On Monday, 3 April 2017, ACAPMA CEO Mark McKenzie attended an important forum to discuss the issue of wage underpayment in Australian workplaces.

This forum was convened by the Council of Small Business Organisations of Australia (COSBOA) and ACAPMA attended the forum together with other peak bodies such as the Pharmacy Guild of Australia and Australian Lottery and Newsagents Federation.

Attendees at the forum included representatives from the Australian Government, the Federal Opposition, Allan Fels (Chair of the Migrant Worker Taskforce), Bruce Billson (President of the Franchise Council of Australia), Kate Carnell (The Australian Small Business and Family Enterprise Ombudsman), senior representatives from the Australian Fair Work Commission (FWC) and senior representatives from the Australian Fair Work Ombudsman (FWO).

As discussed in previous articles (refer https://acapmag.com.au/home/2016/10/federal-government-gets-tough-employment-laws/ and https://acapmag.com.au/home/2016/11/know-law-else/), the Australian Government established two multi-agency taskforces during 2016 to improve its capacity to detect wage underpayment and investigate issues associated with the exploitation of migrant workers in Australian workplaces.

But the issue of wage underpayment hasn’t gone away.

The Australian Government is currently considering new laws that will potentially have a marked impact on the future operation of franchisor and franchisee relationships in many industries – including the petrol-convenience industry.

Key amongst these changes is a new piece of legislation that was introduced into the Australian Parliament on 1 March 2017 – the Protecting Vulnerable Workers Bill (2017).

In a move that threatens the very integrity of franchise operation in Australia, this new Bill proposes to make franchisors liable for breaches of employment law by their franchisees (see http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r5826).

In effect, these proposed laws let franchisees ‘off the hook’ when it comes to wage compliance in the future.

“These laws break new ground and, if introduced in their current form, will potentially have far reaching negative impacts on the future operation of franchise agreements in several industries – including our own”, said ACAPMA CEO Mark McKenzie.

Over the past 12 months, ACAPMA has been working with COSBOA and other peak bodies to ward of such black-letter legislation by proposing alternative and non-regulatory responses that do not create unintended negative consequences for market participants.

“The new laws to be effected under the proposed Vulnerable Workers Bill (2017) will likely have a negative impact on a very large portion of our industry – even though the clear majority of businesses in our industry are doing the right thing”, said Mark.

“We believe that it would be more prudent for the Australian Government to increase the enforcement resources of existing regulatory agencies – such as the Fair Work Ombudsman – and provide affected industries with the time to demonstrate that they can get their ‘own houses in order’, before considering such drastic laws”, said Mark.

ACAPMA has already sought to demonstrate how the industry can resolve the issue without the need for legislation, by providing a new service to its members.

“This new service – the Compliance Partner Programme – is an extension of our employment and IR assistance and provides businesses with the opportunity to get a ‘health check’ of their current wage practices”, said Mark.

“Our intent is to provide business owners with peace of mind with respect to compliance with award pay rates and conditions – much of which is complicated and daunting to most business owners”, Mark continued.

The results of the ‘health check’ remain wholly confidential between ACAPMA and the member business.

“Where problems are observed, ACAPMA provides guidance on how these problems might be quickly addressed within existing commercial constraints”, said Mark.

“Anyone in the petrol-convenience industry that believes the issue of wage underpayment has simply ‘gone away’ is kidding themselves”, Mark continued.

“Unless we can demonstrate that we collectively have the capacity to address these issues voluntarily, our industry is likely to face new laws that will potentially have substantial negative impacts on the future commercial arrangements used by many of the dealer businesses that comprise our industry”, said Mark.

ACAPMA is working proactively with COSBOA and other peak industry bodies to demonstrate leadership on this issue and urge the government to work cooperatively with affected industries to resolve the current wage underpayment issues, without the need for introducing new black-letter legislation.

“We are keen to ensure that the government does not introduce new laws to address wage underpayment issues that effectively undermine the integrity of franchise and agency agreements in the future”, said Mark.

The new draft laws have been referred to a Senate Committee for Review and report back to the Australian Parliament by 9 May 2017.

In the meantime, ACAPMA will continue to lobby the Australian government to pursue non-legislative alternatives by working cooperatively with affected industries and their peak bodies.

More information about ACAPMA’s Compliance Partner Programme can be obtained by emailing the ACAPMA Secretariat at communications@acapma.com.au or calling 1300 160 270.