A Bill for an Act to amend the Corporations Law and the Workplace Relations Act 1996, in order to develop corporate responsibility and to protect the entitlements of employees
The Parliament of Australia enacts:
This Act may be cited as the Corporate Responsibility and Employment Security Act 2001.
2 Commencement and retrospective application
This Act is taken to have commenced on 12 September 2001 at 9.00 am by legal time in the Australian Capital Territory and applies in respect to companies that are in the course of being wound up or are wound up in the period between the commencement of this Act and the time when this Act received Royal Assent and to the period subsequent to Royal Assent.
3 Schedule
Each Act that is specified in a Schedule to this Act is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this Act has effect according to its terms.
1 After Division 6 of Part 5.7B
Insert:
Division 6A - Liability of a related body corporate for the debts or liabilities of a company
588YA Liability of a related body corporate for the debts or liabilities of a company
(1) When a company is being wound up in insolvency, the liquidator, a creditor of the company, a nominee of a creditor of the company or the ASIC may apply to the Court for an order that a company that is or has been a related body corporate pay to the liquidator the whole or part of the amount of a debt of the insolvent company. The Court may make such an order if it is satisfied that it is just to do so.
(2) In deciding whether it is just to make an order under subsection (1), the matters to which the Court shall have regard include:
(a) (a) whether the company provided services for or on behalf of the related body corporate; and
(b) whether the company occupied premises which are owned by the related body corporate; and
(c) the extent to which the related body corporate took part in the management of the company; and
(d) the conduct of the related body corporate towards the creditors of the company generally and to the creditor to which the debt or liability relates; and
(e) the extent to which the circumstances that gave rise to the winding up of the company are attributable to the actions of the related body corporate or an officer or officers of the related body corporate; and
(f) any other relevant matters as the Court considers just and appropriate.
(3) Where the Court is satisfied that the matters set out in 2(a) to (f) exist or that the circumstances that gave rise to the winding up of the company are substantially attributable to the actions of the related body corporate or an officer or officers of the related body corporate, the related body corporate shall bear the onus of establishing why an order under this section should not be made.
(4) An order under this section may be subject to conditions.
(5) An order shall not be made under this section if the only ground for making the order is that creditors of the company have relied on the fact that another company is or has been a related body corporate of the company.
2 Section 1317J
Insert after subsection 1317J(2):
(2A) A creditor of the corporation, or a nominee of a creditor of the corporation, may apply for a compensation order.
1 After section 170JH
Insert:
(1) Where:
(a) the Commission has determined that an employer that is a company should reinstate an employee pursuant to subsection 170CH(3); or
(b) the Court has determined that an employer that is a company should reinstate an employee pursuant to subsection 170CR(1) or section 298U;
the Commission or the Court respectively may, if it is satisfied that it is just, order that a related body corporate shall be deemed to be the employer for the purpose of the reinstatement order.
(2)In deciding whether it is just to make an order under subsection (1), the matters to which the Commission and the Court respectively shall have regard include:
(a) the extent to which reinstatement of the employee by the employer is impractical because the employer is in receivership or is in the course of being wound up; and
(b) the extent to which the related body corporate took part in the management of the employer; and
(c) the extent to which the circumstances that gave rise to the receivership or to the winding up of the employer are attributable to the actions of the related body corporate; and
(d) any other relevant matters.
(3) The Commission and the Court have power to make such other orders as each respectively thinks fit regulating the contract of employment between the employee and the related body corporate, and otherwise dealing with accrued entitlements, continuity of employment and all other matters necessary to give practical effect to the reinstatement order.
(4) In this section related body corporate has the same meaning as that term has in section 9 of the Corporations Act 2001.
2 After Section 178
Insert:
(1) This section applies where:
(a) a company (the related body corporate) has entered into a contract for the carrying out of work for or on its behalf by a related company (the employer), including a contract or arrangement to hire labour from the employer; and
(b) the employer has contracted to undertake work for or on behalf of the related body corporate, including the provision of labour services to the related body corporate; and
(c) employees of the employer are engaged in carrying out the work (the relevant employees); and
(d) the work is carried out in connection with a business undertaking of the related body corporate; and
(e) the relevant employees are, or at the time of the non payment were, subject to an award, an order of the Commission, a certified agreement or an Australian Workplace Agreement.
(2) The related body corporate is liable for the payment of any legal entitlements of the relevant employees that have not been paid for work done by the employees in connection with the contract unless the related body corporate has a written statement given by the employer under this section.
(3) The written statement for the purpose of this section is a statement by the employer that all legal entitlements payable to the relevant employees for work under the contract done during the period specified in the statement that have been paid. The regulations may make provision for or with respect to the form of the written statement.
(4) The related body corporate and the employer must keep a copy of any written statement under this section for at least 6 years after it was given.
(5) The related body corporate may withhold any payment due to the employer under the contract until the employer gives a written statement under this section for any period up to the date of the statement. Any penalty for late payment under the contract does not apply to any payment withheld under this subsection.
(6) The written statement is not effective to relieve the related body corporate of liability under this section if a reasonable person in the position of the related body corporate would, when given the statement, have reason to believe it was false.
(7) An employer who gives the related body corporate a written statement knowing it to be false is guilty of an offence.
Maximum penalty: 10,000 penalty units.
(8) The provisions of this Act relating to the recovery of amounts payable under relevant legislation, an award, an order of the Commission, a certified agreement or an Australian Workplace Agreement apply to the recovery of legal entitlements payable by a related body corporate under this section.
(9) To avoid doubt, this section extends to a contract if the employer is in receivership or in the course of being wound up unless payments made under the contract are made to the receiver or liquidator specifically in respect to the legal entitlements of the employees.
(10) In this section:
legal entitlements means remuneration and all other amounts payable to relevant employees under relevant legislation, an award, an order of the Commission, a certified agreement or an Australian Workplace Agreement in connection with work done by the employees, and includes but is not limited to accrued leave entitlements, sick leave, superannuation, redundancy and severance pay entitlements.
related body corporate has the same meaning as that term has in section 9 of the Corporations Act 2001.