One of the roles of the Fair Work Ombudsman (FWO) is to investigate workplace matters, particularly with a view to protecting the most vulnerable workers.
The FWO has statutory powers to carry out investigations and make findings. It does so either on its own initiative (such as carrying out random audits of businesses) or because an employee has made a complaint to it.
Fair Work Ombudsman investigations
FWO investigations often involve an assessment of whether employees are being paid correctly and provided with the correct employment entitlements (eg leave, breaks, etc) and whether employers have kept proper employee records.
Ideally, employers should be aware of their obligations to employees before any investigation by the FWO occurs.
In Australia, the majority of employees are covered by an industry or occupation specific modern award which sets out minimum terms and conditions of employment (including minimum wages based on their duties, qualifications, age and experience). Determining which award applies to your staff can be a daunting task and EI Legal frequently advises clients on award coverage and their obligations to employees under the award.
If employers fully understand their obligations to employees and organise their affairs appropriately, they should have nothing to fear from an FWO investigation.
For employers who face an FWO investigation who are less clear about their obligations, it is often advisable to seek legal advice to understand the investigation process, the possible risks for the business (and for individuals running the business personally) and to make sure you have advice about your obligations going forward.
What will happen in an FWO investigation?
An FWO investigation will often involve an (unannounced) visit to your workplace where you and your staff will be interviewed. Businesses will often be required to provide employment records (time-sheets, payslips, banking records, etc) so that the FWO can assess whether employees have been paid correctly.
If the FWO determines – after their investigation – that the employer has breached the minimum requirements set out in the Fair Work Act 2009 (Cth) or a modern award, they have the power to apply to the court for a financial penalty against the business (as well as an order that any underpayments against employees are made good). It is usual for the FWO to also make applications to the court against officers of the business (eg directors, HR managers, etc) to be held personally liable for contraventions.
If you find yourself subject to such litigation it is advisable to seek legal advice. Given the significant financial penalties individuals can face, it is often beneficial to be represented by an employment lawyer if you are defending any proceedings. A lawyer will also be able to argue why – if you are held to have been involved in a contravention of the law – any penalty awarded should be at the lower end of the scale.
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