Building and construction employers are being put on notice by the Fair Work Ombudsman in a joint audit with the QBCC and ABCC with a particular focus on underpayments.

In some cases, the Fair Work Ombudsman can fine an employer up to $666,000 for underpaying its employees.

A recent case commenced by the Fair Work Ombudsman against a Victorian building company has indicated that employers in the building and construction industry may not be in compliance with the Building and Construction Award by not properly calculating the appropriate allowances and appropriate rates of pay.

A report undertaken by the Australian Building and Construction Commission in 2018 has indicated that while over 70% of building and construction employers are compliant with their basic payment obligations, a vast majority of employers are misinterpreting Award provisions relating to allowances.

In some cases, small errors in the misuse of allowances can lead to significant underpayments when extrapolated over a large workforce over a number of years.

What Sort of Allowances Apply to the Building and Construction Industry?

Building and Construction allowances include but are not limited to:

  • Specific conditions associated with the worksite eg: multistorey allowance, underground allowance and wet weather allowance.
  • Travel allowance associated with on-site work.
  • Additional skills that may be required to perform certain types of work eg: electricians licence allowance, scaffolding certificate allowance, and other specific occupation allowances.

What Can I Do?

  • Ensure an up-to-date interpretation and understanding of the Building and Construction Award 2020.
  • Ensure that your business has the appropriate payroll configuration as it relates to your employees Eg: appropriate rate of pay, classification and allowances.
  • Contact the team at wattsnext to conduct an audit of your current payment arrangements to ensure your business remains legally compliant.


Author: wattsnext Group
The wattsnext Group blog is a compilation of ideas and expertise from the entire team, past and present with a few added gems from guest authors from time to time. With this collaborative approach, we can provide you with a broader perspective and high-level expertise across the small business landscape.