Media release

20 July 2009

Watchdog warns employers to check redundancy payments

The Fair Work Ombudsman is warning Western Australian employers to ensure they pay full redundancy entitlements to workers whose employment is terminated.

Fair Work Ombudsman WA Director Leigh Quealy says his office has investigated a number of employers who have inadvertently short-changed workers they have laid off by thousands of dollars.

In the most recent case, a Kwinana-based employer has been requested to reimburse more than $31,000 to five Filipino workers whose jobs were terminated in March.

Mr Quealy says that after receiving no redundancy or termination entitlements when they were put off at short notice, the workers – who spoke little English – complained to his office and the matter was promptly investigated.

He says inspectors have also recently recovered significant redundancy underpayments for other workers, with individual amounts as high as $19,945, $14,875, $6120 and $2865 for four workers.

Mr Quealy says the problem appears to be state-wide across a variety of industries and has appealed to employers to ensure they fully understand their redundancy obligations to staff.

“The tough economic conditions represent challenging times for businesses but they are no excuse for failing to pay workers their full entitlements, and neither is ignorance of workplace law,” he said.

Mr Quealy’s warning comes after his office initiated legal proceedings in the Federal Magistrates Court against a Perth company for allegedly refusing to pay full entitlements to a marketing manager made redundant.

The FWO is prosecuting Plaza Cameras Pty Ltd and company director Ashley George Heuchan, of Willeton.

Court papers allege that the company failed to pay $4792 (eight weeks’ severance pay) to a marketing manager who was made redundant after more than four years full-time work with the company. 

Mr Quealy says the FWO is seeking penalties against the company and Heuchan and a Court Order for repayment of money owed plus interest. The matter is listed for hearing on September 21.

“Redundancy entitlements play a vital supporting role for people while they attempt to pick themselves up, find a new job and get back on their feet,” he said.

The maximum potential penalty for a breach of workplace law is $33,000 for a company and $6600 for an individual.

In January, NSW manufacturing company Planet Floorcoverings Pty Ltd was fined $22,000 and its director Michael Pairidis was fined $900 over a failure to pay eight employees more than $80,000 in redundancy entitlements.

The FWO is an independent Federal statutory agency responsible for educating employers and workers about workplace law and enforcing compliance.

Employers and employees seeking advice on redundancy and termination entitlements should ring the FWO Infoline on 13 13 94 or visit www.fwo.gov.au for assistance

The Fair Work Ombudsman aims to promote harmonious, productive and co-operative workplaces.

Media inquiries:

Craig Bildstien, Director Media & Stakeholder Relations,
0419 818 484
craig.bildstien@fwo.gov.au

Ryan Pedler, Media & Stakeholder Relations Senior Adviser
(03) 9954 2561, 0434 365 924
ryan.pedler@fwo.gov.au

 

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Page last updated: 20 Jul 2009