The Fair Work Ombudsman (FWO) has commenced the first legal action using the new reverse onus of proof laws. These laws require employers to disprove underpayment allegations in Court when they have failed to keep adequate time and wages records or issue pay slips.
Previously, if an employee made an underpayment claim, employers may have been able to utilise what the FWO called “a loophole” and avoid facing fines by the FWO if the claim could not be substantiated due to a lack of evidence confirming if the underpayment occurred or not as a result of the employer not adhering to their record-keeping obligations.
This new law has now flipped the game on its head. Employers who cannot provide sufficient evidence to disprove an underpayment claim, cannot use this as an excuse anymore. Should employers fail to keep adequate employee records and cannot disprove the claim, the underpayment claim will be accepted nonetheless.
The reverse onus of proof is another example of ways in which the Courts are prepared to protect vulnerable workers.
The FWO will not hesitate to take action against businesses who fail to adhere to employment record-keeping or pay slip obligations. In the recent proceedings commenced by the FWO, a sushi operator is facing penalties of up to $63,000 per contravention, and one of the directors facing individual penalties of up to $12,600 for his involvement in record keeping and pay slip obligations.
It’s essential that you take immediate steps to avoid liability and prosecution if you’re at risk.
What can I do?
- Undertake an audit of your business to identify non-compliance regarding how employee records are kept and whether your pay slips are complaint with Fair Work Regulations; and
- Ensure appropriate systems and procedures are in place to keep employee records on file.
If you are unsure of your obligations and looking for support to ensure compliance in your business, contact one of our employment relations specialists today.