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The Fair Work Act fights back to protect vulnerable workers

Following the outbreak of the 7/11 underpayments scandal in 2016, the Australian Government responded to the controversy by introducing the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 (“Bill”). In September last year the Bill passed through parliament, bringing with it a series of significant amendments to the Fair Work Act 2009 (“FWA”) designed to prevent the deliberate and systematic exploitation of vulnerable workers, such as migrants and those who work in the franchisee sector.

All employers, particularly franchisors and holding companies, should be aware of the changes and how they are likely to affect business operations. Those who breach the new laws can expect to face hefty penalties, along with the wrath of the all-powerful Fair Work Ombudsman (FWO), who does not take contraventions of Australian workplace law lightly. The FWA amendments include the following:

  1. Introducing higher penalties for ‘serious contravention’ of workplace laws

Employers who engage in ‘serious contraventions’ risk facing substantial financial penalties, which now stand at $126,000 per contravention for individuals and $630,000 for corporations. A

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Accountancy firm held liable for client’s breaches of the Fair Work Act

Recently, the issue of accessorial liability has been at the forefront of the Fair Work Ombudsman’s (FWO) agenda and it’s not a subject being taken lightly.

The Federal Circuit Court recently handed down a decision in a case that dealt with third party advisers who were knowingly aware of their client’s breaches of the Fair Work Act.

Accountancy Firm, Ezy Accounting, was found liable as an accessory for its involvement in a Japanese restaurant operator’s underpayments to its staff. The contraventions included failure to pay the minimum hourly rate of pay, the evening loading, the Saturday and Sunday loading, the public holiday penalty rate, the special clothing allowance, and failure to provide rest breaks and meal breaks.

Ezy Accounting was alert to the fact that the restaurant was failing to meet award obligations and paying their staff incorrect rates, however the company chose to “deliberately shut its eyes” to the contraventions occurring. Whilst the Court is yet to make a determination on the penalties against the accountancy firm, it could

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A tougher FWO to protect Australia’s vulnerable workers

The Turnbull Government is following through with its election promise to deliver greater protection to Australia’s vulnerable workers by strengthening the powers of the Fair Work Ombudsman.

In early 2017, new laws will be introduced that will enhance the FWO’s examination powers and expressly prohibit employers from providing false and misleading information to Fair Work Inspectors. The Government also plans to increase the penalties (up to ten times the current maximum) that apply to employers who underpay workers or who fail to keep sufficient employment records.  The intention is to deter businesses from engaging in practises that exploit vulnerable workers and to equal the playing field for compliant businesses doing the right thing.

In addition, a migrant workers taskforce has been established to improve employee protections for overseas workers. One of the key functions of the taskforce is to monitor 7-Eleven’s progress in rectifying their breaches which included the significant underpayment of wages, the manipulation of the payroll system and the doctoring of false employment records. The taskforce, chaired by

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The Fair Work Ombudsman (FWO) has recently commended McDonald’s Australia for conducting a self- audit on its employees’ wages and other entitlements, leading to improved workplace relations for the 90,000-strong restaurant chain.

McDonald’s had agreed to participate in the self-audit following an unsuccessful attempt to have an enterprise agreement approved by Fair Work Australia. Although the enterprise agreement was approved on appeal, McDonald’s agreed to enter into a Deed to achieve two compliance activities:

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