Friday, 15 September 2017
The Fair Work Amendment (Protecting Vulnerable Workers) Act 2017 means there are harsher penalties for serious breaches of employment entitlements and record keeping failures, starting last Friday (15 September). If an employer fails to keep records and an employee claims they have been underpaid, the employer must also prove they did in fact meet their obligations and paid the employee correctly.
What are the changes?
The following changes apply from today:
- increased penalties for serious violations of the Fair Work Act; where an employer is knowingly breaching their obligations and is doing so systematically
- prohibits employers requiring ‘cashback’ from current or prospective employees (ie unreasonably making an employee spend or pay money for the benefit of the employer)
- increased penalties for employers that breach their record-keeping and pay slip obligations such as failing to keep accurate records or providing false or misleading information to their employees
- stronger powers for the Fair Work Ombudsman (FWO) to investigate breaches of the Fair Work Act
Who do the changes impact?
The changes apply to all employers and employees covered by the Fair Work Act, but are particularly important for franchisors and holding companies.
Franchisor and holding company liability.
Franchisors and holding companies will be responsible if their franchisees and subsidiaries do not follow workplace laws about minimum entitlements, including the National Employment Standards, Awards, sham contracting, record-keeping and pay slips. These changes do not come into force until 27 October 2017.
What do I need to do?
The changes have not significantly affected the obligations of employers, but the increased penalties and regulatory powers means that it is more important than ever to ensure correct pay and record-keeping practices.
It is vital that employers keep accurate records for at least seven years (including details of the employee’s name, commencement date, employment status, pay, hours worked, leave, superannuation contributions) and pay slips must be provided to employees within one working day of payment.