If You Run Payroll, Courts Say You Knew What Was in It: HR Officers Now Face Personal Civil Penalties

A Court Case Every Australian Worker Should Know About

On 23 April 2026, the Federal Circuit and Family Court made a decision that quietly shifted the ground beneath every payroll department in Australia.

In Sha v Snap Innovations, the Court declined to strike out civil penalty claims brought against an individual HR officer who had access to the company’s payroll system. The allegation: that by having system access and processing payroll, the officer was “knowingly concerned” in the employer’s contraventions of the Fair Work Act 2009.

The Court’s reasoning was direct. If you have access to the payroll system, you can see what workers are being paid. If you can see what workers are being paid, you are in a position to know whether those payments comply with the law. And if you are in a position to know, the Court may infer that you did know.

For workers, this is a significant development. It means the people processing your pay can now be held personally accountable when something goes wrong.

What Is Accessory Liability Under the Fair Work Act?

Section 550 of the Fair Work Act states that a person who is “involved in” a contravention of the Act can be treated as having contravened it themselves. Being “involved in” includes being “knowingly concerned” in the contravention.

Historically, this provision targeted company directors and senior executives. The logic was straightforward: those at the top set wages policy, so they bear responsibility when wages fall short.

But Sha v Snap Innovations extends that logic further down the organisational chart. The Court found that an HR officer with payroll system access had an arguable case to answer, precisely because system access creates a reasonable inference of knowledge.

What “Knowingly Concerned” Means in Practice

For a person to be “knowingly concerned” in an underpayment, they must have:

Knowledge of the essential facts that make up the contravention
An understanding that those facts constitute a breach (or the means to acquire that understanding)
Some form of participation in the contravention, even if passive

What the Sha decision clarifies is that the first element, knowledge, can be inferred from system access alone. You do not need to have personally approved the underpayment. You do not need to have designed the pay structure. If the payroll system was open to you and you processed payments through it, the Court may find you had sufficient knowledge.

Why This Matters for Workers

This is not a technicality. It changes the practical landscape of wage recovery in Australia.

1. More People Can Be Held Accountable

Previously, if your employer underpaid you, your recourse was primarily against the company. If the company was insolvent, wound up, or simply refused to pay, recovering your entitlements became difficult.

Now, individual HR and payroll officers can face personal civil penalties under the Fair Work Act. These penalties can reach $18,780 per contravention for an individual (as at 2026). That creates a powerful incentive for every person in the payroll chain to ensure compliance.

2. Deterrence Works Both Ways

When only directors faced personal liability, payroll officers had limited personal incentive to flag problems. They could process payments as instructed and leave compliance questions to management.

That position is no longer safe. If you process payroll and the payments are wrong, you may now share liability. This means workers benefit from an expanded group of people who have strong personal reasons to get your pay right.

3. It Strengthens Underpayment Claims

For workers pursuing underpayment claims, the ability to name individual respondents alongside the employer strengthens the claim in several ways:

Additional sources of recovery if the company cannot pay
Stronger pressure to settle when individuals face personal exposure
Greater cooperation from witnesses who want to limit their own liability
Improved documentation as payroll officers protect themselves by keeping better records

4. It Recognises How Modern Payroll Works

Modern payroll systems are transparent by design. They log who accessed what, when, and what changes were made. The Court’s approach in Sha reflects this reality: if the system shows you had access and processed payments, the inference of knowledge follows naturally.

What This Does Not Mean

It is important to be clear about the boundaries of this decision.

The Court did not find the HR officer liable. It found that the civil penalty claims were arguable and should not be struck out at a preliminary stage. The matter will proceed to a full hearing where the officer will have the opportunity to defend the claims.

The decision also does not mean every payroll clerk is automatically liable for every error. The “knowingly concerned” test still requires knowledge of the essential facts. A genuine data entry error, without awareness of the underlying underpayment, may not meet that threshold.

However, the direction of travel is clear. Courts are increasingly willing to look beyond the boardroom when it comes to personal accountability for wage contraventions.

Five Steps Workers Can Take Right Now

If you suspect you are being underpaid, this decision gives you additional tools. Here is how to use them.

Request your payroll records. Under the Fair Work Act, you have a right to access your employment records. Ask for copies of your payslips, time sheets, and any payroll system reports relevant to your role and classification.
Check your pay against your Award or enterprise agreement. Identify your correct classification, then compare your actual pay (including base rates, penalty rates, overtime, allowances, and superannuation) against what you are entitled to receive.
Document everything. Keep copies of all payslips, rosters, and communications about your pay. If you raise a concern with your employer, put it in writing and keep a copy.
Understand who processes your pay. Knowing which individuals have access to payroll systems may be relevant if you need to pursue an underpayment claim. This is not about targeting individuals unfairly; it is about understanding the full picture of accountability.
Seek assistance early. The Fair Work Ombudsman can investigate underpayment complaints at no cost. For complex matters, a workplace lawyer or union representative can advise on your options, including whether accessory liability claims against individuals may be appropriate.

The Bigger Picture: Accountability Is Expanding

Sha v Snap Innovations is part of a broader trend in Australian employment law. Over the past several years, Parliament and the courts have steadily expanded the consequences of wage theft and underpayment:

Criminalisation of wage theft under the Closing Loopholes amendments, with penalties of up to 10 years imprisonment for intentional underpayment
Increased civil penalties for both companies and individuals
Enhanced Fair Work Ombudsman powers to investigate and prosecute
Expanded accessory liability reaching further into organisational structures

The message from the courts and Parliament is consistent: paying workers correctly is not optional, and accountability does not stop at the company name on the letterhead.

What This Means for Your Next Pay Cycle

Every time you receive a payslip, someone processed that payment. Someone had access to the system that calculated your base rate, your penalty rates, your leave accruals, and your superannuation contributions.

After Sha v Snap Innovations, that person now has a personal stake in getting it right. That is a meaningful shift in the balance of power between workers and the systems that pay them.

Your entitlements are not just your employer’s responsibility. They are the responsibility of every person in the chain who had the access and the ability to ensure you were paid correctly.

Know your worth. Check your pay.

Justiico analyses your payslips against your Award entitlements in minutes, highlighting discrepancies so you can take action with confidence.

Check Your Pay Now