A Korean visa holder was underpaid more than $6,000 in just five months while employed at a Japanese restaurant in Sydney. When the...
Ask EdOctober 7, 2015
We work in an industry where mistakes can be costly, can we ask the employee/s to rectify the errors in their own time ie we do not pay them for the overtime taken to rectify their mistake?
The answer to this question can turn on a number of factors (as can many matters within our workplace relations system!).
The National Employment Standards states that employers should only request employees work beyond their ordinary hours if such hours are reasonable. Hours in addition to ordinary hours (even if reasonable) are regarded as overtime; and this is the fact that complicates the matter at hand.
Employees are required to be paid for overtime. This means that even if employees are being directed to work additional hours to rectify errors (arguably a reasonable request), they are still entitled to payment. Further, if employees are covered by an industrial instrument (e.g. an award), such overtime is generally required to be paid at a penalty rate. Unfortunately, to not pay employees exposes employers to underpayment of wages claims on the basis the employee has not been paid for all work performed under their direction.
Employers can of course pay employees in excess of base rates stipulated in industrial instruments to offset the requirement to pay additional wages on each occasion additional hours are worked. If your employees are remunerated to this effect there is definitely a minimised risk with regard to requesting employees work extra hours for no additional payment. This is because the employee’s ordinary rate is high enough to offset the extra payment required.
To manage confusion that may exist with regard to when payment is and is not due for additional hours, as a safeguard, Employsure advises clients to implement a workplace policy that communicates to employees that additional hours worked to complete ordinary duties (a prime example being to correct erroneous work) will generally be considered reasonable additional hours and not ordinarily paid as overtime (unless approved in advance).
Contracts of employment should also highlight the need for employees to work additional hours necessary to complete their duties. If relevant, contracts should clearly stipulate when remuneration has been set to compensate employees for additional hours (ie make it clear from the outset that additional payment will not generally be received).
If remuneration is not sufficient to offset extra hours, it is important for a business to at least understand that potential liability exists in the event that payment is not made.
Another key issue in managing this situation is to ascertain why the employee is making mistakes. For example, is there a misconduct issue preventing them achieving productivity requirements or has the employee not received relevant training? It is important to know that in each of these cases employers can effectively manage their employees to elevate, and hopefully prevent, future mistakes.
Performance improvement plans are a great way to help employees overcome any pitfalls they have with regard to accurate output. Disciplinary action can be taken against employees who are more wilfully making errors. Businesses do not have to tolerate costly errors made by their employees. However, it is important that workplace laws are followed so as to mitigate any potential claims and penalties that could arise when holding employees accountable.
If you would like any further advice on how to minimise employee errors, or discuss any employee performance issues you have, please call our advice line on 1300 651 415. Or if you have a curly question you would like to ask me click here.