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Childcare operator in court over underpayments

19 November 2013

The owner of a childcare business in Melbourne has landed in legal trouble after allegedly underpaying her employees.

As a result of a workplace investigation by the Fair Work Ombudsman (FWO), it was revealed the owner had accrued a backlog of over $15,000 in underpayments owed to a total of five employees. The underpayments spanned the period between June and December last year.

The FWO alleged that the workers were paid below their minimum rate for some of the work they performed, while not being paid at all on various occasions. They were also underpaid for numerous shift allowances they were entitled to.

In addition, the owner is accused of breaching pay slip laws and when approached by Fair Work Inspectors regarding the workers' complaints, she refused to comply with a Notice to Produce.

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In a statement on 11 November, Fair Work Ombudsman Natalie James said that the substantial scale of the breach and the failure to take steps to remedy the issue informed the FWO's decision to take legal action.

If convicted, the owner will face maximum fines from $3,300 to $6,600 per breach, and could potentially receive a court order to back-pay the employees the full amounts.

News earlier this month reporting on back-payments issued to workers in the New South Wales Central Coast area further indicates that remuneration is often a complex area where employers can make costly mistakes.

An HR consulting firm can provide advice on contracts, agreements and policies, helping organisations to stay up-to-date with remuneration and entitlements for employees. iHR Australia offers a range of HR Support Services which can help employers to meet their obligations and take a strategic approach to HR matters.

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