Christian Porter considers bid to help small businesses avoid pay pitfalls

Attorney-General Christian Porter. Picture: AAP
Attorney-General Christian Porter. Picture: AAP

Attorney-General Christian Porter will investigate expanding the role and funding of the Fair Work Ombudsman to provide targeted advice to small and medium-sized businesses about their payroll compliance obligations under the award system.

Mr Porter said the government was frustrated and disappointed by major companies underpaying employees, insisting big employers could not use the complexity of the award system as an excuse for not paying workers their legal ­entitlements.

But he told The Weekend Australian the government would exam­ine whether the FWO should have an expanded role to give more targeted advice on payroll compliance obligations.

The government will release a further workplace relations discussion paper this year that will canvass options for improving the operation of the award system.

“One of the questions that we will ask in the discussion paper is whether there is a role for the Fair Work Ombudsman to better interfa­ce with employers, but particularly small and medium-sized businesses, to assist them in navigating awards,” Mr Porter said.

“And that is necessarily something that would involve some level of funding but before we would commit to that, we ­obviously want to understand whether or not that would be a good-value spend.

“Could the Fair Work Ombuds­man play a really substantial­ role in assisting smaller and medium-sized enterprises who don’t have the benefit of the HR departments of Qantas, ­Wesfarmers or Maurice Blackburn for that matter? That is an area that I’m looking into, but that will be subject again to a proper process of consultation, of putting in a clear term the questions that we want people to answer and what the options might be.”

Employer representatives said advice currently provided to a small business when phoning the FWO could prove to be incorrect due to how the employer explained the ­nature of the business.

While the employer would not be fined if they acted on advice, they could face a substantial bill to backpay wages if they were paying workers under the wrong award.

One option likely to be examined by the government would be how the FWO could provide small and medium-sized businesses with more targeted practical inform­ation, including advice similar to rulings issued by the Australian Taxation Office.

Any extra funding to the FWO would be subject to the regulator having an expanded role.

The FWO has recovered $35m for more than 9000 workers this financial year and currently has 68 matters before the courts.

Peter Strong, the chief executive of the Council of Small Business of Australia, said Australia had one of the most complicated workplace systems in the world.

Mr Strong cited the example of the number of different penalty rates applicable in the service ­station sector.

Mr Porter said arguing that complexity existed in some awards would never be a justification for underpaying workers.

“I’m sure all governments whether they are Liberal or Labor think that it’s useful, where it’s possible and reasonable, to sim­plify­ awards so that they are easier to understand, easier to ­admin­ister,” he said. “But that is always a question of degree.

“The reason why we want to ask those questions through ­another discussion paper with consultation is we want to ­understand to what extent there can be simplification so that you get maximum economic uplift that benefits employers and ­employees.”