It is not only the employer or principal who needs to be concerned about breaches of the civil liability provisions of the Fair Work Act 2009 (Cth) (FW Act). Directors, managers and human resources professionals can also be found personally liable as accessories if they have been involved in a breach of civil remedy provisions.
Section 550(1) of the FW Act lays down the law, stating that anyone involved in a contravention of a civil remedy provision is taken to have contravened that provision. Section 550(2) further elaborates on this, explaining that a person becomes involved in a contravention of a civil remedy provision if they:
- Aided, abetted, counselled, or procured the contravention (section 550(2)(a)).
- Induced the contravention, whether through threats, promises, or other means (section 550(2)(b)).
- Were in some way, directly or indirectly, knowingly involved in or a party to the contravention through their actions or lack thereof (section 550(2)(c)).
- Conspired with others to bring about the contravention (section 550(2)(d)).
The crux of section 550 is that it holds those “involved” in contravening a civil remedy provision accountable as accessories. To be deemed “involved” in and knowingly concerned with a statutory contravention, a person, whether an individual or corporation, must have:
- engaged in conduct which implicates or involves that person in the contravention such that there is a “practical connection” between that person and the contravention; and
- intent. In this regard it must be established that the person was an intentional participant with actual knowledge of the essential elements constituting the contravention.
Even if the contravention was beyond their control, and they took “reasonable” steps to mitigate its effects, an accessory may still be considered “involved.” For instance, in the case of Fair Work Ombudsman v Priority Matters Pty Ltd [2017] FCA 833, directors who used their personal funds to ensure employees received their entitlements when the corporate employer failed to do so, were still deemed “involved” in the corporate contraventions. This was because the directors were aware of the non-payment of entitlements and had continuous control over the corporate employer.
The maximum penalties imposed by a court for contravening or intending to contravene a civil remedy provision vary depending on the specific provision and whether the offender is an individual or a corporation. For individuals, the penalty can range from 30 to 60 penalty units, while for corporations, it can be 150 to 300 penalty units (Sections 539(2) and 546(2)).
As of the time of writing (September 2023), if you’re an individual found to have contravened a civil remedy provision, you could be facing a maximum penalty of $18,780 for each contravention, while a corporation might be liable for up to $93,900 per contravention.
In cases of “serious contraventions” of certain civil remedy provisions, these maximum penalties can skyrocket to ten times their normal amount.
For additional information regarding section 550 of the FW Act and its implications or for specific legal advice, please feel free to reach out to us.
