The Fair Work Ombudsman (FWO) has launched the first legal action using new reverse onus of proof provisions, that require employers to disprove underpayment claims if they have not kept adequate records.

The Fair Work Ombudsman (FWO) has launched the first legal action using new reverse onus of proof provisions, that require employers to disprove underpayment claims if they have not kept adequate records.  As a result, a recent FWO investigation revealed nine workers were underpaid a total of $19,467 in entitlements, for which the employer did not have employment records and pay slips. The Company being prosecuted faces penalties of up to $63,000 per contravention.  Together with the three directors facing penalties of up to $12,600 for their alleged involvement in contraventions involving leave entitlements.  One of the directors is facing a further $12,600 penalty for his involvement in the record-keeping and pay slip breaches.

What this means is employers who don’t meet record-keeping or pay slip obligations and can’t give a reasonable excuse as to why they couldn’t, will need to disprove allegations in wage claims made in a court. This is referred to as a reverse onus of proof, and applies to breaches of the following:

• the National Employment Standards
• a modern award
• an enterprise agreement
• a workplace determination 
• a national minimum wage order 
• an equal remuneration wage order
• method and frequency of paying wages
• the section that says an employer must not require employees to spend any of their money or pay back their wages if it unreasonable.

If an employee claims there is breach of one or more of the above obligations and the employer didn’t keep the right records, make those records available, or give the employee a pay slip, the employer needs to prove that they did pay the employee correctly and/or gave them the right entitlements.

Acting Fair Work Ombudsman Kristen Hannah stated in Workplace Express that;  “In the past some employers had avoided facing litigation by FWO because they had breached their record-keeping obligations, and we could not present sufficient evidence in Court to prove underpayments.”   Hannah went on to state, “Employers should be on notice that this loophole is now closed and the Fair Work Ombudsman will make full use of the new laws to protect vulnerable workers.”

If you are unsure whether you are complying with the requirements of the Fair Work Act 2009 and the Fair Work Regulations 2009 call me on 0428 112 008.