Fair Work Investigations

In Australia, the Fair Work Ombudsman (FWO) investigates workplace matters, particularly claims of harassment and bullying, unfair dismissal, disputes over superannuation payments, and workplace health and safety issues. Often these Fair Work Investigations are run concurrently with an employer-instigated internal workplace investigation.

FWO Investigations

The FWO has statutory authority to send Fair Work Investigators (FWI) into workplaces either on its own initiative or following a complaint. The FWI looks into alleged breaches of workplace laws, especially the Fair Work Act 2009 and the Fair Work Regulations 2009. During a workplace investigation, the FWI collects and examines evidence before making decisions on:

• the applicability of Australian workplace laws, and relevant industrial awards or registered agreements;
• whether the employer has followed these laws based on the evidence and the extent and seriousness of the contraventions;
• the cooperation of the parties involved; and
• how to resolve the situation.

FWO Investigations often focus on whether employers keep proper employee records, whether employees are paid correctly, and provided with their correct employment entitlements such as breaks and leave. An FWO investigation typically involves an unannounced visit to the workplace where the employer and staff will be interviewed. Businesses are usually required to provide all relevant employment records, such as payslips, timesheets, and banking records, so that the FWO has a clear idea of the issues.

FWO Notices

The Fair Work Ombudsman can apply to the Administrative Appeals Tribunal for a FWO Notice if they reasonably suspect that a business or individual has information that will help their investigation. A FWO Notice is a document that can compel a business or person to hand over information, produce documents, or attend an interview. The information that the FWO seeks must relate to a suspected contravention such as underpayment of employees, “cash backs”, unfair dismissal, or unlawful discrimination.

If the Administrative Appeals Tribunal does approve a FWO Notice, the FWO must give the person or business at least 14 days to comply. In addition, the person who is subject to the FWO Notice is entitled to:

• legal representation and reimbursement for reasonable expenses if they are required to attend an interview;
• indemnity for any damage, loss, or injury to another person because they complied with the FWO Notice; and
• the information given cannot be used in a legal proceeding against the subject of the Notice (unless they give misleading or false information or obstruct a Commonwealth official).

Noncompliance with FWO Notice

There are significant penalties for failing to comply with a FWO Notice:

• $187,800 fine for an individual
• $939,000 fine for a smaller company with less than 15 workers
• $4,695,000 fine for a larger company with 15 or more workers

Smaller penalties also apply to individuals and companies that:

• fail to provide records or documents by the deadline on the Notice;
• knowingly or recklessly giving information, documents or records that are misleading or false; or
• intentionally obstruct or hinder officials in their investigation.

FWO Outcomes

The outcomes of an FWO investigation vary according to the nature of the allegation and the results of the investigation. Many investigations result in either no further action (because of insufficient evidence or business closure), or a warning letter to the employer requiring rectification. Where the investigation finds a more serious contravention, the FWO may issue an Enforceable Undertaking or Compliance Partnership that forces the employer to take actions to address areas of concern. Should the FWI determine that the employer breached the minimum requirements set out in the Fair Work Act or modern award, the FWO can ask the court to impose a financial penalty against the business and force them to rectify their breach.

Litigation is the least common and most serious outcome of a FWI Investigation, indicating that the employer has seriously breached its obligations. The FWO can also make applications against the company officers (such as directors and HR managers) holding them personally liable for contraventions.

Case study

The Fair Work Ombudsman recently received a complaint from a worker and launched an investigation into a Queensland transport business, RiverCity Bus Service. The casual worker alleged that his employer was running an unlawful cashback arrangement involving JobKeeper payments. Introduced in 2020, the JobKeeper scheme was intended to keep workers employed during the COVID-19 crisis.

From March until September 2020, the employer received fortnightly $1500 JobKeeper payments from the Commonwealth Government for the driver. The driver’s usual fortnightly wages were less than the JobKeeper payments, and the employer required the driver to remit the difference between his usual salary and the amount of the JobKeeper payment back to him. In total, the employer deprived the employee of $6270.40 in JobKeeper payments.

When Fair Work Inspectors investigated, the employer rectified the underpayments in full. The Fair Work Ombudsman stated that they would not tolerate employers making cash back arrangements (except where such arrangements are specifically allowed by law). The Fair Work Ombudsman referred the business owner to the Federal Circuit and Family Court for breaches of the Fair Work Act. He was fined $14,000, for what Justice Vasta described as a “callous and despicable breach of trust”.

At Go To Court Lawyers, our employment law specialists can provide comprehensive advice so that your company is less likely to be the subject of a Fair Work Investigation. If the FWO does initiate an investigation, our team can help you navigate the process. Please get in touch with our team on 1300 636 846.