Fair Work Ombudsman gets more powers

28 September 2017

Australia’s Fair Work Ombudsman (FWO) regularly prosecutes employers who breach Australian employment laws. Key advisors, such as HR managers, accountants, bookkeepers and payroll personnel, are also regularly prosecuted for accessorial liability when their client/employer breaches the law. As in New Zealand, even stronger laws are on the way with the passage of the Vulnerable Workers Bill.

Increased Powers

The FWO will be able to issue a notice to individuals and companies requiring information or documents as well as requiring an individual to participate in an interview under oath or affirmation. There is also a prohibition for deliberately providing false and or misleading information.

Increased Penalties

Penalties have also increased. For a serious contravention, which is conduct that is deliberate or intentional and which forms part of a systematic pattern of conduct, the maximum penalty is $126,000 for individual and $630,000 for an incorporation.

Franchisors liable for actions of Franchisees

A franchisor is liable if a franchisee contravenes the Act and the franchisor exerts a 'significant degree of influence or control' over the affairs of the franchisee and either 'knew or could reasonably be expected to have known' that the relevant contravention was, or was likely to be, committed by the franchisee.

Recent Cases

40% of United Petroleum Stores Underpaid Workers. The FWO has blasted petrol giant United Petroleum for wide-spread underpayment of workers across its franchise network.
MasterChef judge and celebrity chef George Calombaris found guilty of underpaying 162 of his restaurant employees a total of up to $2.6m after the FWO found payroll errors dating back 6 years.
Caltex terminated 19 franchise agreements for non-compliance, covering 43 sites, for underpayment of employee entitlements and other significant workplace non-compliance issues.
Three-quarters of Pizza Hut outlets were found to be non-compliant.
A company, its director and payroll manager have been penalised $143,000 for underpaying workers $18,000.