Australian Payroll Manager held personally liable for underpaying staff

The payroll manager and company director were both given heavy fines along with their employer.

An Australian payroll manager has been held personally liable for underpaying workers following a Federal Circuit Court ruling on the matter.

The manager who worked for WY Pty Ltd, which operates two Hanaichi Japanese Fine food outlets in Brisbane, was found to have deliberately underpaid two Taiwanese workers by A$18,491 ($14,009) during 2015. The company has now been ordered to pay the money back to the employees.

But the Court also imposed fines of A$116,250 ($88,023) on WY Pty Ltd after it failed to act on the Fair Work Ombudsman’s (FWO) warnings. Its director was likewise fined A$20,000 ($15,152) and its former payroll and account manager, A$7,000 ($5,300).

Although this is reportedly not the first time that a payroll manager has been penalised over breaches of the Fair Work Act, it is still considered unusual for the FWO to take action against them, preferring to target company directors.

But the FWO put both the director and payroll manager on notice in 2012 after the watchdog discovered that the employees were being paid unlawfully low rates.

FWO Natalie James explained in a statement: “Despite the warning we issued in 2012, the business continued to recruit and underpay vulnerable overseas workers and had not changed the initial flat hourly rates it was paying in almost four years. The penalties send a clear message to business operators that if they ignore our warnings to fix up underpayment problems, we are prepared to take legal action and serious consequences will apply.”

She noted that the payroll manager was an “accessory to the contraventions” and said that both the manager and the director were “fully aware” that staff were being underpaid.

The FWO has also secured an unprecedented court order against WY Pty Ltd requiring it to include industry Award details and FWO contact information in all job advertisements that it publishes over the next two years. It also has to provide new employees with a copy of the Fair Work Information Statement in their language of choice.