10th Nov 2020, 12:48 PM – Senate Economic Recovery Package (Jobmaker Hiring Credit) Amendment Bill 2020 - in Committee - Underpayment

The majority voted against amendments (1) and (2) introduced by NSW Senator Mehreen Faruqi (Greens), which means it failed.

What do the amendments do?

Senator Faruqi explained that:

Over the years there have been plenty of examples of businesses that have denied workers their full pay and their full rights. Many big businesses eligible for the JobMaker hiring credit actually have a history of underpaying their staff and their workers, but this scheme, as it stands at the moment, allows public funds to subsidise those same businesses that have been underpaying their staff. Surely no-one in this place can agree that that should be allowed to happen. Our amendments remove eligibility for businesses that are found to be underpaying their workers while receiving the JobMaker hiring credit. Businesses will be required to repay the total sum of the credit they have received. Our amendments also include protections to prevent employers seeking payments from their workers to cover that repayment.

Amendment text

(1) Schedule 1, page 3 (after line 11) , after item 2, insert:

2A Section 6

Insert:

underpaying in relation to an employee: see subsection 7A(4).

underpayment event: see subsection 7A(3).

(2) Schedule 1, page 3 (after line 26), after item 4, insert:

4A After section 7

Insert:

7A Requirements for rules that provide for jobmaker hiring credit scheme — ineligibility for underpaying employees

(1) This section applies if rules are made for the purposes of subsection 7(1A) that provide for a kind of payment known as the jobmaker hiring credit.

Ineligibility for underpaying employees

(2) The rules must provide that an entity is not eligible for the payment if, during the relevant period, an underpayment event occurs in relation to:

(a) the entity; or

(b) an associated entity (within the meaning of the Corporations Act 2001) of the entity.

(3) There is an underpayment event in relation to an entity if any of the following apply in relation to the entity:

(a) a court or the Fair Work Commission makes an order requiring the entity to make payments to one or more of the entity's employees in connection with underpaying the employees;

(b) the Fair Work Ombudsman accepts an enforceable undertaking from the entity under section 715 of the Fair Work Act 2009 in relation to a contravention involving underpaying employees;

(c) the entity is given a compliance notice under section 716 of the Fair Work Act 2009 in relation to a contravention involving underpaying employees;

(d) the Commissioner reasonably believes that the entity is, or has been, underpaying employees.

(4) For the purposes of this section, underpaying an employee means failing to pay the employee the amount or amounts the employee is entitled to be paid as such an employee (whether as salary, wages or other allowances or entitlements, and whether under a relevant award, agreement or other instrument or any other law).

Prohibition on demanding payments from employees if employer is ineligible

(5) The rules must also provide that, if:

(a) an entity is determined to not be eligible for the payment under rules made for the purposes of subsection (2) because of an underpayment event; and

(b) as a result the entity is liable to repay amounts to the Commonwealth;

the entity, or an associated entity (within the meaning of the Corporations Act 2001) of the entity, are prohibited from both of the following:

(c) requesting or demanding payment of an amount from an employee to cover some or all of the repayments for which the entity is liable;

(d) withholding from amounts the entity or associated entity is liable to pay an employee an amount to cover some or all of the repayments for which the entity is liable.

(6) An entity commits an offence of strict liability if:

(a) the entity is subject to a prohibition under rules made for the purposes of subsection (5); and

(b) the entity fails to comply with the prohibition.

Penalty: 60 penalty units.