Due to requests from some of our franchise clients, we launched our external Payroll Audit Service to review Payroll and Award/Enterprise Agreement compliance at the franchisee outlet level.
Most Common Payroll Issues Found
- Many franchisees are using the franchisor’s Enterprise Agreement for their new (i.e. “non-transferring”) employees, even where there aren’t the required special orders from the FWC permitting them to do so. This has resulted in the need to backpay employees their proper award entitlements. We suspect this is often due to simple ignorance by the franchisee, or alternatively the franchisor/franchisees not knowing their options. We have assisted many client franchise businesses to solve “transmission” or “transfer” of business problems and thus avoid having different employment obligations between transferring and non-transferring employees.
- Employers being unaware of their obligations to obtain proof of their employees’ right to work in Australia. A previous article of ours reflects the importance of ensuring your employees are are able to work legally in Australia, in line with any visa restrictions.
- Employers putting their employees on salary arrangements which do not adequately compensate for offsetting award entitlements.
- Employers not providing specific award entitlements such as laundry allowances, overtime penalties and minimum shift engagements.
We prepare a payroll recommendations document to provide to our franchisor client, which allows compliance issues to be dealt with internally, rather than by involvement of the FWO, which could lead to negative publicity and thereby damaging the reputation of the franchisor’s brand.