When do employees lose their entitlement to wages?

We all work. We work during standard work hours, after hours, weekends and sometimes even public holidays. We work with the understanding that we will be compensated for our efforts. But what happens when a worker does less than what was contracted for? Are they still entitled to be paid? An employee’s entitlement to wages usually arises out of the contract of employment. Thus, the first step for any employer will be to examine the contract itself. However, the entitlement to wages, as found under the employment contract, may be modified by legal principles. Accordingly, before you loosen the purse string, it may be prudent to consult with a legal professional to ascertain whether you are obliged to pay.

The employer’s right to deny payment for non-fulfilment of duties

Regardless of whether an employment contract exists, an employee does not have an entitlement to wages where they have not fulfilled their obligations. The type of services that the employee was required to render will depend entirely upon the terms of the employment contract or verbal arrangement between the parties. Nevertheless, the rule stands. No work, no pay!

Defective or partial performance of duties

More often than not, it cannot be said that an employee failed to discharge his or her work obligations in their entirety. The more likely scenario involves the employee discharging some of their responsibilities (part-performance), or all of their responsibilities in a sub-par manner. Is there an entitlement to wages in such circumstances?

The short answer is no. An employee must perform all the duties they contract for under the employment contract or otherwise agreed to. An employer can certainly refuse to accept part-performance of work, provided that, the part performance is substantial and not merely marginal. This will need to be determined on a case-by-case basis. I.E. failure to discharge safety obligations may amount to a substantial failure.

In terms of defective performance, an employer is entitled to reject the employee’s work and, in such a situation, there is no obligation to pay. Once the defective work is rejected, it is of no avail to the employee if they continue to do the work in the hopes of securing a payment.

An employer may elect to accept defective or partial performance. If they do, a duty to pay arises and the employer cannot at this point go back and claim that the work provided was not the work that was contracted for. In such circumstances, the entitlement to wages is the right to full wages, as stipulated under the contract or as per the parties agreement.

Conclusion

Unsure whether an entitlement to wages arises in your particular circumstances? Our LegalVision team of employment lawyers is highly experienced in employment law matters and would be happy to assist you. Contact us on 1300 544 755 to find out what your rights and obligations are.