News from the FCA: August 2017

Welcome to your monthly round-up of news and events from the Franchise Council of Australia.

Update on the Vulnerable Workers Bill

As you will no doubt be aware there has been substantial media attention on the passage of the Fair Work Act (Protecting Vulnerable Workers) Bill 2017, which has been introduced into the Senate for debate.

Reasonable amendments to the proposed legislation, which are supported by the FCA, were earlier this year proposed by the majority Senate Committee Inquiry report.

As part of our engagement, the FCA has participated in roundtable discussions with Government and our members, understands the Government is considering "reasonable amendments" to the Bill. 

The FCA have argued that the recommendations of the Senate Inquiry majority report would be considered to be reasonable amendments which if adopted would more closely link the new franchisor liability for Fair Work Act pay-related non-compliance of the franchisee-employers to where there is franchisor 'control or significant influence' over these franchise workplace matters, to provide greater clarity on what 'reasonable steps' means for different sizes of franchise systems and to generally ensure the legislation reflects the intent stated in the introductory speech and explanatory memorandum.

However, an extensive number of amendments have also been proposed by the Federal Opposition. Among Labor's amendments are those that seek to:

  • extend the reach of the legislation into supply chains (or "supply framework" as it is described);
  • make any kind of 'control or influence' (and not the 'control or significant influence' in the current Bill) over 'the worker's affairs or the affairs of the worker's employer' (rather than 'franchise affairs' in the Bill before the Senate) to trigger potential liability for a franchisor or 'Indirectly responsible entity' (as described in the Labor amendments); and
  • create a burden of proof on the employer/franchisor/'indirectly responsible entity' to disprove an allegation if records are not available/provided; and

Non-Labor aligned 'cross-benchers' have given notice of amendments that address two key recommendations from the Senate report that the FCA has been pursuing. These are:

  • the 'control test' and a need to have franchisor 'control or significant influence' over  workplace arrangements of franchisees to create potential for franchisor liability for wage underpayment or Fair Work Act civil remedy provision non-compliance.  The cross bench amendment seeks to expressly tie the question of 'control or significant influence' to the specific wage underpayment and workplace matters addressed by the civil remedy provisions; and
  • contain the 'known or reasonably should have known' trigger for the burden on franchisors to take 'reasonable steps' to address franchisee workplace non-compliance to a 'knowledge test' relevant to the 'ordinary course of business'.

The FCA continues to engage on behalf of members with the view to ensuring the franchise sector is not unfairly targeted in the final legislation.

It is expected debate on the Bill will resume when the Federal Parliament sits again from 4-14 September.

We will keep you updated as the debate continues.

Regards

Damian Paull
Chief Executive
Franchise Council of Australia

Casual Mall Licensing Code - Feedback sought from Retail Businesses

The Shopping Centre Council of Australia (SCCA) recently applied to the Australian Competition and Consumer Commission (ACCC) to re-authorise its Casual Mall Licensing Code of Practice (the Code) for a five-year period to 31 December 2022.

The Franchise Council of Australia (FCA), together with the Australian Retailers Association (ARA) and the Pharmacy Guild of Australia (PGA) do not support the re-authorisation of the Code, unless substantial changes are made to it prior to any proposed re-implementation. 

It is clear that the Code is not working as intended and a range of issues raised by permanent retailers are not being addressed.  Unilateral decision making by shopping centre landlords has led to the ongoing proliferation of Casual Mall Licenses granted in contravention to the Code.  This directly impacts on permanent lessees of retail shops across the country, and is a source of increasing dissatisfaction to existing retailers.

Together, we will make a submission to the ACCC on this matter by Friday 8 September 2017.  In an effort to present a strong case, we are seeking clear evidence from our members of breaches to the Code. 

The FCA, ARA and PGA have together created a survey to better understand the issues facing retail businesses in relation to Casual Mall Leasing.  We encourage all members to participate.  You can access and complete the survey here

Please note that contact details of respondents to the survey, or of member organisations who supply evidence, will remain confidential.  Any information received by the ARA, FCA or PGA will only be collated and provided to the ACCC noting a submission code.  Additionally, this information will not be passed on to any third-party organisations or individuals.

Building a Smarter Future at NFC17

The National Franchise Convention 2017, to be held on the Gold Coast from 8-10 October, this year poses the question: what is standing between you and a smarter future for your franchise?

It might be as simple as a new conversation that makes you think differently, or a connection that can assist to grow your business. It could be that nugget of information or spark of an idea from one of our speakers that leads you to explore a new way of thinking or approaching the challenges you have in your business.

In 2017, NFC features keynote speakers including Corporate Culture Expert, Steve Simpson, CEO of the USA's United Franchise Group, Ray Titus, and Federal Minister for Small Business, Hon Michael McCormack MP, and Natalie Brennan, General Manager of Muffin Break.

NFC17 will also will address the impact of the Fair Work Act (Protecting Vulnerable Workers) amendments on the sector, both in the Sunday Legal Symposium and in a Fair Work Keynote Panel, featuring prominent franchisors and Fair Work Ombudsman, Natalie James, in the main conference program.

Visit www.nationalfranchiseconvention.org.au to find out more and to complete your registration.

FCA joins Canberra small business hub

The Franchise Council of Australia is pleased to be part of an alliance of small business organisations that has been established by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO).

Established by the Australian Small Business and Family Enterprise Ombudsman (ASBFEO), the alliance will provide an opportunity for participating bodies to form a united approach on matters where there is a mutual interest and broad agreement.

This may include issues such as workplace relations, human capital (skills shortages, skills training and immigration), energy costs and supply, access to justice, NBN and cyber security

The ASBFEO is also establishing a small business hub in Canberra, where representative organisations, including the FCA, can access office accommodation and facilities to undertake business in Canberra.

www.franchise.org.au

FCA Partners