Vulnerable workers bill: Don’t fall short of the new rules

Employers and franchise operators take note. Stiff new penalties are about to come into force after reforms to protect vulnerable workers passed the Senate.

The Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 also gives the Fair Work Ombudsman more muscle for evidence gathering to ensure they can carry out investigations into in the most productive manner.

The bill significantly boosts fines for serious breaches of workplace laws. Individuals and businesses can be fined up to 10 times more than for breaches than in the past.

For individuals, it’s now up to $126,000 per breach. And for corporations, $630,000 per breach. Serious contraventions are defined as situations where you engage in a systematic and deliberate pattern of behaviour that undermines the Fair Work Act.

As part of the new regulations, additional protections are being brought in that include:

  • expressly prohibiting ‘cash-back’ arrangements where employers force employees to hand back part of their income
  • increased penalties for breaches of pay slip requirements and record-keeping
  • new penalties for giving false or misleading information, or hindering or obstructing FW investigations.
  • making franchisors and holding companies responsible for breaches of the Fair Work Act in certain circumstances where they are culpable for the breaches.

Franchisors and holding companies

The need to make franchisors responsible was recommended by Alan Fels, the former chief of the Australian Competition and Consumer Commission. Under the new rules, franchisors and holding companies can be held responsible if their franchisees or subsidiaries don’t follow workplace laws.

The legislation extends the Fair Work Act to make a franchise entity or holding company liable for things like underpayments if it is found they “knew or could reasonably be expected to have known” about a contravention of a workplace law.

Reverse onus of proof

Under the new regulations, it’s also important to understand that there’s a reverse onus of proof. What this means is that if you don’t provide your employees with accurate payslips or keep accurate records and an employee makes an underpayment claim, you will need to prove otherwise.  And it’s fair to say that disproving wage claims in court without substantial records will be very difficult.

To make sure your business doesn’t fall foul of these new regulations to protect vulnerable workers, automate your HR and payroll processes. Using an all-in-one HR system like Employment Hero with fully integrated HeroPay payroll can dramatically improve all areas of workplace compliance, giving you peace of mind that you’re meeting your legal requirements. Request a demo of Employment Hero today.

Free eBook

For more great reading and information on your compliance obligations as an employer in Australia, download our essential guide to HR compliance.

Know the HR compliance essentials and avoid a costly mistake. Get your free guide here.

Employment Hero is Australia's first all-in-one cloud HRIS offering a comprehensive HR software, payroll system, and employee benefits platform in one easy solution. Trusted by Australian businesses, Employment Hero is about making rostering, onboarding, performance management, time tracking, payroll, and award interpretation a snap. Employment Hero’s HRIS also integrates with Xero, MYOB, KeyPay, and Accountright Live. Stop wasting time with spreadsheets, and request a demo today.

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