The Fair Work Ombudsman (FWO) has released its 2024–25 Annual Report, revealing more than $358 million in unpaid wages recovered for over 249,000 workers this year alone. They were not paying correctly.
That’s a staggering figure — and a timely reminder for every employer to ask:
Are we paying correctly — and how do we know for sure?
The Big Picture
The FWO’s findings show that even large, well-established companies are getting it wrong.
- 60% of recovered wages came from large corporates — around $213 million owed to nearly 118,000 employees.
- $47 million was self-reported and repaid through enforceable undertakings.
- $23.7 million in court penalties were handed down — the highest on record.
In total, the FWO has recovered over $2 billion in unpaid wages in just five years.
Why It Happens
Most underpayments aren’t deliberate — they’re caused by:
- Misclassifying employees under the wrong Award or level
- Missing updated pay rates or allowances
- Failing to track overtime or penalty rates accurately
- Outdated payroll systems or manual errors
A few small oversights can quickly add up to a major compliance problem.
What It Means for Employers when not paying correctly
The message from the FWO is clear: payroll compliance isn’t optional.
Every business must have robust systems in place to ensure accuracy — and fix issues fast if they occur.
In 2025–26, the FWO will be focusing on high-risk sectors, including:
- Aged care & disability support
- Building & construction
- Hospitality (fast food, cafés, restaurants)
- Agriculture
- Universities & large corporates
Even if your business isn’t in one of these sectors, compliance expectations apply to everyone.
How to Stay Ahead
- Take a proactive approach:
- Review pay rates and classifications against the latest Awards
- Audit overtime, penalty rates, and allowances
- Train managers to understand their payroll responsibilities
- Implement HR systems that track pay accuracy in real time
Regular wage audits are your best safeguard — and they send a powerful message to your team: we do the right thing, always.
What side of the law are you on: Do this quick check!
Take a proactive approach and book a discovery call with ForgeHR to safeguard your business and support.
Don’t wait for the Fair Work Ombudsman to come knocking — let ForgeHR help you stay ahead.
