Earlier this month, the Fair Work Ombudsman (FWO) announced that a record $532 million in unpaid wages and entitlements had been recovered for more than 384,000 workers in 2021-22.
Background and Summary
Following extensive efforts by the FWO to create an environment that encourages large corporations to prioritise compliance, the sum of recoveries was more than three times that of last year’s record and benefitted five times the number of workers across the nation. In addition to this, more than half of the recoveries – almost $279 million – came from large corporate employers.
The extent of this issue spans across numerous industries and business sizes. In June 2022, the FWO took Woolworths to court in relation to “major underpayments” of its salaried managers. However, Woolworths is just an example of major employers that have underpaid their workers, including Wesfarmers, Qantas, the Commonwealth Bank, Super Retail Group, Michael Hill Jewellers and the Australian Broadcasting Corporation.
Kristen Hannah, Deputy FWO (Policy and Communication), announced these figures in a speech to the Policy-Influence-Reform (PIR) conference in Canberra, saying they were “good news” for workers and compliant businesses.
She went on to state that “the FWO’s strengthened compliance and enforcement approach has seen another record amount of back paid wages for Australian workers in the last financial year…this is a great result for the workers who have been reunited with their withheld wages, and also for the businesses that pay correctly and are no longer at a disadvantage as a result.”
Currently, the FWO has approximately 50 investigations underway into large corporates that have self-reported underpayments, including some of Australia’s largest companies. The FWO has also pledged to continue to assist small businesses by providing more than 1200 written pieces of tailored technical advice to employers.
Our firm offers Modern Award audits to ensure compliance, and conducting a proactive review such as this is encouraged to avoid underpayment prosecution by the FWO. It is important to note that even if you pay your employees above award rates, this does not guarantee that the engagement is award compliant.
If you have any questions about wage underpayment, award compliance generally or our firm’s Modern Award Audit procedure, please do not hesitate to contact Nick Stevens, Peter Hindeleh, Daphne Klianis or Josh Hoggett.