You’ve probably heard the old adage that “nothing in life is certain but death and taxes.
Businesses in Australia, and in general, face challenges due to the changing nature of the workforce and the rise in mobility. Keeping track of the workforce, managing their productivity while staying on top of labour laws, and balancing the workforce costs — all at the same time — can get really tricky. Australian businesses are reeling under strict supervision from the Fair Work Ombudsman (FWO) and need to get better at managing their employee records while not losing sight of workforce productivity and costs. Here are some recent cases where businesses were penalized for not paying out their employees correctly:
- A recent case which has been in the public eye where George Calombaris blamed poor processes for underpaying restaurants staff to the tune of $2.6 million. The investigation has been ongoing since 2015, and the restaurant had roped in KPMG to help them with a complete process audit
- Brisbane restaurant operators fined over $200,000 after Fair Work Ombudsman (FWO) investigate worker underpayments
- FWO cracks down on franchisees for inability to comply with workplace laws including underpayment of workers and breaches of other provisions relating to minimum shifts, record-keeping, and pay slips
- 7-Eleven was fined $400,000 as investigations revealed that the employees’ payments were inaccurate and overstated
FWO equips employees with an innovative app
To top it off, the FWO has released an app for employees to track their work hours and overtime. The innovative new app is aimed to allow employees to easily maintain their own record of work hours that can be used as a backup resource should any concerns regarding underpayment arise. Employees can share the data with FWO during investigations. This should ring alarm bells for employers, as without proper processes and systems, they do not have access to this critical time and work information for their own employees. Without such detailed information, they can never be sure if the time they are paying out their employees or any labour policies that are applied are 100 percent accurate. The FWO’s new app is strictly employee-facing, and Australia’s employers have no access to the information their employee’s input — which makes implementing their own time-tracking processes more critical than ever.
Business challenges around employee productivity
Another variable in the equation is the inability of businesses to manage availability and worker productivity in general.
On one hand, you have employee burn-out issues due to the increasing amount of overtime at work which is mostly unpaid. In a study by the Australia Institute, it was found that an average full-time Australian worker did 5.1 hours in unpaid overtime each week — or 264 hours per year. This is close to 14 percent of their work time that is not accounted or paid for.
On the other, we have increasing absenteeism and reduced employee productivity. In another study by DHS, employee absenteeism had increased in Australia, and it was costing businesses over $33 billion in wages and lost productivity. Both these cases speak to the inability of businesses to effectively manage employee work, due in part to a lacking visibility into employee availability.
Benefits of automation
These instances point to the need for Australian employers to institute processes across their workforce to be able to capture their time accurately, apply the right labour laws based on a number of criteria, and manage their employees’ work and hours in real-time to be able to meet their goals of workforce cost management, employee productivity, and labour law compliance. Streamlining their processes around managing employee hours and compliance will have these benefits:
- Complete real-time visibility and control over employee availability and productivity
- Reduced risk of noncompliance with labour and other pertinent regulations
- Decrease in administrative overheads related to payroll processing and compliance
- Oversight and ability to manage labour costs — regular, overtime, etc.