It’s all over the news – we all know it – failure to pay workers the right amount has devastating impacts on employers and their employees. But what is the actual impact for your business?

Financial Impact:

In Australia, the Fair Work Ombudsman is responsible for ensuring that workers are paid in alignment with labour laws. Failing to comply with these laws can result in huge fines and penalties, potentially crippling some businesses. Over the last few years the Fair Work Ombudsman has handed out more fines than ever before – that’s not a record anyone is happy about breaking!

When workers are not paid correctly, it is not only the fine that needs to be dealt with. Businesses will also have to make back-payments to all underpaid staff. In the last two years, there have been MILLIONS of dollars paid back to workers. Can the cash flow of your business afford this? Most staffing agencies couldn’t. There goes this years’ profit… and next years’… and possibly the whole business.

Then here comes the legal disputes for underpayment, unpaid wages and potentially additional complaints of unfair dismissal and discrimination. Add litigation expenses to that ever-growing list of things your business can’t afford.

Reputational Impact:

Our workers ARE our company. They are the face of our organisation, they are our brand, our image. So when staff are underpaid, it shouldn’t be surprising that public perception of who we are takes a huge knock. Online news and social media allow reports, or even whispers of workers being paid unfairly spread like wildfire. Shall we add your company reputation to the things that are quickly going down the drain?

As more and more workplaces are being named and shamed for violating labour laws, Australians are getting increasingly concerned about the treatment of workers and taking more notice when underpayment is raised in the news. I bet you can immediately think of some big brands that have recently been caught underpaying staff. That kind of exposure is long-lasting, and definitely not the kind of brand-advertising you’re after.

And let’s now also consider that we are in candidate-short market, where good employees are hard to find. How are you going to attract and retain great talent if you’re known as a business that doesn’t pay their workers fairly? It’s going to be hard to grow and be competitive in your market without great candidates.

Final Thoughts: Morals and Ethics

Let us remember, also, that complying with the laws and regulations of the Australian labour market is more than just a legal obligation with financial and reputational ramifications. It is a responsibility that employers, including recruitment agencies, must abide to both morally and ethically.

If Australia is still “the lucky country”, we need to be an undeniably fair country to work in. “Honest day’s work for an honest day’s pay”, right?



Let’s get it right.