Many mainstream media outlets have reported a story this week about a bartender who took to social media after he was docked five hours from his paycheck, but what are the rules for employers regarding this?
The bartender posted on Reddit that he had been deducted five hours of pay for ‘mobile phone use’ after, “single-handedly working at the place from open to close. I did use my phone when there were no customers.”
Understandably the Reddit platform was outraged by the owner’s actions with many people recommending the bartender contact Fairwork.
Then, the owner of the bar, Birdies Mini Golf and Sports Bar in Forest Hill, Victoria, hit back saying the worker had received multiple warnings on previous shifts for his “excessive personal mobile phone use”, which included watching movies during his shift.
Sole owner Stephanie Doyle said: “He’d been warned his phone usage was excessive, he was reminded of the policy, said he wouldn’t do it again.
“I don’t have a problem with someone checking their messages as a 20-second thing and then it goes back in their pocket, but we are talking about five-plus hours of being on his phone and ignoring clear directions to stop that behaviour and to do specific tasks.”
She also said that on the shift when the employer was docked she had called him and told him to get off his phone and work at least 12 times, telling him at least five times that his phone use was excessive and he would not be paid for all of his shift if it continued.
So what are the rules around taking money out of an employee’s pay?
According to Fairwork, an employer can only deduct money if: “he employee agrees in writing and it’s principally for their benefit; it’s allowed by a law, a court order, or by the Fair Work Commission, or it’s allowed under the employee’s award, or it’s allowed under the employee’s registered agreement and the employee agrees to it.”
Examples include salary sacrifice arrangements or additional payments into an employee’s super fund.
Fairwork also states: “An employee’s written agreement must be genuine. They can’t be forced to agree to a deduction. Deductions have to be shown on the employee’s pay slip and time and wages records.”
Adding: “An employer can’t deduct money if: it benefits the employer directly or indirectly and is unreasonable in the circumstances, or the employee is under 18 years of age and their parent or guardian hasn’t agreed in writing.
“This is the case even if the deduction is made in accordance with an award, registered agreement or contract.”
The Shout spoke to Sean Wilson CEO & Managing Director of Better HR, a HR company that provides tools, software and advice to help organisations operate successfully and meet their legal obligations.
Sean said that in this case, it could be hard for the employer, but they could potentially make a couple of arguments if there was enough evidence.
He told The Shout: “The employer could argue that the employee accepted the deduction by agreeing in writing to the new policy.”
Sean added: “The employer could argue that the deduction was principally for the employee’s benefit. As it was significantly better for the employee than the alternative. Which was terminating the employee for serious misconduct after numerous warnings. Termination would have cost the employee more in terms of lost pay, damage to future career opportunities, etc.
“In the end, it comes down to how strongly the employer can argue that it was ‘reasonable under the circumstances’ in accordance with the law.”
He also said the Fairwork point regarding ‘agreement in writing’ allows employers to make agreements with employees to make deductions from their pay.
“BetterHR provides subscribers with best-practice templates in our letter wizard. To help generate compliant payroll deduction agreements with employees. Such as when: the employer accidentally makes an overpayment in the payroll; an employee resigns and fails to give notice of termination in accordance with their award; the employee requests to use work property for private use (eg. phone, car, tools of trade, etc).
“It’s unlawful to deduct money from employee’s pay for till shortages and cashback schemes.”
You can find out more about BetterHR on the company’s website, and the rules around pay deductions are on the Fairwork website.