Following on from our recent article titled ‘Vulnerable Workers Bill Passed by Senate’, this week the Australian House of Representatives voted in favour of the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 (‘Bill’) after a number of amendments were made by the Labor Party and cross-bench Senators in the Senate. The Bill will now become law once it receives Royal Assent.
The Fair Work Ombudsman has provided the following summation of the Bill:
When the Bill receives Royal Assent, the following changes to the Fair Work Act 2009 (Cth) (the Fair Work Act) will apply straight away:
- Increased penalties for ‘serious contraventions’ of workplace laws;
- Making it clear that employers cannot ask for ‘cashback’ from employees or prospective employees;
- Increased penalties for breaches of record-keeping and pay slip obligations;
- Employers who don’t meet record keeping or pay slip obligations and cannot show a reasonable excuse, will need to disprove wage claims made in a court (this is also referred to as a reverse onus of proof);
- Stronger powers for the Fair Work Ombudsman to collect evidence in investigations; and
- New penalties for giving the Fair Work Ombudsman false or misleading information, or hindering or obstructing their investigations.
The following changes will also apply 6 weeks after Royal Assent:
- Certain franchisors and holding companies could be held responsible if their franchisees or subsidiaries don’t follow workplace laws (if they knew, or should have known, and could have prevented it).
Given the extensive fines that could be imposed pursuant to the proposed legislation, all franchisors ought to take proactive steps as soon as possible to address any non-compliance within their franchise networks. In particular, franchisors should ensure that appropriate due diligence systems are in place that will enable them to monitor the compliance of their franchisees and to take appropriate action when an underpayment, or an allegation of underpayment, has been identified.
Marino Law can review your franchise documentation and franchisee compliance systems and provide you with advice as to whether your franchised operations will be captured by the Bill and if so, what steps you need to take to amend your documentation and compliance processes moving forward to avoid incurring significant liability.
Marino Law has extensive experience acting for franchisees and franchisors with respect to the negotiation and preparation of franchise agreements and associated documentation. Marino Law also has extensive experience in dealing with disputes between franchisors and franchisees.
Should you require assistance in any of the above areas, please contact one of our highly experienced lawyers.