WA Discrepancy Relating to Overpayment - Employer Not Following Enterprise Agreement?

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ToDoOrNotToDo123098

Active Member
6 September 2018
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Hi all,

I have an odd and rather complex problem I need help with. Note: all figures are approximate for ease of explanation.

Context/background

3 years ago, my employer gave me a increase in pay that I wasn’t entitled to, per Enterprise Agreement. This increase was also backdated.
In effect, I have been:

1) overpaid (over a period of 6months) to a figure of 1500, and,

2) been given a backdated back pay (lump sum) of 3000.

The total amount owing to my employer being 4500. I do not dispute that I owe the employer money.

My point/s of contention

1) The employer has determined that I owe 6000, despite the employer’s own records reflecting that I owe the aforementioned amount of 4500.

2) I have conducted an independent evaluation (using payslips) in consultation with a Chartered Accountant, and have determined the 4500 to be the correct amount owing, and not 6000.

Actions so far - employer and employee

Employee actions

- When I was made aware of money owed, I requested a breakdown of the employer’s 6000 figure. They did not provide requested breakdown until 2 years after initial request was made.

- Upon receipt of the employer supplied breakdown in excel spreadsheet format, it was determined by both the Chartered Accountant and I that the 4500 figure is correct, and 6000 was incorrect. This took/takes less than 30 seconds to do for a person with basic excel spreadsheet skills.

- I have - on my own with little assistance from my union - applied the ‘Dispute Settling Procedure’ prescribed in my Enterprise Agreement.

Employer actions

- Employer has taken 2000 from a ‘discretionary’ bonus due to me to service my debt.

- Continued attempts over the 3 years to recover their money via unreasonable repayment plans without directly addressing my dispute on the discrepancy (4500/6000)

- Continued failure to comply with the dispute settling procedure of my Enterprise Agreement

My Questions

- Have I any legal grounds for redress for an employer not following the Enterprise Agreement dispute settling procedure?

- With the employer’s perpetual stalling and ignorance on the matter (remember, 3 years and still running) this is putting me under mental duress. Is their any legal redress for this aspect?

- I can prove with assistance from a Chartered Accountant that there is a 1500 discrepancy between what the employer state’s I owe, compared to calculated actual’s derived from employer supplied financial material. Is there any redress for this?

- In legal practitioner’s opinion, is it financially economical for a national median income earner to pursue the matter?

- Can the employer take money to service the debt without my consent? E.g. Annual Leave, Overtime, ordinary earnings etc.

Thank you for any assistance.

Other

- My employer is a very large well known entity with considerable resources at its disposal.

- I also have a period of underpayment. I.e. the company underpaid me by 2000 as a result of this issue.

- Fair Work Ombudsman can involve itself, but cannot compel my employer to participate in my Enterprise Agreement Dispute Settling Procedure.
 

Rod

Lawyer
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You involve the Fair Work Commission, not the FWO. The FWC can make binding decisions with or without the involvement of the employer.
 

DMLegal

Well-Known Member
28 May 2018
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I don't understand how you came to owe the employer either amount in the first place? You were given a pay rise which you 'weren't entitled to'? Do you mean your employer accidentally paid you more than they should have for the period because of a computer error or similar?

I any event, while their $6000 might be incorrect, you don't dispute the $4500, so pay that back first.

In answer to your questions:

- Have I any legal grounds for redress for an employer not following the Enterprise Agreement dispute settling procedure? No, the dispute procedure doesn't prevent other methods of redress, i.e. requesting a refund etc.

- With the employer’s perpetual stalling and ignorance on the matter (remember, 3 years and still running) this is putting me under mental duress. Is their any legal redress for this aspect? Nope, unless their demands have been unreasonable and caused a diagnosed mental illness/condition.

- I can prove with assistance from a Chartered Accountant that there is a 1500 discrepancy between what the employer state’s I owe, compared to calculated actual’s derived from employer supplied financial material. Is there any redress for this? You want redress for poor mathematics?

- In legal practitioner’s opinion, is it financially economical for a national median income earner to pursue the matter? I don't think you have a matter to pursue.

- Can the employer take money to service the debt without my consent? E.g. Annual Leave, Overtime, ordinary earnings etc. If it is a legitimate overpayment, yes. Also, technically they aren't 'taking' money, if it is a legitimate overpayment you have taken money, they are merely reducing the amount you are paid to offset it.
 

Rod

Lawyer
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If it is a legitimate overpayment, yes. Also, technically they aren't 'taking' money, if it is a legitimate overpayment you have taken money, they are merely reducing the amount you are paid to offset it.

Employer may have difficulty here. An overpayment, without agreement with the employee, is not a permitted deduction - FWA s 324.

As the employee in any given pay period has earned their pay, all deductions now have to be permitted deductions before the employee's pay can be altered. This would apply to previous overpayments.

The employer has to get agreement, or a court order, or an order made by the FWC.
 

DMLegal

Well-Known Member
28 May 2018
187
33
514
Employer may have difficulty here. An overpayment, without agreement with the employee, is not a permitted deduction - FWA s 324.

As the employee in any given pay period has earned their pay, all deductions now have to be permitted deductions before the employee's pay can be altered. This would apply to previous overpayments.

The employer has to get agreement, or a court order, or an order made by the FWC.

I was a bit presumptuous in that I assumed the question was whether it was legally possible - The employer can if they make a claim through the Courts. Insofar as the part where I said 'they are not 'taking' money see David Securities Pty Ltd v Commonwealth Bank of Australia.
 

Rod

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Yes, sometimes easy to miss stating some assumptions.

I sometimes think equity should have a role to play in statutory law as we seem to be surrounded by populist politicians all too willing to trade away long held rights for votes.
 

ToDoOrNotToDo123098

Active Member
6 September 2018
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31
Hi Rod

Thanks for the guidance. FWC were of the opinion that they couldn’t be involved in anything outside of the EA or NES and that ‘overpayments’ cannot be managed using Dispute Settling Procedures. As a result they <again> referred me to FWO who advise they can instigate a mediation which could assist in possible subsequent litigation.

Hi DMLegal

The overpayment wasn’t instigated/actioned by me but by my employer. I was just cruising along fat dumb and happy then this happened.

I have no issue admitting that I owe money in doing so, I acknowledge that I’ve been overpaid.
The issue with paying the $4500 is -
is that the employer does not agree to that amount. Nor am I willing to enter a payment plan that exceeds it, hence the stale mate as I know that if I enter a repayment plan to the 6000 amount, they will deduct right up to it and then I’d have to try and get that money back from my employer.

So there is no redress for poor mathematics? I am to be out of pocket by 1500 for an error not of my making?
 

Rod

Lawyer
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ATM the problem is theirs. You have the money they want.

They cannot legally deduct it from your wage without your agreement. The only other way they can get the money is through court action and that is unlikely for the amount in dispute.

employer has taken 2000 from a ‘discretionary’ bonus due to me to service my debt

^^ This likely brings the dispute under the Fair Work Act general protections.

Have I any legal grounds for redress for an employer not following the Enterprise Agreement dispute settling procedure?

^^ This is also a ground able to attract the jurisdiction of the FWC.

Without reading the EA and it's dispute settlement clauses I can't be 100% certain but prima facie the FWC can hear your matter - if it is framed the right way.

I suspect the person on the front desk of the FWC is not legally trained or not paying attention or didn't understand the nuances of your matter. They may have just heard - OVERPAYMENT - and decided not within our jurisdiction. And at face value they'd be correct. As they can't give out legal advice there is not wrong with their advice to you.

You could get a lawyer to prepare your application, and then represent yourself OR
Wait till the employer decides to take further action to recover the money owed.
 

ToDoOrNotToDo123098

Active Member
6 September 2018
7
0
31
Thanks Rod,

I’m happy to pm you a link to my EA if you are that interested but you’d have to let me know how because I don’t know.

Interesting - can I say and ask objectively, your guidance is contradictory to that opinion proffered by DMLegal and those of FWC and FWO. How do you figure that a correctly ‘framed’ case would look like and able to be submitted to FWC for hearing?

I would have to take all reasonable steps for litigation to be successful however, what would be annoying is if my employer whipped around half way through proceeding and conceded their error. In which case I would then need to decide to pursue legal cost recovery which would negate the 1500 discrepancy.

You can understand my predicament.


On a separate note:

I am deeply interested in subscribing to a magazine or periodic journal relating Australian industrial relations similar to this Industrial Relations | Wolters Kluwer | Australia

Can anyone provide me with a way in which to keep up with occurrences relating to IR and associated commentary from legal practitioners?
 

Rod

Lawyer
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This forum doesn't permit PMs. The way to solve the problem is post the EA online and share the link, however I don't know if confidentiality rules will be broken if you do so.

Interesting - can I say and ask objectively, your guidance is contradictory to that opinion proffered by DMLegal and those of FWC and FWO

Happy to :)

First - the FWC and FWO do not offer legal advice. They cannot, and must not, advise you on the legal aspects of your matter. Your matter is not a straightforward matter and requires an understanding of the facts in dispute and how to apply the law to those facts. If you ask the FWC how to fill in a form they'll tell you in general terms. Or if you say you have been unfairly dismissed they might tell you to use the unfair dismissal form. They are unlikely to tell you which is the correct form for your matter (EG form 10) because they would have to look at the facts and work out which is the correct form. This has legal implications if they get it wrong so they cannot tell you.

Second - there is no real conflict between DMLegal and me - DMLegal was applying a different area of law (take your pick of restitution, set-off, unjust enrichment) covering over-payments while forgetting that there is a statutory requirement covering pay deductions in the Fair Work Act for employment related matters. If your matter was NOT related to pay deductions DMLegal would be correct.

I understand your predicament but as I am not yet a lawyer I can't help you with specific advice, I can only give an opinion. My last post highlighted two facts likely to allow the FWC to hear your matter. The first is a general protections claim due to adverse action (withholding an eligible bonus), the second fact is the employer not following the EA which MAY attract use of the FWC form 10.

I do not subscribe to IR magazines/newsletters and have not looked at which might be considered good value. IR is wider than my interest - I prefer the legal challenges around employment contracts and disputes.

And thank you - you have given me a business opportunity on which I need to ruminate!