As of March 1 2020, three important practices aimed at reducing wage theft and non-compliance with awards are now legally enforceable for employers.

The changes will require employers utilising 22 modern awards to be much more stringent about overtime and record-keeping measures. If you run a small business it’s vital you stay abreast of the changes summarised below:

1. Employers will need to notify employees in writing of their annualised salary and their maximum ordinary working hours outside of the 38-hour week.
2. If an employer finds that their employee received less pay on their annualised wage agreement than if they were paid under the award, they need to pay the employee the difference. Any shortfalls must be paid to them within 14 days.
3. Employers will need to keep records of the start, finish and break times of their employees.

While the changes have been brought in by Fair Work in response to wage theft, Tracy Angwin CEO of the Australian Payroll Association suggests the changes could affect the culture in a lot of small businesses.

“Up until now, employers have been able to rely on a system of trust with their employees. The new annualised salary clauses in some modern awards, which will require more stringent record-keeping and overtime control measures, such as recording the start, finish and break times of employees, will completely change that. In fact, it could erode the trust between employers and their staff.”

She continues: “Payroll is one of the most complex and legislated areas of a business, but increasingly we’re finding that legislators are creating laws without properly thinking about how employers are going to implement them.

“The 1 March changes – and their propensity to create a ‘clock-watching’ mentality among staff – is another example of this. Clearly a commonsense approach is needed here to ensure that the intent of the legislation is in fact going to benefit each workplace environment on a practical level.”

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Want to know more about the payroll changes in effect in 2020. Read on..