Are you ready for 2025?

Nov 26

3 min read

Once again, the IR landscape is changing…

Wow, how is it nearly Christmas? Again….

While many businesses are preparing for end of year work festivities and taking a well-deserved break, some are just starting to ramp up for their busy season.

Regardless of what is going on in your business, if you an Australian employer – are you ready? No, not for Christmas – but for the Criminalisation of Wages Underpayments from 1 January 2025?

From 1 January 2025 the intentional underpayment of wages will be a criminal offence in Australia. While this doesn’t apply to accidental or genuine mistakes in pay, this ‘accidental or genuine mistake’ reasoning will not be sufficient if you do not have a solid understanding of your obligations under the Awards covering your business, strong processes and regular auditing activities in place to detect and monitor correct payment of wages.

What do I need to consider?

Your employment contracts, wages records (timekeeping and payroll records), and your understanding of the obligations under the Award need to be top notch!

So, no, simply taking the weekly hours the employee works in a week and multiplying that by their hourly rate of pay and considering if overtime is applicable will not be enough.

You will need to be able to say with 100% confidence that as the business owner you know:

the Award/s that cover your business,
this Award inside out and back to front,
if your employees are correctly classified at the correct Level under that Award, and
that you have legally sound contracts of employment, have timekeeping systems in place and produce legally compliant payslips.

Based on Streamline HR’s interactions with employers and those that process payroll, many have a solid understanding of the basics when it comes to regular hours of work, overtime, weekend rates and public holiday rates. That said, there are times when there is confusion around:

how TOIL should be applied if taken in lieu of overtime, and when it needs to be paid out,
application of allowances under the Award,
when meal breaks should be taken, and if there are other penalties if they are not taken on time, and
other seemingly (but not actually) less consequential elements of the Award.

What do I need to do now?

Between now and Christmas and even early into 2025, rally all the stakeholders that are responsible for your payroll. Conduct a risk assessment to understand where there may be risks or controls missing – and put in a plan to minimise or eliminate these risks and establish regular triggers for review.

What’s the worst that can happen?

Well, if your ducks are not lined up (you haven’t been diligent), or you have deliberately underpaid wages, the maximums are:

For a corporation, you will be fined 3 x the value of the underpayment or $7,825,000.00.
For an Individual, you will be fined the greater of 3 x the value of the underpayment or $1,565,000.00 and up to 10 years imprisonment.
QLD business can relax (somewhat) as wage theft has been a criminal offence since 2020.

How can Streamline HR help?

Streamline HR can