April IR Insights: Award and Wage Audits & NZ Recession

Award and Wage Audits in Australia 

As our Australian clients’ head towards the end of the financial year they will need to consider more than just the July minimum Federal Award Payrate increase. As some of you may be aware, in 2025 Fair Work will criminalise the deliberate underpayment of wages by employers. 

So, what action can you take now to ensure you are set for success and have 100% confidence you are meeting your pay obligations? 

• Audit your payroll systems and processes. This includes ensuring your current employment contracts accurately reflect what is happening within your payroll system. 

• Review the Award/s covering your business. Consider if your existing Awards are still relevant, are there other Awards that may also cover the business or your employees? 

• Check your Award classifications. Should employees be moved to a new Pay Point within their Award level or has their role recently changed? 

• Review wages and salaries. Are you certain that your employees are being paid equal to, or above the requirements under the relevant Award?  

The greatest risk to your business if you do not have everything set up for success, is the potential underpayment of wages. When an underpayment has occurred, there is an obligation to correct this as soon as possible, and make any corrections as far back as the last 6 years. 

Streamline HR can support with your audit requirements including completing your audit for you or reviewing any work you have completed internally. Please reach out to admin@streamlinehr.com.au if you want to know more! 

New Zealand Recession  

It was announced at the end of March that New Zealand has entered its second recession in just under 18 months. 

So, what constitutes a recession? A recession is defined by two quarters of negative growth. Compounding the negative growth has been the pressure of rising interest rates, a fall in GDP, and a labour market that has seen an increase in migrant worker numbers and the lay-off of employees in the public sector. 

What does a recession mean for your business? Other than increasing the costs to deliver your services, you may notice that business is slowing, or your employees are increasingly concerned about their or their family’s job security. 

If you are noticing the recession is starting to impact your business, now may well be the time to implement some strategies to consider your workforce plan. You will need to ensure you have the right people in place to keep the business operating efficiently. If prior recessions have taught us anything, employees will stay with an employer if the economic outlook is uncertain. However, if you make redundancies, it will take you longer to recruit once the economic pressures come off which could slow down your future growth. 

If you need to reconsider your current workforce plan, there are alternatives to redundancy: 

• Identify the critical roles in your business and have a plan to ensure these roles (and the people in them) stay. This may sound counterintuitive, but does this group get a pay increase or offer other incentives to stay on? 

• Rather than making a group of employees redundant, could you offer these employees a temporary reduction in weekly hours to see you through? 

• If you do have resignations during this time, is there an opportunity to cross train employees in other roles, meaning they perform a dual role for a temporary period and absorb natural attrition? 

• Can you drive any process improvements to make the workflows/processes more efficient? 

Redundancies should always be considered as a last resort. If you need to go down this pathway, or if you would like support considering your workforce planning, please reach out to Streamline HR.