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Employment relations reformation is here

Published February 02, 2016 (last updated June 26, 2020) -
employment relations

Times could be changing for employment relations as the Labor government proposes to crack down on unlawful employers. Coming into the next election employment relations could experience a major reformation. This could include much bigger penalties and even jail time for employers who are not meeting their obligations under the Fair Work Act.

In the wake of last year’s embarrassment involving 7-Eleven stores docking pay records to cover up underpayments, Myer’s sub-contracting their cleaners and paying them under the award wage rate and Pizza Hut delivery drivers being underpaid at $6 an hour, drastic new disciplines may apply to not only the employers but also the corporations behind them.

Exploitation of workers

A Labor industrial relations policy was revealed yesterday which promises to target “unscrupulous” employers. These employers are those who deliberately exploit their employees. If found guilty of failing to meet employment obligations fines will steeply increase from approximately $10,800 to $43,200 for employers, and $54,000 to $1,080,000 for corporations. If the Labor goverment is elected these dramatic increases are sure to change the way employers think when it comes to bending the rules and dealing with employment issues. Every employer in the country will need to ensure they are aware of their obligations in order to avoid these business breaking fines.

Intentional breach of employment obligations

There is also suggestions of introducing a new criminal offence for employers who “intentionally or recklessly seriously rip off workers”, with a two year jail sentence and accompanying financial penalties.

Underpayments of staff

If an employer is found to have underpaid their staff, the fine will amount to three times the total of underpayments or $216,000, whichever is higher.

New measures

To hinder the exploitation of overseas workers a “Temporary Overseas Worker Support Pack” will become mandatory and provided to all overseas or temporary workers. If found to have failed to provide this pack, employers will be fined $10,800 ($54,000 for a corporation).

The Fair Work Ombudsman will be given increased powers to pursue employers who are being colourful in how they arrange their assets and taxes in order to avoid paying worker entitlements such as superannuation.

The Fair Work Act may change in order to toughen sham contracting and a new test will be introduced called the “reasonable person” test. This test will change a current loophole in the classification of the term of employment. The test will clarify if the employee is indeed an employee or an independent contractor. This classification is protected by different employment legislation and can determine if employment obligations have indeed be breached.

If you would like to ensure that you are meeting your employment obligations under the Fair Work Act or if you are concerned with these changes that you are confused with how to properly manage your employment relations, contact Employsure. Employsure helps businesses by giving employers know how and peace of mind by installing the correct employment policies and procedures into your business so that you are covered. Call Employsure today on 1300 651 415 to find out more.

About Employsure

Employsure is Australia’s largest workplace relations specialists. We take the complexity out of workplace laws to help small business employers protect their business and their people.

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