Employment compliance isn’t just an HR problem – it’s a board imperative
As Australia’s workplace laws grow in complexity, so too do the compliance obligations of corporate boards in Australia. Once viewed as a function of human resources or middle management, employment compliance now sits squarely within the remit of directors.
Modern regulators expect active governance, and courts are increasingly willing to impose personal liability on directors who have failed to implement or oversee adequate systems to protect employees. The consequence is that, in the event of an employment compliance failure, directors may face not only reputational and organisational consequences but also personal liability.
Against this backdrop, boards must ask themselves a critical question: Are we discharging our duties in a manner that sufficiently mitigates employment-related risks, both for the organisation and for individual directors?
Ordinarily directors are not personally liable for actions they take on behalf of the company they serve. This is often referred to as the “corporate veil.” However, the corporate veil may be lifted and personal liability can arise in specific circumstances, including breaches of employment law. Under instruments such as the Fair Work Act 2009 (Cth) (FW Act), Sex Discrimination Act 1984 (Cth) (SD Act), state anti-discrimination laws, and various WHS regulations, directors may be held...
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