Pleading ignorance or saying “they told me to” is no defence for HR professionals facing a charge of personal liability.
HR professionals should be aware that the misdeeds of their employers can also affect them personally, after a rise in the number of accessorial liability cases.
If your company breaches the National Employment Standards or the Fair Work Act, you as the HR manager could be help personally liable, says Mark Diserio, Partner at Lander & Rogers.
“Accessorial liability issues for individuals often arise in relation to sham contracting, underpayment, adverse action and discrimination, and breaches of the National Employment Standards (NES),” Diserio says.
He warns that even relatively minor actions can result in a person being held accessorily liable for breaches of the Fair Work Act.
“For example, a failure to give written notice of dismissal before dismissing a person from their employment would contravene the Fair Work Act,”
“The employer and any person involved in the contravention could then face proceedings.”
The Fair Work Act states that any person who is “involved” in a breach of the Act will be liable for a fine of up to $10,800, in addition to any fines that may be imposed against their employer.
And pleading ignorance isn’t going to help, as case law has established that the HR manager doesn’t need to be aware that their conduct constituted a breach of the FW Act in order to be "involved" in a contravention.
HR managers can’t defend themselves against personal liability charges by saying that they were just following orders from a senior manager or director either, Diserio says.
HR professionals can proactively take steps to minimise any risk to themselves and their organisation, Diserio says
“After all if there is an issue, it is better for it to be discovered by your organisation, rather than being brought to light by a whistle-blower, a union or the regulator where the financial and public relations consequences can be far reaching,” he says.
If HR suspects a breach of the Fair Work Act has occurred at their workplace, Diserio says they should consider doing the following:
- prepare a report noting the potential breach and recommending a remedy;
- communicate the report to your manager, supervisor or director;
- if your concern is ignored and you are directed to carry out the action, you should, if possible, refuse to implement the improper conduct and explain the reasons in writing; and
- think about whether legal professional privilege is a relevant consideration before taking some of the above steps.