Australia: The new Corrupting Benefits legislation – what does it mean for employers?

Last Updated: 21 August 2017
Article by Benjamin Marshall and Hannah Dunai

Most Read Contributor in Australia, August 2018

On 10 August 2017, the Fair Work Amendment (Corrupting Benefits) Bill was finally passed by both Houses of Federal Parliament and is expected to take effect soon. The bill was introduced by the Coalition Government in response to key recommendations from the Royal Commission into Trade Union Governance and Corruption and is designed to avoid deals between employers and unions that were contrary to the interests of union members. However, it has broader implications for all employers.

In addition to criminalising the receipt or solicitation of "corrupting benefits" by unions and their associates, the new amendments to the Fair Work Act contained in the bill will:

  • make it a criminal offence for an employer to dishonestly provide, offer to provide or promise to provide a "corrupting benefit" to unions and their associates
  • make it a criminal offence for an employer to provide, offer to provide or promise to provide "cash or in kind payments" to a union (or other prohibited beneficiaries) where the employer (or its associates) employ potential members of that union (subject to legitimate exceptions)
  • require the disclosure by employers of any benefits that may reasonably be expected to be derived by unions and their associates or the employer and its associates through enterprise bargaining.

Corrupting benefits

A benefit is a "corrupting benefit" if it is intended to influence a union officer or employee:

  • in the performance of their duties
  • in the exercise of their legal powers or functions, or
  • to give an advantage of any kind in connection with the affairs of the employer which is not legitimately due.

"Benefit" is defined broadly, and includes but is not limited to, property. Relevantly, the person to whom the benefit is provided does not need to be an officer or employee of a union, provided that the benefit is given or offered with the intention of influencing the officer or employee.

There is no requirement that the employer actually obtain a benefit from the corrupting benefit.

Offences in relation to corrupting benefits carry significant penalties of a maximum of 10 years imprisonment and/or fines of $1,050,000 for an individual or fines of $5,250,000 for a body corporate.

Provision of cash or in kind payments by employer of potential union members

Unlawful "cash or in kind payments" are defined broadly to include the provision of goods or services.

Exceptions include union membership fees, tax deductible gifts and market value payments for supply of goods or services, as well as certain commonly provided token benefits that do not exceed the current limit of $420.

Offences in relation to providing benefits in this way carry lesser penalties of a maximum of two years imprisonment and/or fines of $105,000 for an individual or fines of $525,000 for a body corporate.

Disclosure of benefits derived through enterprise bargaining

Where the terms of a proposed enterprise agreement can reasonably be expected to operate to provide a prescribed financial benefit to a union, the union must disclose in writing details of that benefit to the employer. The disclosure must occur by no later than the fourth day of the period in which employees who are voting on a proposed enterprise agreement are granted access to that agreement (EA Access Period). Employers will be exposed to civil penalties if they fail to disclose this document to employees as soon as practicable after it is disclosed to them and do not allow the employees to access it for the remainder of the EA Access Period after the disclosure to employees is made.

Employers also have a separate obligation to make a similar written disclosure to employees by the fourth day of the EA Access Period of any prescribed financial benefits the employer or its associates can reasonably be expected to receive from the operation of the terms of the proposed agreement. This disclosure does not extend to financial benefits received in the ordinary course of the employer's business.

The failure to make a required disclosure, or the making of a false or misleading representation in the employer's disclosure document, exposes the employer to civil penalties of up to $12,600 for an individual and $63,000 for a body corporate. However, any failures do not prevent the agreement from being approved or suggest it was not genuinely agreed.

Key considerations for employers

All employers involved in enterprise bargaining (whether with a union or not) must now turn their minds to the requirement to disclose prescribed financial benefits to employees who are voting on a proposed enterprise agreement. Required disclosures will need to be built into their agreement approval process. Advice should be sought about the terms of the agreement before it is circulated to employees to confirm that any disclosable financial benefits have been identified.

Employers in unionised industries should consider whether their existing arrangements with unions and their associates will breach the new laws, and seek advice if necessary. These employers will need to exercise extra caution in their dealings with unions and their associates to avoid any suggestion that they are involved in the provision or promise of any unlawful benefits.

The full scope of these laws remains to be tested in the courts.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Related Video
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions