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With payroll errors popping up more than ever, bookkeepers have been urged to probe their employer clients’ knowledge of awards and to be prepared to walk away from those refusing to correct known problems.
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‘Be prepared to walk away’: Dealing with errant payroll clients
18 July 2019
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6 minute read
This week, celebrity chef George Calombaris’ MAdE Establishment group of companies backpaid $7.8 million in underpayments after it found "incorrect processes and failures within its payroll and human resources functions".
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Last week, jewellery chain Michael Hill uncovered historic underpayments to employees worth between $10 million and $25 million due to non-compliance with some requirements of the General Retail Industry Award.
Cosmetics firm Lush Australia last year admitted to underpaying over 5,000 workers around $2 million after locating a payroll error that saw staff incorrectly paid according to industry awards.
Speaking to The Bookkeeper, Institute of Certified Bookkeepers executive chair Matthew Addison said that while the obligation ultimately fell on the employer, bookkeepers needed to ensure they were asking guiding questions.
“Certified bookkeepers have been involved in the journey of assisting employers with becoming aware of the obligations including endeavouring to understand and apply our unnecessarily complex award system.
“We believe that if a bookkeeper is involved in payroll duties, then the bookkeeper has an obligation to be asking questions about the employers’ knowledge of the appropriate awards and seeking, on behalf of the employer, to ensure correct review of pay rates and entitlements.
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“Ultimately, it is the employer’s obligation and the bookkeeper can only perform duties they are engaged to do. If the bookkeeper is not instructed to conduct a review and make changes but has concerns, they should ensure their questions have been asked in writing.”
Mr Addison also said it was crucial for bookkeepers to engage an HR expert, especially if they were involved in payroll services.
“If a bookkeeper has concerns, they must ask the question, and if the employer is refusing to correct known problems, then be prepared to walk away,” he added.
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