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When are managers liable for their employer’s Fair Work Act breaches?

The accessorial liability provisions of the Fair Work Act 2009 (Cth) (FW Act) operate to make a person who is involved in an employer’s contravention of a civil remedy provision of the FW Act liable for the same contravention.

This can arise where a person is in any way, by act or omission, directly or indirectly, knowingly concerned in the contravention.

In Fair Work Ombudsman v DTF World Square Pty Ltd (in liq) (2023), the Fair Work Ombudsman sought orders rendering the general manager and human resources manager accessorily liable for their corporate employer’s contraventions of the FW Act and the modern award covering its hospitality employees.

In granting those orders, the Court observed that a person can be knowingly concerned in their employer’s underpayment of other employees in breach of an award, even if they were unaware of:

  • the name of the award;
  • the clauses of the award that breached;
  • the FW Act sections that the company had contravened when they breached the award; and
  • the precise circumstances in which the underpayment arose, e.g. the hours they worked.

To be an accessory, however, they do need to appreciate that the employees worked in circumstances that gave rise to an entitlement under an award, and their employer did not give them that entitlement.

Aside from that knowledge, the alleged accessory must have engaged in conduct that implicates or involves them in the contravention. It’s not necessary they physically did anything to bring about the contravention. It is sufficient they are in some way associated with the conduct constituting the contravention.

The Court rejected the argument that the managers were simply obeying orders and directions issued by the company director in facilitating the employee underpayments. Neither of them was a “mere onlooker” or “a cog in the wheel”. To the extent that they were complicit in the continuing operation of the payroll system, they assisted in bringing about the contraventions and/or were knowingly concerned in or party to those contraventions.

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