Another major Australian employer has been accused of underpaying staff, with Seven West Media now facing a class action over alleged breaches of workplace entitlements. While the case will play out in the courts, the headlines alone are a stark reminder that payroll is not simply about paying people on time. It is about accuracy, compliance, and protecting both employees and the business.
The cost of getting payroll wrong
When payroll errors are systemic, the consequences can be far reaching. Allegations of underpayment rarely stay behind closed doors. They damage trust with employees, erode brand reputation, attract regulatory attention and often end up costing far more than the original errors through fines, back payments, and legal fees.
In Profit from Payroll, I highlight that once a business is flagged as having compliance issues, it is difficult to restore confidence among staff. Employees who feel they cannot rely on their employer to get their pay correct lose trust, which impacts morale, productivity, and turnover.
Why underpayments happen
The reality is that most large scale underpayments are not driven by intent to short change staff, but by complexity, poor processes, or outdated systems. Australia's mix of federal and state legislation, modern awards, enterprise agreements, superannuation obligations, and tax rules makes payroll one of the most complex functions in any organisation.
Too often, businesses assume their payroll processes are sound, only to discover gaps when regulators or employee representatives investigate. Manual data handling, inadequate interpretation of awards, and a lack of qualified payroll professionals all increase the risk of error.
Preventing underpayment scandals requires treating payroll as a professional, compliance driven function rather than a back office task. The key actions include:
Regular compliance reviews: payroll processes should be mapped, tested, and audited frequently, not only after a new system implementation.
Investment in payroll qualifications: trained and accredited payroll professionals bring the expertise to interpret legislation and manage risk.
Leveraging technology effectively: modern payroll systems, time and attendance tools, and self service portals can automate complex calculations and reduce manual error, but only if implemented and configured correctly.
Clear documentation and segregation of duties: defining responsibilities and maintaining robust records protects against both mistakes and fraud.
Proactive communication: keeping managers and employees informed about entitlements and legislative changes prevents misunderstandings and builds confidence in payroll.
Payroll is a risk and a responsibility
The Seven West Media case will not be the last time we see payroll in the headlines for the wrong reasons. But it does highlight the need for every business, regardless of size, to ask a critical question: are we confident our payroll is right?
Getting it right requires more than pressing a mythical "payroll button". It demands skilled professionals, investment in the right systems, and an organisational culture that values compliance as much as cost efficiency. Because when payroll fails, the cost is always higher than the investment it would have taken to get it right.
