When can an HR professional be held personally liable?

HR practitioners may also be held liable as accessories under anti-discrimination legislation.

Developments in relation to labour hire licensing laws and proposed whistleblowing laws should also be carefully monitored as they too may render individuals personally liable. 

What is accessorial liability?

Accessorial liability is centred on an individual's involvement in a breach.

The primary contravener is generally an organisation.  For example, the organisation has committed a breach of the Fair Work Act by failing to pay its employees award wages or by taking adverse action against an employee.

Individuals who are employed by the organisation may be liable as accessories for breaches of the Fair Work Act committed by the organisation.  People who may be considered accessories under the Fair Work Act range from those who act as the agent through whom the employer commits the breach (eg the person telling the employee s/he is dismissed, or a recruitment agent) to individuals who provide support to the employer (eg HR managers).

Accessorial liability can attach to any civil penalty provision in the Fair Work Act, including breaches of:

• the National Employment Standards, Enterprise Agreements or Awards;
• other employment conditions, such as time of payment, issuing of payslips and keeping proper records; and
• the general protections provisions of the Fair Work Act (adverse action).

Accessorial liability can also arise under anti-discrimination legislation where an HR practitioner causes, instructs, induces, aids or permits an employee to engage in discriminatory conduct.  For example, an HR manager supports a manager to make a female employee redundant while she is on parental leave because the employee is on parental leave.

Other ways in which personal liability may arise

Queensland and South Australia have recently enacted labour hire licensing laws that apply to the supply of labour hire services.  An individual may be found personally liable for providing labour hire services without a licence or for entering into an arrangement with an unlicensed provider.  Similar legislation is proposed for Victoria.

Under proposed whistleblower reforms in the private sector, an individual may be personally liable if s/he fails to keep the identity of a whistleblower confidential or victimises, or threatens to victimise a whistleblower.

What penalties could an HR practitioner face?

How do I manage these risks?

There are five key steps to managing these risks:

1. Awareness - Ensure that managerial (and HR) employees are aware of their personal liability risk.  It is important that these employees are aware that they have a personal responsibility to ensure that the provisions of the Fair Work Act, anti-discrimination laws and other workplace laws are complied with.
2. Training - Relevant employees should receive training to ensure that they are aware of the key provisions of the relevant laws, so they may monitor compliance with these laws in carrying out their roles.
3. Active participation - You should take an active role in ensuring that the organisation complies with the relevant laws.  As was demonstrated in FWO v NSH North Pty Ltd [2017] FCA 120, an employee may still be personally liable for a breach of the Fair Work Act in circumstances where an employee is implementing the decision of a more senior manager or a director.  
4. Record keeping - You should keep accurate and detailed notes of meetings and discussions.  This will assist to prove that the motives for your actions were not improper, which is especially relevant in adverse action claims.
5. Seek advice - And finally, if you are concerned about any decision, seek advice before proceeding.

HR practitioners are uniquely placed to influence and encourage compliance within organisations.  If you understand your role, the business and the legal framework within which your business operates, you are likely to be in a good position to positively influence the business in its employment decisions and minimise the risk of any successful proceedings against the business or against you personally. 

Julia Sutherland, Counsel, Aushurst