Effects of employees being underpaid
The wages and salary of employees are determined primarily by three methods, which are wages under the Australian federal level awards, state level awards, and enterprise bargaining or agreements. The Australian government has been increasing the minimum wage each year to raise the income of the lowest paid workers, and the Fair Work Commission reviews the wages each year. However, the problem of underpayment has not been solved yet, and the situation has become worse recently. The number of low-paid jobs has been increasing in two years and most jobs are in the hospitality industry (Unions New South Wales 2017, p. 4). Underpayment can have a significant impact on employees’ financial situation, health, …show more content…
After the 1st of July 2017, the National Minimum Wage in Australia is $18.29 per hour or $694.90 per week (Fair Work Commission 2017). However, according to the Australian Bureau of Statistics census data, almost one in five households 17% have weekly household incomes of less than A$649. That is more than 72,000 households living on $649 or less per week in a housing market where average weekly rents for apartments in Sydney are $550. Due to rising property and power prices and record low wage growth, underpaid workers cannot afford to purchase or rent a home in the city. When employers pay below minimum wages to their employees, it creates significant problems for low income earners such as struggling to meet their daily life needs, to purchase their weekly groceries, or pay rent and …show more content…
Employees who are not paid their legal wages often receive cash in hand, so there are no work records for either the employer or the employees. This makes it difficult for the government to prove that the employer is failing to meet their legal obligations to the employees (Westjustice 2017, p. 155). As a result, it is difficult for the government to collect tax revenues which pay for all the services that government provides. Often, workers who are not receiving their legal entitlements, sign the employment contracts that they may not understand, or they may not know violate the law. The employment contracts may prevent the employee from making complaints to the Fair Work Ombudsman and may require the employee to accept their pay. In some circumstances, the owners request that the workers sign up the Individual Flexibility Arrangements (IFAs). The arrangement can be used as the method to invalidate the employees’ rights. Some rights which can be lost include penalty rates or
The wages and salary of employees are determined primarily by three methods, which are wages under the Australian federal level awards, state level awards, and enterprise bargaining or agreements. The Australian government has been increasing the minimum wage each year to raise the income of the lowest paid workers, and the Fair Work Commission reviews the wages each year. However, the problem of underpayment has not been solved yet, and the situation has become worse recently. The number of low-paid jobs has been increasing in two years and most jobs are in the hospitality industry (Unions New South Wales 2017, p. 4). Underpayment can have a significant impact on employees’ financial situation, health, …show more content…
After the 1st of July 2017, the National Minimum Wage in Australia is $18.29 per hour or $694.90 per week (Fair Work Commission 2017). However, according to the Australian Bureau of Statistics census data, almost one in five households 17% have weekly household incomes of less than A$649. That is more than 72,000 households living on $649 or less per week in a housing market where average weekly rents for apartments in Sydney are $550. Due to rising property and power prices and record low wage growth, underpaid workers cannot afford to purchase or rent a home in the city. When employers pay below minimum wages to their employees, it creates significant problems for low income earners such as struggling to meet their daily life needs, to purchase their weekly groceries, or pay rent and …show more content…
Employees who are not paid their legal wages often receive cash in hand, so there are no work records for either the employer or the employees. This makes it difficult for the government to prove that the employer is failing to meet their legal obligations to the employees (Westjustice 2017, p. 155). As a result, it is difficult for the government to collect tax revenues which pay for all the services that government provides. Often, workers who are not receiving their legal entitlements, sign the employment contracts that they may not understand, or they may not know violate the law. The employment contracts may prevent the employee from making complaints to the Fair Work Ombudsman and may require the employee to accept their pay. In some circumstances, the owners request that the workers sign up the Individual Flexibility Arrangements (IFAs). The arrangement can be used as the method to invalidate the employees’ rights. Some rights which can be lost include penalty rates or