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HR team "should have known better": FWC bench

A recent case before the Fair Work Commission (FWC) highlighted the importance of timely and appropriate responses from Human Resources (HR) teams regarding employee entitlements. In the matter of Health Services Union v Mercy Hospitals Victoria Ltd T/A Werribee Mercy Health [2024] FWCFB 235, the FWC full bench criticized a public health provider's HR team for its handling of queries about late payment of 'nauseous work' and education allowances for approximately 220 employees.

HR team "should have known better": FWC bench
HR team "should have known better": FWC bench

The FWC found that Mercy Hospitals Victoria breached its covering agreement by failing to pay these allowances promptly. Despite Commissioner Sophie Mirabella's earlier ruling that the delay amounted to an underpayment, she did not impose a penalty for the four-month delay in rectifying the issue.

The union argued on appeal that the HR manager's response to an email requesting details about wage increases and back pay did not meet the agreement's requirement to "take steps" to rectify underpayments within 24 hours. The FWC full bench agreed, stating that the HR manager's response did not meet the agreement's requirements. The bench found that the HR team did not take adequate steps to rectify the underpayment and failed to provide confirmation to the employees of the correction within the required timeframe.

The bench criticized the HR team for ignoring correspondence from the union and failing to respond appropriately. They stated that the failure to pay the allowances within a reasonable timeframe was unacceptable, especially considering the nature of the allowances for nauseous work and education incentives. The bench concluded that Mercy Hospitals' conduct was inappropriate and reprehensible, whether it was deliberate or due to incompetence or a breakdown in communication within the HR and payroll staff.

In redetermining the dispute, the FWC full bench found that Mercy Hospitals Victoria was required to make a penalty payment calculated at 0.2% of the unpaid allowance/s for each day they were not paid.

This case serves as a reminder to HR teams to ensure timely and appropriate responses to inquiries about employee entitlements, as failure to do so can lead to significant penalties and reputational damage.

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