Most workers are paid exclusively on the basis of agreed weekly wages or a salary. However, many workers are entitled to additional payments such as:
- Non discretionary bonuses
- Overtime payments, penalty rates, loadings and allowances.
Failure to pay workers their entitlements is a common cause of dispute between workers and employers.
Claims for underpayment must be commenced within 6 years of the underpayment. Segelov Taylor has extensive experience in acting for employers and employees in claims for commissions, bonuses and unpaid wages and entitlements.
Underpayment of wages
Determining the correct wage is often not a simple as many would think. Wages can be set by a contract of employment, or by an award or by an enterprise agreements. Generally speaking the employee is entitled to the most beneficial arrangement.
Assessing the required payment under an awards and enterprise agreements often include complex analysis, including assessment of classifications and job roles, as well as the applicability of overtime rates pay and allowances. Segelov Taylor Lawyers can assist in determining correct payment, and as required, acting in proceedings to recover any underpayment. Claims can also be made for penalties in the event of breaches of law.
Allowances, loadings and overtime payments
Employees covered by awards and enterprise agreements are often entitled to additional payments in the event they have specific responsibilities, or if they work overtime, on weekends or at other defined times.
Determining the correct rate of pay for any given time is complex. Issues as to whether such additional payments are subsumed into a contract of employment are difficult.
Commissions and performance based pay
Employees engaged in sales, or other work which there is a strong correlation between income to the employer and work by the employee (for example, doctors in medical centres, lawyers and accountants) may derive a significant portion of their income from commission structures, and other performance based pay structures.
Disputes often arise as to the amounts payable. Such amounts can be both significant in quantum and difficult to determine. The commission can often relate for work that has been completed some time earlier. Common issues include:
- the capacity of the employer to unilaterally change the commission structure;
- how clients or sales where work has been done by multiple employees should be treated; and
- what occurs when the employment ends.
Many employees are entitled to bonuses. The entitlement to a bonus usually depends on a combination of individual performance, team performance and business performance. The most common issue in connection with bonuses is whether bonus is an entitlement (ie promised by the contract) , or merely a matter of discretion (choice) for the employer. Contractual terms often contain promises of a bonus, the quantum to be at the discretion of the employer.
Even where there is a discretionary element, the employer’s options to not pay the bonus may be limited. For example, the employer may have made pre-employment representations in connection with a bonus that are actionable under the Australian Consumer Law, or the contractual discretion may be to vary the bonus scheme from year to year, but there would still be an obligation to comply with a bonus scheme the employer had in place.