HR Highlight: Deductions From Wages Illegal
By Elisha Radwanowski, B Com (HRM & IR)
Managing employee performance is always a challenge. Working to clearly establish expected behaviours, then ensuring that those behaviours are demonstrated and corrected if required is difficult and requires patience, attention to procedural fairness and good documentation. This week’s HR Highlight will explore an illegal and largely ineffective method of performance management, namely docking employees pay packet for business breaches.
Several recent cases have shone the spotlight on the illegal practice of ‘pay docking’. As part of recent routine inspection activity has identified several employers who have been taking illegal deductions from employees’ wages for everything from burning an omelette, to placing tomato into sandwiches incorrectly. The most common form of ‘pay docking’ however, remains the deduction of ‘register out of balance’ amounts from employees’ wages.
ACAPMA reminds Members that deductions from employees’ wages for performance breaches, including ‘register out of balance’ situations, is illegal and penalties can be applied to the business by the Fair Work Ombudsman and Commission as well as orders to pay funds back to employees.
Fair Work Ombudsman Natalie James notes “Deducting money from employee wages as a punishment, or as some sort of performance management tool, is completely unlawful. And it is clearly not a constructive way of encouraging staff to improve their performance if there are performance issues that need addressing”.
ACAPMA Members are reminded that they can access advice and assistance with performance management by contacting the Employment Department on 1300 160 270 or via firstname.lastname@example.org.
HR Highlights are things to consider, implement and watch out for in your business. They are provided as general advice and you should seek further advice on your specific situation by calling 1300 160 270 and speaking to one of the ACAPMA Employment Professionals – it’s free for Members. ACAPMA Membership is affordable at only $770 per year for up to 5 retail sites, which represents great value with sites gaining employment advice, support and representation as well as a raft of other benefits and discounts. To learn more about ACAPMA Membership email email@example.com or click here.