It’s time to overhaul our complex awards system

Already this year the news agenda has been dominated by instances of retail employees not receiving a fair wage for the work they undertake. In more and more of these cases, we are seeing Australia’s overly complex awards system be wrongly interpreted, resulting in underpayment.

The most recent high-profile example saw Super Retail Group, which owns Supercheap Auto, Ray’s, Macpac, Rebel and BCF, admitting to underpaying over 4500 employees up to $8 million after incorrectly calculating overtime pay and allowances, subsequently kicking off a remediation program to repay its employees.

The problem was a genuine oversight, the Group simply failed to take into account updates to the Fair Work Industry Awards regarding time in lieu, award rates and allowances to overtime hours. But when I read the headlines, I was not shocked.

In fact, having spent the past 15 years building technology to help businesses navigate Australia’s overly complex awards and wage systems, I was frustrated that another innocent company had fallen victim to this dangerous systemic issue.

The issue is this; the current Fair Work guidance is over 100 pages long, a legal document, written by lawyers that neither employers nor employees understand.

Businesses trying to grapple with this document to ensure compliance often find out that they are in breach when they’re audited, but by then it’s too late. They’re slapped with a fine or face court hearings. With either outcome they suffer financially.

This is not conducive to Australia’s ambitions as an enterprise nation, where large fines could see smaller retailers crumble under the fees.

The complexity of the Fair Work Industry awards has created a dangerous knowledge gap among both employers and employees and it’s now more urgent than ever for Australian Government to overhaul its complex award and wage system and equip Aussie retailers with the appropriate tools to navigate the tricky Fair Work system.

To clarify, I am by no means calling for awards and wages to be made a flat rate. Under the current system, I agree that it is fair and just to consider factors such as age, experience and the time of day they are required to work when determining the appropriate wage.

Nor am I pointing the finger directly at Fair Work. But I do understand that there have already been over 1000 hearings and conferences held to find solutions on how best to overhaul this complex system and help businesses interpret it. It is incomprehensible to me that the issue has been on the radar of regulators for years, and yet there is still no solution in sight.

To put it simply, there is no time to delay. We’ve seen multinational companies, large retailers and small businesses falling prey to this system, and based on current news reports, it’s not slowing down any time soon. The latest case with Super Retail Group is a prime example of why we must not delay.

Ashik Ahmed, CEO and founder of Deputy.

Comments

2 comments

  1. Avatar

    Michael posted on August 22, 2018

    Did they manage to include the changes to the award rates that reduced Sunday penalties? It seems there are many, many cases of employers making mistakes applying the award, yet the mistakes seem to always result in underpayment. reply

  2. Avatar

    John Bugge posted on August 27, 2018

    So true Michael, It's always the fault of someone else? reply

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