Short changing workers by not paying them correctly is making big news. From small businesses to franchise operators to massive retail organisations – parts of all sectors have been affected. The ubiquitous comment is that the Awards System is complicated. The NRA is heavily involved; Dominique Lamb, Executive Director gives her views.
As 2019 rapidly comes to a close, the retail sector is not without its challenges.
It’s been an underwhelming year thus far for sales right across the sector. Retailers of all shapes and sizes have battled an economy plagued with low discretionary spending stemming from a lack of consumer confidence.
But one issue that has repeatedly reared its head over the past 18 months – during both the good and ordinary economic cycles – has been wage compliance.
Operators ranging from restaurant chains, fast-food franchises and convenience stores have been found to be underpaying their workers. The issue has not been confined to retail either, with the likes of the ABC and law firm Maurice Blackburn also being at the centre of underpayment claims.
The National Retail Association (NRA) is the only retail industry association to have represented retailers in the wage theft inquiries at the state level, most notably in Queensland, South Australia and Western Australia, and has argued extensively for the Modern Awards system to be streamlined.
It’s complex, confusing and without question the primary reason why underpayment scandals occur. That’s not to excuse instances of non-compliance or to sweep it under the carpet, but a small business owner without a degree in employment law or resources such as a HR department are always at risk of being inadvertently caught up in the web of confusing IR laws.
A simplified set of laws would not only make it easier for employers to avoid incorrectly paying staff, it would also make it straightforward for workers to know what exactly they are entitled to. A system that makes it difficult for both the employer and employee to ascertain the correct staff pay is one that is clearly too complicated.
From our experience, the vast majority of operators found to be incorrectly paying their staff discover the discrepancy themselves and then self-report to the Fair Work Ombudsman (FWO). They are usually mortified and then take every action possible to ensure all current and former employees are paid what they are owed.
However, none of these facts get a look-in when an instance of underpayment makes headlines. The financial penalty from the FWO (even in cases of self-reporting), along with the emotional toll of negative media attention, certainly adds further emphasis to the need to get employee pay right the first time around.
In the meantime, businesses across both retail and the broader economy have no option other than to ensure they are 100% complying with their staffing obligations. Whether a local corner store or a nationwide chain, all retailers need to conduct a thorough review of their systems and double-check that all workers are being paid what they’re legally owed.
The NRA has one of the largest in-house teams of workplace relations experts orientated to the retail and services industries across Australia. We provide our members with up-to-date wage summaries, regular webinars to educate our members on compliance matters and our legal department is always on hand for any queries retailers have in relation to workplace law.
If you’re an employer and are unsure of your compliance responsibilities you should engage a professional without hesitation. The small expense associated with obtaining expert advice is miniscule compared to the financial and emotional cost of being the next retailer found to have been underpaying workers.