On 5 September 2017, the Commonwealth Parliament passed into law the Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017 (Bill). The purpose of the Bill, as the name suggests, is to protect vulnerable workers (such as low paid and workers on visas) from systemic non observance of those workers’ rights and entitlements under the Fair Work Act.
The key changes to the law by the Bill include:
- Increasing the current maximum penalty unity for individuals and corporations who knowingly contravene the law by a factor of 10;
- Tripling the maximum penalty for false or misleading records;
- Double the maximum penalty for not keeping accurate pay, leave etc records for employees; and
- Increased protections for employees and prospective employees regarding payments from employees to employers (sometimes called cashback arrangements).
Practically for employers, it means that now, more than ever, it is absolutely vital that employees are correctly paid, their annual leave properly credited and that meticulous records are kept of these (and other amounts).
For most businesses, a single underpayment in a single pay run has the potential to attract a penalty that may cause that business to become insolvent, and the directors of that business (if run through a company structure), to become personally liable for that omission.