By John Salter

The Federal Government has passed new legislation which will make the completion and retention of accurate records by Employers of all matters associated with employment more important than it has ever been. It has also extended the obligations of franchisors to ensure their franchisees are properly paying employees and keeping up to date an accurate records.

These amendments to the Fair Work Act, effective almost immediately, are in response to a number of inquiry reports that identified wholesale exploitation of vulnerable workers, particularly young people from overseas, as was exposed in the 2016 7 Eleven controversy, and the inquiry into the use of labour hire within the Baiada group in NSW.

The main changes are-

  • Introducing significant higher penalties (10 times the current level) for employers and individuals who engage in serious contraventions of workplace laws and/or fail to keep required work place records.
  • Making Franchisors and holding companies responsible for underpayments or other forms of worker exploitation by their franchisees or subsidiaries.
  • Strengthening laws regarding deductions from employees’ pay and prohibiting demands that workers pay part of their earnings back to the employer,  such as the ‘cash back“ scandal at 7 Eleven.
  • Installing a reverse onus of proof in underpayment claims- employers will have to prove that they correctly paid staff, rather than workers or FWO inspectors having to establish that they were underpaid.
  • Providing the Fair Work Ombudsman’s office (FWO) with much greater evidence gathering powers, including coercive powers in certain circumstances.

This will place a much greater focus on the accurate recording of all the required employment related information.  For Franchisors the onus will be very significant. Those records not only include the personal details of employees but all information which is necessary to establish compliance with employment contracts, employment related laws and any Fair Work Award which applies to the work being performed, and there are 122 of them!! It will also make completion of contracts of employment and/or letters of appointment/engagement all that more important.

If you need any advice or guidance on any of your employment related compliance obligations or seek further information please contact BT Lawyers IR Consultant John Salter via [email protected]