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What Do I Do If My Employer Is Not Paying Me Correctly?

What Do I Do If My Employer Is Not Paying Me Correctly?

Is your employer paying you incorrectly and below industry standards? Know your rights and what action you can take in this situation.

21st January 2021
Reading Time: 4 minutes

Many people work jobs where their employers don’t pay them correctly. Whether accidental or done as an attempt to reduce costs, being paid correctly is your legal right as an employee. Your employer has an obligation and duty to pay you for your work correctly and respectfully. Incorrect payments may very well be, an honest human mistake. But it’s important that these remain nothing more than a mistake as this can have serious consequences if they become habitual. Keep reading for more information on how to resolve this matter with your employer. Additionally, we’ll take you through what action you can take if your employer isn’t willing to pay you correctly.

How to start the hard conversation with your employer

The starting point is initiating that hard conversation with them. You’re probably anxiously asking yourself: ‘how do I bring this up?’ There’s no easy way to do this and you might be afraid of losing your job in the process. Before deciding to take any court action, speaking directly with your employer is a key step that allows for open communication about the situation at hand. This can be carried out over a phone call, face to face meeting or video conference. As mentioned earlier, your employer may have mistakenly paid you the incorrect amount. You’ll want to have the following items handy to back up your claims with evidence in your conversation with your employer:

  • Your payslips detailing incorrect wages or unpaid entitlements;
  • Bank statements from the financial institution you bank with;
  • Award or enterprise if applicable; and
  • Your employment contract, again if it’s applicable.

If you do find, however, that following the conversation with your employer your wages or entitlements still haven’t been correctly paid, there’s other avenues available to you before you resort to going to court. Here are some options that you may want to consider before bearing the heavy legal costs that are involved in bringing your matter to court:

1. Issue a letter of demand

So you’ve spoken to your employer directly and haven’t made any progress with your claim. What’s next you’re wondering? A letter of demand. A letter of demand doesn’t require you to go to court and is again, a very cost effective way to get your point across in writing. An example of a simple letter of demand can be found here. They don’t need to be elaborate, but just need to include the missing wages and entitlements. You can also easily access a free Letter of Demand template provided by the link below. It’s customisable to your claim and more importantly, easily accessible.

2. Contact the Fair Work Commission

If issuing a Letter of Demand provides no avenue for resolution or compensation, you have the right to contact the Fair Work Ombudsman (FWO). The FWO can investigate your claim and take further steps if they believe it’s necessary for your case. Ideally, the issue at hand should be resolved between you and your employer before the FWO intervenes. Prior to intervention, the FWO considers how serious the workplace issue, the employer and employee’s circumstances and what the practical issue are in resolving the problem. The role of the FWO is to remain neutral, explain how the law operates under the Fair Work Act 2009 and help you and your employer come to an agreement.

Alternative Dispute Resolution (ADR)

Another alternative option is Alternative Dispute Resolution (ADR). A suitable form of ADR for this type of legal dilemma is conciliation through the Australian Human Rights Commission. You may not have heard of ADR until now, but it’s an available option should you find yourself needing it. Conciliation is an informal and flexible method of dispute resolution, involving negotiations between the Conciliator and parties involved. The Conciliator who represents the Commission is a neutral third party and is usually an accredited mediator as well. You don’t need a lawyer to conciliate a complaint. It’s crucial to note that conciliation doesn’t involve a public hearing, a court or tribunal. Rather, it allows you and your employer to express your point of views, discuss the issue and come to a legal conciliation agreement on your own terms. An apology, compensation for lost wages, policy changes to the workplace are also possible outcomes.

Commencing Court Proceedings

After you have exhausted all options of voluntarily resolving your claim, you may opt to commence court proceedings. This can be taken to the ‘small claims court’, such as the Federal Circuit Court according to the FWO. This is the cheaper and less formal option if you’re planning to take your matter to court. You don’t have to involve a lawyer because this specific court process is for smaller amounts of money. Cases heard here for wage recovery are for claims of money less than $20,000. The entitlement claim has to be covered under Australian employment laws such as the Fair Work Act 2009 (Cth). There’s also a rule that the claim exceed a 6 year timeframe.

Alternatively, the Federal Court has the standing to hear unpaid wages and entitlements claims. This is where you need to seek legal advice if this the road you’re taking with your claim. Keep in mind that the legal process with the Federal Court is a lot more expensive and formal as claims by national system employees can also be made here. This process greatly differs to the small claims court.

Claims under GEERS or FEG

Lastly, what if your employer’s business faces bankruptcy or liquidation? What you do you then? Well, you may be able to recover unpaid wages and entitlements under the ‘General Employee Entitlements and Redundancy Scheme‘ (GEERS) or ‘Fair Entitlements Guarantees’ (FEG). Ensure you meet the eligibility requirements before you decide to lodge a claim. If you’re still stuck and unsure of how to get started, don’t hesitate to contact a Lawpath consultant who can direct you to the right path for you.

Don’t know where to start?
Contact a Lawpath consultant on 1800 529 728 to learn more about customising legal documents and obtaining a fixed-fee quote from Australia’s largest legal marketplace.

Mia Miranda

Mia is a Legal Tech Intern at Lawpath. She is in her Final Year of a Bachelor of Arts and Bachelor of Laws degree majoring in International Law & Global Governance. She is interested in international relations, governance, criminal law and how technology is revolutionising the legal industry.