Employers: increased penalties on records

The Fair Work (Protecting Vulnerable Workers) Act 2017 (Cth) introduced a slew of amendments to the Fair Work Act 2009 (Cth), and the recent changes affect every employer.

We will be doing a four-part series on these amendments due to their breadth and universal applicability.

The amendments target the following areas:

  • Employment Records (and what happens if you don’t keep accurate ones)
  • Liability for Franchisors for Franchisee breaches of the FWA
  • New investigatory powers for the Fair Work Ombudsman
  • Serious contraventions and Unreasonable Payments

This first eBrief describes the changes made to the obligation on employers to maintain employment records and the consequences for breaching this requirement.

Under ss535-536 of the FW Act employers are required to:

  • keep employee records for 7 years;
  • keep employee records in a legible form and a form that is readily accessible to a Fair Work Inspector;
  • provide a payslip to each of its employees within one day of paying an amount to an employee in relation to the performance of work; and
  • keep records and payslips

The amendments have greatly increased the civil penalties for breaching record keeping requirements in the FW Act:

  • The maximum penalty for failing to keep employee records and payslips has doubled from $31,500 to $63,000 for companies; and,
  • The maximum penalty for keeping false or misleading employee records or payslips, which the employer knows to be false and misleading has tripled from $21,000 to $63,000 for companies

An employer that deliberately, and part of a systematic pattern of conduct, fails to keep adequate or true records may also be liable for a ‘serious contravention’ of the FW Act. The maximum penalty for a serious contravention involving deliberate conduct will be $630,000 for a company and $126,000 for individuals involved in the breach (that includes HR Managers and directors).

These changes took effect on 15 September 2017, so it is important to resolve any issues with your record keeping as soon as possible.

If you have any questions about whether your company is complying with its records and payslip obligations, contact the Employment and Industrial Relations Team now.

For more information contact the Employment & Industrial Relations Team:

William Ward | Special Counsel
(02) 6279 4444