ARE YOU PAYING YOUR EMPLOYEES CORRECTLY?

Fair Work are watching – are you paying your employees and contractors correctly?

There have been more and more cases before the Fair Work Ombudsman recently catching out Australian businesses unknowingly doing the wrong thing.  Fairwork are investigating non compliance more and more.  Disgruntled employees can also easily put in a claim against you.  Some of the most common areas of concern are as follows:

CONTRACTORS

There are many instances of cases where people hire ‘contractors’, but they are really employees under the definition of the law.  The building industry and cleaning industry are examples of where this happens extensively.

If you have contractors working for you on a regular basis, they may be entitled to superannuation and annual leave if they are really employees.  If your contractor does any of the following, please talk to us about the arrangement, as you may be at risk:

  • Invoices on an hourly basis
  • Uses equipment, supplies or tools provided by you
  • Works for you the majority of the time

If you have anyone that falls under the above points, you may be liable to pay superannuation and leave entitlements, even if you paid them a higher rate to cover this already.

NOT PAYING CORRECT RATES OR FOLLOWING AWARDS

A recent campaign to look into employees in Western Sydney found that 64% of the 197 businesses audited were found to not comply with workplace laws.  In our role in assisting businesses with their payroll, we often find that our new clients are not meeting their obligations.  These are business owners wanting to do the right thing, but unknowingly are putting their business at risk of penalties and future financial stress.

You need to regularly review the award to ensure you are paying your employees correctly and are meeting any additional requirements such as allowances, super guarantee limits and classifications.

RECORD KEEPING AND PAYSLIPS

Employers must keep adequate records and all employees are to be provided with a payslip that meets the requirements as set out on the Fair Work website found here

The national average of businesses that are found to be non complying with this as 30.2%.  That is almost 1 in 3 businesses who do not satisfy the requirements.  Are you doing the right thing?  Do you know what the requirements are?  Evolve Online Bookkeeping uses Xero to help our clients meet these requirements.  If you are unsure, please have a chat to us.

RISK OF OTHERS

If a business is found to be not meeting these requirements, not only will be the business owner be penalised, but any other party or employee found to be involved such as office managers, administration staff that process payroll, bookkeepers and accountants.   No-longer does the buck stop with the business owner.  If anyone else knows or should have known that the wrong thing was being done, they will be fined also.

At Evolve Online Bookkeeping, we do not provide HR advice, but if we identify that you are not meeting the legislation, we will advise you accordingly so that you can obtain HR advice and it can be rectified.  If you continue to ignore this, we will be unable to provide services to you, due to the legal risk you will be putting us in.

We have found that our clients do want to do the right thing and will rectify the situation once it is identified, so we have not had a problem in the past.  If you are unsure about your employees, we recommend getting advice immediately.  We can put you in touch with a relevant expert to assist you.

Jodie Thompson

Jodie Thompson

Jodie is a qualified CPA and company director having managed her own accounting and advisory firm for over 10 years. Jodie’s experience in establishing and growing businesses is second to none and her hands on approach and technical expertise is valued by our team and our clients alike.

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(07) 5413 9393
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