Is your company risking an underpayment of wages without realising?

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Fair work actOver the past 20 years I have seen my fair share of companies believing that they are paying their employees a suitable salary or flat rate wage when in fact they were underpaying their employees. Since the inception of the Modern Award in 2010 we now determine the correct salary and wage payment based on the Better Off Overall Test (BOOT) in respect to the Modern Award.

The BOOT is a point in time test, which requires each award covered employee and prospective award covered employee to be better off overall at the test time in comparison if they were paid by their Modern Award. If you are paying your employee by a salary arrangement or flat rate wage then you need to ensure that the salary and wage rates include the following:

  • Overtime rates
  • Penalty Rates
  • Allowances
  • Leave Loading

If you are paying your employees by a Salary or flat wage rate and the employee works overtime, weekends, has allowances and you do not pay leave loading then you need to ensure that indeed you are paying above the Award based on all of these components. Significant fines can incur if you are underpaying your employees.

Modern Award interpretation and conducting a BOOT can be confusing and complicated so call in the experts. Contact Nicole at Moreton Bay HR Solutions today on 0459 220 516 for an assessment.