The failure to pay hundreds of freight-handling and depot staff for 20-minute meal breaks has cost national parcel-delivery business CouriersPlease $50,000, as an expert warns employers about the dangers of a set-it-and-forget-it approach to payroll.
Last Friday, CouriersPlease signed an enforceable undertaking with the Fair Work Ombudsman (FWO) after it emerged the company underpaid 245 shift workers by $382,000 over eight years.
The company, which self-reported to the FWO after an internal audit uncovered the breaches in August 2018, has taken longer than 12 months to backpay staff, with 41 workers still owed about $21,000.
A $50,000 “contrition payment” will be made to the Commonwealth under its agreement with the FWO, which also commits CouriersPlease to undertake mandatory workplace law training and independent payroll audits until 2022.
Get business news first
Sign up to SmartCompany’s daily newsletter
The underpayments occurred after CouriersPlease implemented an electronic payroll system in 2010, leading to an error applying clause 24.9 of the Roads Transport and Distribution Award, which says shift workers must be paid for 20-minute meal breaks.
CouriersPlease, a fully-owned subsidiary of Singapore Post, claimed the breaches of the Fair Work Act were triggered by a change in organisational structure, which saw workers transitioned from ordinary hours to shift work in October 2012.
“This was an unintentional oversight which we deeply regret,” the company said in a statement.
The specifics of meal break provisions vary from award to -award, with some industries mandating paid breaks and others not.
In the Roads Transport and Distribution Award, ordinary hour workers (5.30am to 6.30pm) aren’t entitled to paid meal breaks, but those classified as shift workers are.
Ombudsman Sandra Parker said CouriersPlease’s undertaking was a warning to other employers that don’t “prioritise workplace compliance”.
“You risk failing to meet your lawful obligations to your employees every shift they work over many years, and facing a hefty back-payment bill,” Parker said in a statement.
The case is just the latest wage theft scandal to emerge in recent months, following high-profile disclosures by the likes of Woolworths, Michael Hill and Wesfarmers-owned Bunnings.
Many small businesses have also been caught stealing wages from workers over the last 18 months as an ongoing Senate probe considers what can be done to better protect workers.
Workplace Law managing director Athena Koelmeyer says employers should avoid a set-it-and-forget-it mentality towards payroll operations if they want to avoid a visit from the FWO.
“Over the last five years there have been an insurmountable plethora of award amendments which have significant impact and could include things like breaks and whether they should be paid,” Koelmeyer tells SmartCompany.
“If you set up your payroll system in 2010 and have not kept it up to date … you will find yourself in a non-compliant position.”
Koelmeyer says businesses should ensure payroll staff are included in discussions about changing organisational structures to minimise the risk that workplace changes will result in employees being inadvertently ripped off.
“Involve payroll in your discussions at an early point when you are talking about changing your organisational structure or your industrial arrangements.”
Correction: A previous version of this article incorrectly attributed underpayments to The Reject Shop instead of Michael Hill. This article was updated at 8:15AM AEDT December 3.