Summary

The “accessorial liability” provisions in the Fair Work Act 2009 (Cth) (Fair Work Act) are broad and the scope for being found liable for a breach is much wider than you may realise. This can potentially result in HR personnel, managers and others having civil penalty orders made against them.

In this article we discuss accessorial liability for HR professionals and others under the Fair Work Act, how to prevent liability and what action you can take if you suspect that a breach has occurred at your workplace.

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When can I be held liable?

There may be circumstances where you are deemed to be “involved” in a breach of the Fair Work Act. Where this happens, you will be taken to have personally engaged in a contravention, which means that you can potentially be fined. This is in addition to any fines imposed on the employer.

For you to be “involved” in a contravention of the Fair Work Act, you must have had knowledge of the essential facts constituting the contravention; you must have been knowingly concerned in it; and you must have been an intentional participant in the contravention based on your actual knowledge.

A key point to remember is that you don’t even have to know that the actions in question constituted a contravention for you to be legally considered “involved” in that contravention.

You are more likely to be “involved” in a contravention if you are involved in the day-to-day operations of the employer and have a higher degree of control. However, you need not hold any special or senior position - anyone can be liable.

What can I be held liable for?

Accessorial liability issues for individuals often arise in relation to sham contracting, underpayment, adverse action and discrimination, and breaches of the National Employment Standards (NES).

Even relatively minor actions can result in a person being held accessorily liable for breaches of the Fair Work Act. For example, a failure to give written notice of dismissal before dismissing a person from their employment would contravene the Fair Work Act. The employer and any person involved in the contravention could then face proceedings.

Recently, an employer failed to provide correct notice or payment in lieu of notice of termination under the NES.1 By providing one month’s notice, instead of the five weeks as required, the employer breached the Fair Work Act. The court in that case found the Employee Development Manager accessorily liable due to her involvement. She was aware of the changes to the employee’s role, and also wrote and delivered the letter advising the employee of the termination of his role. However, the Employee Development Manager in this case cannot be said to have been all that senior or to have had an exceptional degree of influence over the events that unfolded.

How can I prevent liability?

Proactively taking steps to minimise your risk is a sensible strategy - after all if there is an issue, it is better for it to be discovered by your organisation, rather than being brought to light by a whistleblower, a union or the regulator where the financial and public relations consequences can be far reaching.

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What can I do if something is wrong?

If you suspect a breach of the Fair Work Act has occurred at your workplace, you should consider the following courses of action:

  • prepare a report noting the potential breach and recommending a remedy;
  • communicate the report to your manager, supervisor or director;
  • if your concern is ignored and you are directed to carry out the action, you should, if possible, refuse to implement the improper conduct and explain the reasons in writing; and
  • think about whether legal professional privilege is a relevant consideration before taking some of the above steps.