Right To Work checks — the most overlooked compliance obligation in Australia?

Because it sits outside the Fairwork Act and other related employment legislation, the obligation of every employer to check (and monitor) the Right To Work of all staff is in my opinion, the most overlooked compliance obligation in Australian HR and Payroll departments.

Compliance enforced by the Department of Home Affairs

I’ve tried to distill the key points of the legislation herein:

Employer Obligations

  • Validating Australian citizenship; or
  • Validating the Work Rights of Non-Citizens;

Employing Australian Citizens

  • An Australian Passport;
  • An Australian birth certificate + photo ID;
  • An Australian Citizenship Certificate + photo ID;

Employing Non-Citizens

Furthermore, in the case of non-citizens, where the staff member is a temporary visa holder (rather than a permanent resident), the employer must take “reasonable steps, at reasonable times” to validate the Right To Work is maintained throughout their employment.

Why Is Performing Right To Work Checks Now More important Than Before?

The answer is Single Touch Payroll. Since July 2019, every Australian employer is obligated to report pay activity to the ATO on a pay cycle basis. The ATO now has almost real-time information on who is being employed and actively paid in Australia. And here comes the kicker: they share this data under the Data Matching arrangements with other government agencies. This specifically includes the Department of Home Affairs.

Whereas historically Home Affairs has been a poorly resourced enforcement agency, relying on anonymous tip offs to perform “raids” dressed up as audits. STP and the data sharing arrangements with the ATO, now gives them near real-time data on who is being employed and paid in Australia. They simply cross match this data to who has the legal Right To Work and whammy, you have automated audits and targeted compliance!

The Fines & Reputational Risk

Whilst the fines to Employers, Directors and Officers under the strict liability system are hefty (and outlined here), the biggest risk to Australian business is that of reputation:

The Australian media has become part of the enforcement arm of the Department of Home Affairs, with populist views on “illegal workers” creating a media hungry for stories of non-compliance. The Department of Home Affairs publishes its prosecutions to a web-page and this is monitored by reporters keen to break the story.

Compliance Options

  1. DIY manual — keep good records and manually perform the Right To Work checks by citing the necessary documents, and in the case of non-citizens, performing a manual VEVO check at the time of recruitment and at “reasonable times” throughout their employment.
  2. Software automation — use software like vSure’s Enterprise Solution to embed/integrate a seamless process into your onboarding and to provide automated monitoring.
  3. Outsource — companies like CV Check, Checked.com.au, Equifax and more offer solutions for Right To Work screening pre-employment and beyond.

Originally published at https://www.vsure.com.au on May 22, 2020.

#CloudAccounting #Payroll. Strategy. Technology Consulting. @ValueAdders @vSureAustralia @TPPGAU Blogger. Presenter. Philosopher. NED. Husband of 1 & dad of 3