Reminder of new franchisor liability provisions


Franchisors should prepare for increased protections for vulnerable workers and doubling of maximum penalties for record-keeping breaches

Under recent amendments to workplace laws, some franchisors can be held responsible if a franchisee contravenes certain provisions of the Fair Work Act 2009.

These provisions include:

  • Entitlements under the National Employment Standards, awards and agreements;
  • National minimum wage orders, equal remuneration orders and guarantees of annual earnings;
  • Rules about methods and frequency of payment, including deductions from wages or paying money;
  • Pay slips and record-keeping; and
  • Sham contracting.

“Certain franchisors can now be held responsible when their franchisees don’t follow workplace laws (including underpaying employees) if they know, or should have known about it, and didn’t take reasonable steps to prevent it,” explains the Pharmacy Guild’s Workplace Relations team.

“Members who belong to a franchise arrangement should carefully consider the changes to ensure you understand and comply with your obligations,” they say, pointing owners to a fact sheet published by the Fair Work Ombudsman (FWO).

Maximum penalties for businesses that breach recordkeeping laws have also recently doubled.

In response, FWO has launched a new online learning course to assist small businesses in understanding and meeting their record-keeping and pay slips obligations, and also improve their workplace practices.

This course provides:

  • Guidance on when records must be created, updated and provided to employees;
  • Advice on what to include in pay slips;
  • Details about your legal obligations under the Fair Work Act;
  • Practical tips on setting up and maintaining a record-keeping system; and
  • Links to downloadable resources and further information.

“Members are encouraged to complete the new course to ensure you are complying with your record keeping obligations,” says the Guild.

“Every Australian employers is obligated to keep accurate employment records,” says FWO Natalie James.

“We see far too many businesses failing to get the basics right when it comes to record keeping and regrettably it’s often workers who get hit the hardest as a lack of accurate records can make it difficult to determine if they have received their correct entitlements.

“With the release of our new materials, there has never been so much freely available information to assist employers to understand their workplace obligations. The time for excuses is over,” says Ms James.

Other resources from the FWO include:

  • My account which provides tailored information and lets you make enquiries online for priority support. 
  • Pay and Conditions Tool (PACT) which helps you work out what you need to pay your employees. 
  • Online Learning Centre which has free, interactive short courses to teach you new skills and strategies. 
  • Record My Hours app which helps small business owners who do not have the resources to install expensive automated time-recording systems help their employees record and store the hours they work, plus other information about their employment. 
  • The Fair Work Handbook (DOCX 390.1KB)   (PDF 1.1MB) which outlines your responsibilities under the Fair Work Act, the National Employment Standards, awards and agreements. 

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