The role of legal expertise in wage audits
Dean Tolkin discusses the unique value lawyers bring to wage audits, from ensuring correct award classifications to providing legal protection through professional privilege, safeguarding employers from potential liabilities and government scrutiny.
About the speaker
Dean was shortlisted as a finalist in the Lawyers Weekly 30 under 30 Awards for Workplace Relations, Employment and Safety for three consecutive years (2017 – 2019) and was fortunate to have won this prestigious award in 2018. Dean was also recognised in 2018 in the Australian Law Awards as a finalist in the categories of Rising Star of the Year and Senior Associate of the Year and has been recognised as a leading employment law specialist.
Summary
In this insightful discussion, Dean Tolkin highlights the critical role of legal expertise in wage audits and how businesses can benefit from lawyers' specialised knowledge. Wage audits are more than just payroll checks—they involve complex award classifications, employment law compliance, and risk mitigation strategies that require a legal perspective.
By leveraging legal expertise, businesses can ensure that their wage audits are accurate, defensible, and compliant with Fair Work Australia standards. Lawyers provide valuable legal protection through professional privilege, which shields sensitive wage audit findings from being used against employers in disputes or government investigations.
With the increasing scrutiny from regulators and the rise of wage underpayment scandals, businesses need to take a proactive approach in ensuring they are paying employees correctly while also safeguarding themselves from potential liabilities.
Key topics covered
- The role of lawyers in ensuring correct award classifications
- How legal privilege protects wage audit findings from litigation
- Strategies to minimise compliance risks and employer liabilities
- How wage audits help businesses avoid Fair Work penalties
- The legal implications of misclassifications, underpayments, and payroll errors
- Best practices for businesses to work with legal professionals in wage compliance
Watch the full interview to gain expert insights into how legal expertise can protect your business and ensure compliance with workplace laws.
Transcript
0:00
I think the unique value that lawyers bring to the process is that, you know, we understand awards extremely well. They are very complicated industrial instruments and from what I've seen from other providers, they tend to crunch the numbers and do that inside of the analysis reasonably well. But if effectively you've misclassified someone under the award, the rest of the audit is potentially incorrect and of no value to the client. So we take a very measured and clear approach in the way that we conduct these orders.
0:31
We start at the ground level. We need a job description. We need to ensure that the person is classified correctly by the employer. As I say, that's that starting proposition is incorrect. The numbers are not reliable. So we make sure that we classify the person correctly.
0:46
We've got all the information that we need to conduct the audit. As I say, pay slips, time sheets, working hours, all that information. And once we have all of that, then we can conduct the audit number crunching.
0:58
You know, as I said, there are lots of different providers that do that. The other value proposition that lawyers provide in in the process is that, and this is essential, our recommendations or findings at the end of the audit are covered by a professional legal privilege. Meaning that the Fair Work Ombudsman was to knock on an employer's door one day and say, provide us with any information that you've got regarding audits or underpayments or anything like that. The employer would be obliged to hand it over.
1:25
And so with the protection of legal privilege, those documents and communications without firm are not required to be produced to the Fair Work Ombudsman because they've been provided in the course of providing legal advice to the clients.
1:37
Obviously, if an accounting firm, for example, was having those communications and found that it'd be a significant underpayment liability or any liability that wasn't then rectified by the employer, that could, you know, potentially put that employer at, you know, some significant disadvantage or create issues for them in dealing with the federal combustment.
1:55
So that's the other very attractive part about using lawyers to conduct these audits, is that all of those communications are confidential and highly privileged.
