Do you comply?

The Government has recently introduced harsher penalties for employers who fail to comply with FWA and in particular around keeping accurate wage records?

Under the new law, employers can face penalties up to 10 times for a new category called ‘serious conventions’.

So, what are the changes?

 Vulnerable Workers

The Fair Work Amendment (Protection Vulnerable Workers) Act 2017 now provides a maximum penalty for a ‘serious contravention’ is $126,000 (from $12,600) per contravention for individuals and $630,000 (from $63,000) per contravention for corporations.

A vulnerable worker includes: young workers, recent immigrants, aboriginal peoples, older workers, those new to their jobs or working for new businesses, temporary foreign and seasonal workers, workers holding multiple, part-time or low-paying jobs, and workers involved in temporary employment).

Record Keeping Failures

The Act prohibits an employer from making or keeping employee records or providing pay slips that the employer knows are false or misleading.

Employers that do not comply with record keeping obligations and cannot give a reasonable excuse for non-compliance will have to disprove any wage related claims made in a court. Keeping accurate records is the best defence against underpayment claims.

Below are more details on exactly what individual employee details are required to be kept along with what information is required to be included on pay slips.

‘Cash-Back’ Ban

Within the new Act, employers are banned from directly or indirectly requiring an employee to spend, or pay an amount of money or part of the employee’s wage if the requirement is unreasonable; and if the payment is directly or indirectly for the benefit of the employer.

Increased Liability For Franchisors

From 27 October 2017, the Act has important implications for franchisors.   In the event of a franchisee’s non-compliance, franchisors will have greater liability and potential penalties where they had a significant degree of influence or control over the franchisee’s affairs and knew or could reasonably be expected to have known of franchisee non-compliance.

Practically speaking, this change means a franchisor has increased responsibility to demonstrate they have taken ‘reasonable steps’ to prevent a breach by their franchisees.

With the entire franchise sector under the spotlight, the FW Ombudsman won’t overlook the legal obligations of a franchisee. The increased penalties magnify the impact on franchisees and validate that all employers across all industries and sectors are liable for their workplace practices.

Contact Renee Henville at Integrated Human Resourcing for more information.