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Ready for the Fair Work Ombudsman Compliance Blitz - One Touch Panic?

Along with Dry July (yep, no booze for the month), the increase in pay rates, and One Touch Payroll for small businesses, it’s all here by the 1st of July 2019.  I’m receiving a number of freak out calls from prospective clients realising that after they have addressed the issue of ensuring that they have proper payrolling software in place, that they now have to ensure their employees are legitimately recognised, that means, no more cash paid employees, weird additional payments and no more sham contractors.    In turn it also means an employment contract.   

The Australian Human Resources Institute heard from Sandra Parker this week.  The Fair Work Ombudsman warns employers to ‘get their house in order’ as the regulator prepares for a compliance blitz in the new financial year.  This is a definite focus on ensuring an employer is paying its employees correctly. This week three Toyko Shushi stores in regional NSW were found owing 31 employees over $70,000 in wages.    Regional NSW is not exempt!!

Here are three things that you need to understand that coincide with the implementation of One Touch Payroll and the compliance blitz from the Fair Work Ombudsman. 

one-touch-payroll

What Award are my Employees Covered By:

Award determination is something that should be done with much consideration.  If you get it wrong, you will suffer the consequences, and this could include backpay of wages, a fine from Fair Work Australia and more importantly, unhappy employees.  As you start to upload your One Touch Payroll system you will need to put in payrates and in some software packages, Award determinations and the classifications of your employees therein.    

Award allocation is determined by two key factors.  Firstly, the ‘industry’ that your company operates in and secondly the ‘occupation’ of your employees.  Sometimes they can be covered by two (2) different Awards because an employee may have industry and occupational coverage.      

A recent example of complex Award determination in a company is that of the premix concrete industry.   The Premix Concrete Award 2010 applies if you have a batch worker. However, your truck drivers that drive the concrete trucks are covered under the Roads, Transport and Distribution Award 2010 because there is more occupational coverage for the employees in this Award.   

Confused yet? Call me, I can help you. It’s important you get it right. 

Correct Payroll and Entitlements?

So now you need to pay them correctly, in accordance with the allocated Award.  No more estimated payments for time worked by an employee as overtime, no more services in kind, like a load of fuel for hours of work. Simply, it’s not going to wash.    

An employee must be paid for all and any hours work by depositing at the very least minimum wages as per the Award into their nominated bank account. You must remember penalty rates for work that is performed on public holidays or weekends. You must remember applicable allowances that apply to the employee for work performed in your industry e.g. If your farmhand is using his dog or horse for work purposes, you’ll have applicable allowances under the Pastoral Award 2010.  So minimum wages include the minimum hourly rate, plus penalties, overtime and allowances. 

If you choose to reward or incentify an employee beyond this with various benefits (i.e. feed for their horse, fuel, mobile phone payment or a bonus), this is entirely up to the goodness of your heart, provided you have paid the minimum amounts listed above first and foremost. 

Get it right and don’t short-change your employees with a verbal or handshake arrangement to cashless benefits.  Pay employees properly. 

Get your Employment Relationship in Writing!

Its very hard to manage, let alone terminate your employees if you do not have a written employment agreement between both parties.  Fair Work Australia requires business owners to inform their employees of what Award is applicable to their employment and what their minimum payrate is under the Award.     

Why wouldn’t you do that through a proper employment letter?      

One Touch Payroll is about legitimising your current employees that you have on your books.  A legitimate employee has a legitimate employment contract that outlines the terms, conditions and benefits of being an employee. If you haven’t got one, you need one, particularly now that you have them uploaded into your payroll system.  

One thing I’ve found that separates a good employer from the rest, is that the employment relationship between both parties is clear, concise and once signed onto by the employee provides a focus from the employee to simply get on and do a good job rather than worrying about if they are being paid correctly.     

If you need assistance with Award determination, understanding the nuances in the applicable Award and a employment contract, call me and I’ll help you get things sorted out.   

Employees are your best business asset!

Call us now on 0411 254 865 or email for an appointment at ahendy@hendyhr.com.au

Leanne O'Sullivan