- Gather your documentation
- Speak to your employer and present the information
- Keep records and contact the Fair Work Ombudsman if the matter is not resolved
Being underpaid is a relatively common and widespread issue among many Australian workplaces and is more prevalent in some industries than others.
Research suggests Australian workers are shortchanged around $1.35 billion a year in incorrect or unpaid wages and superannuation.
If you think you're being underpaid, there are some important steps you should take, as outlined by the Fair Work Ombudsman.
Before you start
- Gather information about your pay
- Check your award (Fair Work's Find my Award tool can help)
- Check your pay rates (Fair Work's Pay and Conditions tool may help)
It's important to read and understand the documentation you gather to determine whether you are, in fact, being underpaid.
Top Tip
Alas, many employers don't keep adequate employee records. This can make it difficult to address underpayment issues.
It's recommended employees keep an independent record of their hours, either in a diary or using an app such as Record My Hours
Steps to take
1. Prepare
If you believe you are being underpaid, have your payslips and the official award information ready to present to your employer.
If you don't get payslips, this is illegal under Australian regulations and indicates there may be wider issues with your employment.
Work out in advance:
- what you believe your correct pay rate is
- how much you believe you're owed
Arrange a time to speak with your employer and show them your information.
Get ready for the discussion ahead - you may feel awkward or embarrassed raising it. Fair Work provides online courses on having difficult discussions in the workplace.
You may choose to have a support person with you. They can often help you remember the conversation later.
2. Discuss with your employer
The best advice is to stay calm and be open about what you believe your correct pay rate to be and what you think you may be owed.
Also be prepared to listen. If your employer isn't sure, direct them to the Fair Work Ombudsman or you can contact them together.
Write some notes down during or after the meeting about what you discussed and what may have been agreed to.
3. Follow up
Don't leave it at that. After the meeting, send a follow-up email to your employer and include a summary of your discussion and any agreement.
Allow time for your employer to respond, around a week.
If there's an agreed underpayment and the amount is large, your employer may ask if it can be paid in instalments. You'll need to reach an agreement over this and get it in writing.
Acknowledge this agreement and check the backpay you may receive is correct.
What if nothing is resolved?
Of course, not all employer-employee interactions will be quite as straightforward.
The Fair Work Ombudsman can provide information if your employer:
- doesn't respond to your attempts to contact them
- is being unfair or unreasonable
- agrees with you but needs some help to fix the underpayment situation
The steps outlined in fixing a workplace problem on the website can help.
It also pays to be clear on what the Fair Work Ombudsman can and can't help you with.
Other big issues
Visa holders
Visa holders can be particularly vulnerable to underpayment.
If your employer threatens to cancel your visa, remember your boss has no power to do that. Only the Department of Home Affairs can cancel a visa.
The federal government has introduced visa protection pilot programs:
in a bid to help visa holders in this situation.
Dismissal
If you are dismissed or threatened with dismissal for raising the issue with your employer, Australian laws protect people from being sacked for discussing a work problem or asking for correct pay.
That constitutes unfair dismissal which can differ between large and small businesses. Such cases can be referred to the Fair Work Commission.
“Conversations about underpayment are always best in person, so set a meeting and take the information to your manager to discuss the disparity. “The most important thing about this meeting is to not get emotional, make it based on the data, and don’t be too confrontational. “If it’s an honest mistake, they will fix it or at least give you areas to improve on and work towards to achieve that pay scale. “If they don’t do this, then it’s clear they are undervaluing you and you should either take it higher or leave. "You do need to weigh up your options though, as conflict can be extremely stressful for some people, and sometimes it’s better to value yourself and leave instead of constantly fighting with a manager who underpays staff."
Expert advice
Here are some services you can call for advice:
Fair Work Ombudsman: 13 13 94
Australian Union Support Centre: 1300 486 466
Taking legal action
In worst-case scenarios, if your employer won't backpay your correct wages and entitlements and the matter isn't resolved by the Fair Work Ombudsman, legal action may be an avenue.
This should be an option of last resort. There are many steps you can take beforehand without heading to the courts.
If you decide to go down the legal pathway, different courts will hear claims according to the amount owed. Some states also have time limits on how long you have to recover wages so be sure to get legal advice to cover these bases.
If you find you haven't been paid superannuation, you will need to contact the Australian Taxation Office (ATO).
If your employer is in liquidation, you are best to contact the administrator directly. The Australian Securities and Investments Commission (ASIC) may also be able to assist.