Ignore Compliance Notices at your own risk

Solid compliance foundations are vital for every business to ensure smooth operations and protect both employees and employers. When compliance is neglected, gaps emerge, resulting in persistent issues that can erode workplace trust and productivity. Fixing these issues, however, is no simple task.

Australia’s employment laws are among the most intricate in the world, designed to provide robust protections for workers while setting clear obligations for businesses. With multiple mechanisms in place to detect breaches, addressing non-compliance in the workplace requires swift, informed action. This is where regulators like the Fair Work Ombudsman (FWO) step in. The FWO plays a critical role in monitoring workplace practices, holding businesses accountable, and providing support to both employees and employers. Their actions, whether in offering guidance or initiating legal proceedings, ensure that workplace laws are enforced fairly and effectively, fostering a culture of compliance across industries.

Here, our experts explain what a Compliance Notice is, its function, and share real-life examples of how they’re used to combat breaches of workplace law.

So, what is a Compliance Notice?

When an employer fails to cooperate with a Fair Work Inspector to resolve a breach, the inspector may issue a compliance notice as an alternative to legal action. This notice outlines:

• specific workplace law/s that have been breached;
• what steps the employer must take to address the issue (such as calculating and paying any underpayment to affected employees and/or providing proof of resolution);
• the deadline for completing these actions;
• how the employer can request a court review of the notice; and
• potential consequences of non-compliance.

What happens when you ignore a Compliance Notice?

If an employer fails to comply with a compliance notice and the matter goes to court, the court can order the employer to comply fully or partially with the notice and impose fines. The FWO can’t start legal proceedings for breaches outlined in the notice if the employer complies and rectifies the breaches.

‘The FWO has commenced legal action against…’ is never a sentence you want your business to appear in, but for these two Sydney-based businesses, it’s currently a reality. After failing to rectify the employment law breaches outlined in a Compliance Notice, the FWO has commenced legal action against these companies and their directors.

1. Up to $25k in potential fines for a former cleaning business operator

The FWO has initiated legal action against Veens Group Pty Ltd, a housing construction company based in Harrington Park, New South Wales, and its sole director, Dasi Shi. The case stems from allegations that the business failed to compensate a young migrant worker, a Chinese national on a student visa, for eight days of casual work in October 2022.

Despite being issued a Compliance Notice in June 2023, requiring the back payment of entitlements as per the Building and Construction General On-Site Award 2020, the company allegedly failed to act without a reasonable excuse.

Potential fines and alleged breaches include:

• Non-compliance with a Compliance Notice, a breach of workplace law.
• A potential penalty of up to $46,950 for Veens Group Pty Ltd.
• A maximum penalty of $9,390 for the director, Dasi Shi.
• The obligation to back-pay the worker’s entitlements, along with interest, if ordered by the court.

2. Former cleaning business allegedly underpaid a migrant worker and faces court

Legal action against Nereshnie Pather, the former operator of a cleaning business in Sydney, has commenced for alleged breaches of employment laws affecting migrant workers. The investigation began following complaints from three casual employees, all on working holiday visas, about unpaid minimum wages during May and June 2023.

FWO alleges that Ms Pather failed to comply with a Compliance Notice issued in October 2023, requiring her to back-pay these workers under the Cleaning Services Award 2020. Additionally, she is accused of violating pay slip laws by failing to provide mandatory pay documentation to one worker.

Potential fines and alleged breaches include:

• Non-compliance with a Compliance Notice, a breach under workplace law.
• A potential penalty of $9,390 for failing to comply with the Compliance Notice.
• A pay slip contravention that carries a maximum penalty of $16,500.
• The obligation to calculate and reimburse outstanding wages, plus any accrued interest and superannuation, if ordered by the court.

How Citation HR can help

It is key that all businesses reflect upon the figures of the 2023-2024 wage recovery and ensure that they’re meeting the compliance standards in their workplaces. A comprehensive HR compliance audit from Citation can help identify potential risks and provide tailored solutions to keep your business fully compliant.

If any of the information we’ve shared in this article has raised any questions, or you have another workplace matter you need support with, please reach out to the team at Citation HR via our 24/7 HR Advice Line.

Not a Citation HR client? Why not test out our advice? Arrange a complimentary workplace compliance consultation with our friendly team today.