NEW LAW PASSED SENATE Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017
Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 passed
The Turnbull Government’s legislation protecting vulnerable workers amendment bill has now passed the Senate. It will now head for Royal Assent (approximately two weeks) and become effective immediately. Although some clauses give a six week implementation period.
This legislation targets the Franchise industry in particular where there have been quite a number of Fair Work Cases where employers have been acting unscrupulously.
The Minister for Employment, Michaelia Cash said “the strengthened penalties contained in this Bill will act as a significant deterrent to unlawful practices. They will also ensure that the small minority of unscrupulous operators think twice before ripping off workers.
The new law means there will be a higher scale of penalties (up to 10 times the current amount) for a new category of ‘serious contraventions’ of prescribed workplace laws.
These penalties have increased to $630,000 for a Corporation, and $126,000 for an individual. Penalties related to failure of record keeping/payslips, increases to $63,000 for a Corporation and $12,600 for individuals.
Summary of the Protecting Vulnerable Workers Amendments, include:
- Introducing stronger provisions to make franchisors and holding companies responsible for breaches of the Fair Work Act. Certain franchisors and holding companies become responsible for underpayments by their franchisees or subsidiaries where they knew, or reasonably ought to have known, about the contraventions and failed to take reasonable steps to prevent them.**
- The legislation also means the onus of proof has shifted - employers will be forced to prove they pay their staff correctly if they are investigated for underpayments.
- expressly prohibiting employers from unreasonably requiring employees to make ‘cash-back’ arrangements
- strengthening the evidence gathering powers of the Fair Work Ombudsman to ensure that the exploitation of vulnerable workers can be properly investigated
- New penalties for providing Fair Work inspectors with false or misleading information or records, and new prohibitions for hindering or obstructing them.
**Where a franchisor has a degree of influence or control over their business networks, the legislation means that franchisors will be held responsible for underpayments by their franchisees where they knew or should have reasonably known of the contraventions and failed to act to prevent the practices.
What should business owners do now?
We recommend businesses of ALL sizes review their Employment Practices now to ensure full compliance and not get caught out. In particular, Franchisors and Franchisees should conduct an extensive review to ensure compliance immediately.
To assist businesses in this process, we've decided to open up our comprehensive online HR Audit Tool to businesses for free for a limited time.
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This article is intended to provide commentary and general information. It should not be relied upon as comprehensive or legal advice. Formal legal advice may be necessary in particular transactions or on matters of interest arising from this article. The HR Experts International is not responsible for the results of any actions taken on the basis of information in this article, nor for any error or omission in this article.