In recent posts, we reported on the rise in Fair Work Ombudsman activity in the area of accessorial liability and the impending enactment of the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017.
That legislation has been passed by the Federal parliament and is taking effect in two stages.
Most of the provisions are operative from 15 September 2017 and the provisions relating to franchisors and holding companies come into operation 6 weeks later on 27 October 2017.
This legislation has significant effects in that it:
- Introduces a higher scale of penalties for ‘serious contraventions’ of prescribed workplace laws up from $63,000 to $630,000 per offence for a corporation and from $12,600 to $126,000 per offence for an individual
- Increases penalties for record-keeping failures.
- Makes franchisors and holding companies responsible for underpayments by their franchisees or subsidiaries where they knew or ought reasonably to have known of the contraventions and failed to take reasonable steps to prevent them.
- Expressly prohibits employers from unreasonably requiring their employees to make payments (e.g. demanding a proportion of their wages be paid back in cash).
- Strengthens the evidence-gathering powers of the Fair Work Ombudsman to ensure that the exploitation of vulnerable workers can be effectively investigated.
- Introduces a reverse onus of proof where an employer has not met their record keeping obligations and an underpayment of wages claim is made.
While a focus in the legislation is to get franchisors and parent companies to responsibly supervise and ensure compliance by their franchisees and subsidiaries, any business which sub-contracts work should ensure that they have appropriate compliance systems in place not just on paper but in practice too.
Ridgeline HR can assist by undertaking independent workplace relations compliance audits of franchisees, agencies, subsidiaries, sub-contractors and supply chain partners. These audits cover compliance with:
- National Employment Standards
- Modern Awards
- Record Keeping and Payslip Requirements
- Superannuation Guarantee
- Avoidance of Sham Contracting
For construction businesses needing to be compliant with the Code for the Tendering and Performance of Building Work 2016 so as to be able to tender on and perform Commonwealth-funded work, that can also be included in the audit process.
Enquiries can be directed to Peter Maguire on 0438 533 311 or at firstname.lastname@example.org