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Vulnerable Workers Bill comes into effect

Reading digital articles, I almost never read the paper!

The Protecting Vulnerable Workers Bill comes into effect Tomorrow; Friday October 27, 2017. I spent significant time over the first-half of this year discussing the bill with federal MPs and Senators, as well as educating state MPs, and government officials, on the impacts of this bill.

The bill give the Fair Work Ombudsman significantly increased powers to investigate wage fraud, and introduces higher penalties for failing to keep wage records, falsifying records, or cashback fraud (wage repayment scams).

The bill has a host of impacts, but some key highlights are:

  • franchisors and holding companies will be liable for underpayments if they knew or ought to have known about those underpayments, but failed to take reasonable steps to address them

  • an increase to existing penalties under the Fair Work Act, up to x10

  • that underpaid workers (who are employed by a franchisee) can now seek restitution from the franchisor

  • the bill specifically prohibits cashback scams where workers are paid in full and then forced to repay some or all of their wages in cash, giving the impression of correct payment

  • greater investigation and enforcement powers to FWO

  • employers will have to disprove underpayment claims made against them by employees, rather than employees having to prove underpayment - a reversal of the onus of proof

The bill also adopts a definition of a franchise which is found in the corporations act, and is different the definition in the Franchising Code of Conduct. That definition is likely to also apply to business models, such as licences, which do not typically consider themselves franchises.

The Fair Work Ombudsman (FWO) has released online resources to help the franchise community understand their obligations under the new laws, and these links will take you there:


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