One of the changes to the Fair Work Act as part of the ‘protecting vulnerable employees’ amendments, that has slipped under some employers’ radar is section 557C. This provision reverses the onus of proof where there is a dispute about the number of hours an employee has worked.
In a recent federal court case, the employees kept their own records but the employer did not record what hours were worked. When it came to a dispute about how much work was done, in the absence of any proof to the contrary, the court accepted fully the employees’ claims.
The matter was an appeal from a lower court which found some of the employees’ claims had lacked credibility. But the appeal judge dismissed this as irrelevant, saying the onus was squarely on the employer to come up with the evidence that the claims were spurious, or exaggerated. Having failed to do so, the appeal court doubled the amount of compensation, all based on the employees’ personal time records.
The importance of this case is that it was no use simply questioning the hours claimed; that is not the test. Rather, the legislation shifts the burden to the employer to disprove, not merely dispute, those claims. If the Regulations require a particular record to be kept, and it isn’t, then in the absence of some other compelling evidence, employees’ claims will be upheld.
Many employers do not keep start/finish times records because there is a fairly regular or consistent pattern of work. If an award or enterprise agreement prescribes different rates for different times of day, then merely recording a total number of hours worked would leave an employer vulnerable to the same sort of action that occurred in this case.
And to add to the bureaucracy, recent changes to modern awards where a salary is paid in lieu of all the various wage, overtime, penalty and allowance components of pay, mean that detailed records are required for compliance purposes. Employers need to check carefully if they are meeting their record-keeping requirements, both from the perspective of legal obligation to do so and to protect themselves from claims as happened here.