Who needs to complete an annual WGEA report?

All private sector businesses with 100 or more employees are required to complete their WGEA report between 1 April and 31 May of each year. The report must provide data from the previous year for the date ranges of 1 April through to 31 March.

For more information about who needs to report and how to complete the WGEA report, please click:

WGEA EMPLOYER PORTAL

Even if your company has fewer than 100 employees, it is important to be proactive in identifying potential inequalities within the workplace. Conducting a payroll audit and internal salary benchmarking are important steps to take.

How does pay secrecy impact gender pay inequality?

Pay secrecy can play a big part when it comes to gender inequality in the workplace. Pay secrecy, where employees are prohibited from discussing their pay, hampers transparency and can conceal gender-based pay disparities. For this reason, changes have been made from 7 December 2022 to remove the permittance of pay secrecy clauses within contractual agreements. This change aims to advocate for transparency in pay practices to ensure that all employees, regardless of gender, are fairly compensated for their work.

MORE INFORMATION ON PAY SECRECY

Need HR Assistance?

At Allan Hall HR, we have a team of experienced HR consultants. To learn more about our services, please click here. Alternatively, please feel free to call us on 1300 916 764 or contact us to discuss any questions you may have in regard to WGEA Reporting or Pay Secrecy.

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