De­duc­tions from pay and all the le­gal­i­ties!

Australasian Timber - - ASSOCIATIONS - Brian Beecroft Chief Ex­ec­u­tive Of­fi­cer (CEO) Tim­ber Trade In­dus­trial As­so­ci­a­tion (TTIA)

I’ve been told on many oc­ca­sions by pay­roll pro­fes­sion­als over the years that em­ploy­ees be­come math­e­mat­i­cal ge­niuses when it comes to de­duc­tions of any per­ceived dis­crep­ancy in their pay whether based on fact or not. While this may in­deed be the case, the law does make it ex­tremely dif­fi­cult for em­ploy­ers to make au­tho­rised de­duc­tions from an em­ployee pay aside from PAYG with­out: the spe­cific author­ity of the em­ployee; a pro­vi­sion spec­i­fied in the rel­e­vant award or agree­ment; or a con­di­tion spec­i­fied in the con­tract of em­ploy­ment that al­lows the em­ployer to make de­duc­tions from monies due to an em­ployee un­der rea­son­able cir­cum­stances. For in­stance, many em­ploy­ers would be sur­prised that it is il­le­gal to make de­duc­tions from an em­ployee pay in cir­cum­stances such as short­falls in cash ex­pe­ri­enced by an em­ployee in the course of em­ploy­ment (un­less au­tho­rised by an award, see be­low); fines im­posed by em­ploy­ers on em­ploy­ees for breaches of com­pany poli­cies or prac­tices or for such mat­ters as late­ness to work; re­cov­ery of monies ow­ing from a pri­vate loan; re­cov­ery of monies caused by dam­age to com­pany prop­erty. Such monies can only be re­cov­ered by de­duc­tion from the em­ployee’s pay by agree­ment with the em­ployee. A few ex­am­ples of rea­son­able de­duc­tion may in­clude: where an em­ployee fails to give ap­pro­pri­ate no­tice on ter­mi­na­tion the cost of items pur­chased on a cor­po­rate credit card for per­sonal use by the em­ployee the cost of per­sonal calls on a com­pany mo­bile phone the cost of petrol pur­chased for the pri­vate use of a com­pany ve­hi­cle by the em­ployee. It re­ally is a mine­field and an area where em­ploy­ers should seek ad­vice from the TTIA be­fore pro­ceed­ing with pay­roll de­duc­tions if there is even the slight­est of doubt. The TTIA Em­ploy­ers Hot­line can be ac­cessed on 02 9264 0011. from 1 July 2018. The high in­come thresh­old will in­crease to $145,400 per an­num, ef­fec­tive 1 July 2018. The pre­vi­ous thresh­old was $142,000 per an­num un­til 30 June 2018. The high in­come thresh­old is the amount by which a cat­e­gory of em­ployee is ex­cluded from the un­fair dis­missal pro­vi­sions of the Fair Work Act, and in re­la­tion to the guar­an­tee of an­nual earn­ings re­lat­ing to mod­ern awards. The in­crease in the thresh­old af­fects a num­ber of dif­fer­ent pro­vi­sions un­der the Fair Work Act, in­clud­ing: an award/agree­ment­free em­ployee’s el­i­gi­bil­ity to claim un­fair dis­missal; the max­i­mum amount of com­pen­sa­tion of six months’ earn­ings that the Fair Work Com­mis­sion can or­der an em­ployer to pay to an em­ployee deemed to have been un­fairly dis­missed; and the level an em­ployer can guar­an­tee an em­ployee’s earn­ings which ren­ders the pro­vi­sion of the ap­pli­ca­ble mod­ern award no longer ap­pli­ca­ble to the em­ployee. This can be a com­plex area, par­tic­u­larly is­sues in re­la­tion to what part of an em­ployee’s pack­age can be at­trib­uted to the thresh­old fig­ure. Em­ploy­ers who are un­sure with re­gard to an em­ployee’s award cov­er­age or ac­cess to un­fair dis­missal are al­ways ad­vised to con­tact the TTIA Em­ploy­ers Hot­line for ad­vice and as­sis­tance (02 9264 0011).

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