Jail Time For Underpayment of Wages

The last sitting of the Queensland Parliament before the election was 17 September 2020. During that final session, legislation was passed that now makes it a criminal offence to knowingly underpay staff. (Stand by for some heavy legal argument around the term “knowingly”.) This potentially means jail time for erring employers for up to fourteen years.

In a career of over forty years I cannot recall a single organisation that deliberately underpaid its workers. That is not to say it does not happen. I know for a fact that it does. Almost invariably, underpayment (and overpayment) occurs purely because of the complexity of the award system. At times oversight and lack of diligence are contributing factors.

If, as an employer, you think the system is stacked against you; you might just be right. You could certainly be forgiven for coming to that conclusion. What can be said without fear of contradiction is that this legislation cannot be seen as inducing employers to hire more staff.

Any worker, or union representing a worker, can initiate a criminal investigation by making a complaint to the Queensland Police Service. Similarly, the same parties can initiate a civil process via the new Industrial Magistrates Court. Conciliation is mandated for cases up to $20,000.00.

What do you need to do?

At the very least make a systematic review of your payroll.

• Are you using the right award?
• Have you correctly classified your workers?
• Are you adhering to minimum award rates?
• Have you ensured that all relevant allowances are paid appropriately?
• And most importantly – document how you arrived at your conclusions.

Magnus is not a specialist in HR, but we can help with some basic matters. If you would like to discuss the matter further contact Warren Maris on 07 3483 0100.