“Employer-of-Record” vs “True Employer”

The recent NSW Supreme Court decision in Branded Media Holdings[1] holds some important lessons for recruiters and others who are considering the use of outsourced employer-of-record (EoR) services – especially if they imagine that using EoR services will protect them, in all cases, from liability as the “true employer”.  That’s because statutory and common law liabilities generally rest with the true employer, irrespective of where formal documents might be trying to direct them

In Branded Media, liquidators and deed administrators of two related companies sought directions from the court as to the identity of the employer of specified employees within the Branded Media Group.

The companies were Branded Media Holdings Pty Ltd (in liq) (Holdings) and Brand New Media Pty Ltd (subject to a deed of arrangement) (BNM). The liquidators and deed administrators’ position was that Holdings was the employer.

The Commonwealth intervened to contend that BNM was the employer. The Commonwealth had advanced more than $1 million in respect of the employees’ unpaid entitlements under the Fair Entitlements Guarantee Act 2012  and stood to recover a substantially higher amount if BNM was held to be the true employer.

The contest was clouded by uncertainty because, whilst the formal documents recorded Holdings as the employer, day-to-day management of the work relationship was conducted by BNM.

The court held that the true employer was BNM. Some telling factors included:

  • Holdings did not conduct any business by which it generated income;
  • Holdings was not the recipient of the services of the employees;
  • the employees provided their services to BNM;
  • Holdings was wholly dependent upon BNM to meet its financial obligations;
  • Holdings did not operate any bank accounts;
  • Holdings did not in fact pay the employees;
  • BNM in fact paid the salaries and wages of the employees;
  • BNM had its logo on some employment forms;
  • business cards used by the employees bore the logo of BNM;
  • the sign-off section of emails sent by the employees referenced BNM;
  • the website referencing the Employees referenced BNM.

You might already be getting a sense of how some of those factors might play out in a case where a staffing agency supplies workers to one of its clients, managing their shifts, providing them with agency uniforms, and binding them to agency policies; but arranging for those workers to be employed “on-the-record” by an outsourced payroll company.  

The Branded Media case is important because the Court clarified the principles that are used to determine which of the two companies was the actual employer. In doing so, it made clear that:

The Court must look to the “substance and reality” in identifying the true employer in these circumstances and would look beyond contractual documentation and to the reality of the manner in which the parties conducted themselves in order to do so.[1]

[The Court may also] have regard to whether the suggested arrangement had an “intelligible business objective” which is “consistent with the financial and administrative organisation of the business”.[2]

The case is also helpful to the extent to which it clarifies that employment-of-record is not a distinct category of employment, but nothing more than an expression to describe an arrangement by which certain of the true employer’s statutory or contractual responsibilities are performed by someone else.

Such an arrangement will not necessarily relieve the true employer of those responsibilities if the EoR fails in performance. And some liabilities, such as the employer’s vicarious liability at common law, may continue to rest with the true employer to the extent to which they derive from the true employer’s notional control of its employees.

The need to identify the true employer will also arise in the context of labour hire licensing prosecutions to the extent to which it may be necessary to determine whether workers of an unlicensed provider who has sought to outsource the obligation to pay its workers to an EoR payroll company may be left with the residue of the statutory obligation to pay sufficient to necessitate the holding of a licence -despite having passed to the EoR a contractual obligation to pay the workers.

Andrew C. Wood


[1] In the matter of Branded Media Holdings Pty Limited (in liquidation); In the matter of Brand New Media Pty Limited (subject to a Deed of Company Arrangement) [2020] NSWSC 557 at [14] adopting Counsel’s submission to that effect.

[2] At [26], developing a further dimension to the test which may be effective to challenge sham arrangements directed at avoidance.

WorkAccord’s “Tuesday TalkAbout” to Return in July

Slide17WorkAccord’s “Tuesday TalkAbout” series of free, short webinars is set to return for a fourth season at 8:30 am AEST on July 21st 2020.

With The Recruitment, Consulting & Staffing Association’s new Code for Professional Conduct, authorised by the ACCC last year, commencing on August 8, the focus of the series will be on the Code’s principles of operational integrity.

As the author of the Code, I’m looking forward to  discussing topics such as Confidentiality, Care, Complaints Handling, Certainty of Engagement, Social Sustainability, Assurance, and Disclosure.

Here’s the Winter programme:

1.   RCSA Code: What’s New? (21/07/20)

Our first Tuesday TalkAbout for the Winter 2020 season presents an overview of the RCSA Code for Professional Conduct and asks, “What’s new?”

We’ll explain why this Code is different from what has gone before. We’ll explore the ethical principles that underpin the Code; and look at its statement of principles for personal professionalism and operational integrity. Finally, we’ll discover what the Code requires of RCSA Members and how RCSA supports its Members’ journey along the “Pathway to Professionalism”.

2.   Social Sustainability (28/07/20)

The new RCSA Code requires Members to

  • conduct business in a way that avoids causing or contributing to exploitation through their activities; and
  • seek to prevent or mitigate risks of exploitation that are linked to their operations or services by their business relationships, even if they have not contributed to those risks.

In this session, we’ll discover what the Code means when it talks about “exploitation” and we’ll learn about steps that you can take along your pathway to professionalism to reduce the risk of exploitation in your service networks.

You can register for this webinar here.

3.   Ascertain & Assure (4/08/20)

RCSA Members will be required to:

  • apply resources; and
  • establish and maintain controls

to ascertain and assure themselves, to a reasonable standard of confidence, that they meet the requirements of the regulatory environment in which they operate.

This session focuses on how to identify regulatory requirements and what types of controls you can implement in a recruitment and staffing environment to be confident that you are meeting them.

You can register for this webinar here.

4.   Certainty of Engagement (11/08/20)

Under RCSA’s new Code, Members will need to take reasonable steps:

  • to ensure the certainty, transparency, and scope of their agreements; and
  • to obtain adequately informed consent

for the provision of a workforce service, or for the performance of a service network role.

In this session, we’ll talk about provisions that present regular challenges and discuss what you can do to make their operation more certain. We’ll look at scoping provisions, screening responsibilities, fees & charges, restraints of trade, candidate replacement and other guarantees.

You can register for this webinar here.

5.   Confidentiality & Privacy (18/08/20)

Recruitment & staffing professionals handle vast quantities of confidential and personal information. Much of it is highly sensitive.

In this session, we’ll talk about some of the challenges that you will face and how you can deal with them. You’ll learn to identify when information is confidential and how to handle exceptions. You’ll learn about the different privacy regimes that you might operate within and why it is important to have a good understanding of your privacy obligations when you are obtaining consent to collect, use and disclose personal information. We’ll also look briefly at some of the additional issues that arise when you are operating in an on-line environment.

You can register for this webinar here.

6.   Complaints Handling (25/08/20)

RCSA Members will be required to establish and maintain credible grievance handling mechanisms and corrective action procedures, appropriate to their size and circumstances, to address any failure to meet the standard of professional conduct required by the RCSA Code.

In this session we will talk about how you can do that, using some of the principles in AS/NZS 10002:2014 Guidelines for complaint management in organizations.

You can register for this webinar here.

7.   Care (1/09/20)

A concept of care, requiring attentiveness, responsibility, competence, and responsiveness underpins the new RCSA Code for Professional Conduct.

In this session, we’ll explore the concept of care and talk about its specific application to Members’ responsibility to meet the value promises they make about the quality of their services. Is there room, in a professional conduct framework, for an “all-care-no-responsibility” approach anymore? Let’s find out!

You can register for this webinar here.

Let’s talk again soon!

Andrew C. Wood Hon, FRCSA (Life)

 

 

 

 

WorkAccord’s Autumn “Tuesday TalkAbout” Programme: Healthcare Workforce Recruitment & Staffing Focus

Autumn TT promoIn WorkAccord’s Summer series of Tuesday TalkAbouts, we introduced the concept of “waypoints” as those points on a journey where we can pause, take stock, and choose the direction we will follow for the next stage. As the COVID-19 pandemic response has rapidly escalated, it seems that we might have rushed through several of those waypoints and might now be asking, “What comes next?”

Many within the healthcare recruitment and staffing sector are experiencing a sense of considerable uncertainty, which may become costly. For some, it has been a case of having been so busy that there has not been time to reflect on what has happened. For others, things have gone unnervingly quiet.

In our Autumn series of Tuesday TalkAbouts, we will be looking at points of continuity and change for healthcare recruitment & staffing professionals and asking, “What does it now take to be Leaders in the World of Work?”

We will also be working throughout this series to develop the Tuesday TalkAbout format to provide participants with an enhanced range of on-line/off-line and synchronous/asynchronous learning opportunities and resources. We’ll be keeping the free on-demand webinars while developing the live sessions to provide more interaction and opportunity for discussion.

I’m delighted, therefore, to extend to all a warm invitation to participate in this exciting collaborative project.

Our Autumn programme of seven free webinars is outlined below.

1. Platforms (21/04/2020)

Our first Tuesday TalkAbout presents an “under the hood” look at Recruitment Platforms for Recruitment & Staffing Professionals.

What are they? Where do they fit in the classification of recruitment & staffing services? How do we “read” them? What are some of the opportunities and risks associated with their use?

2. A Healthcare Workforce that Nobody “Owns” (28/04/2020)

A healthcare workforce is a complex, multi-actor (multi-nodal) system that possibly nobody “owns”.

What are its governance challenges? What do these challenges mean for stakeholders, including Recruitment & Staffing Professionals aspiring to be Leaders in the World of Work? How can they engage more effectively with the workforce to enhance the value of the contribution they make?

3. Healthcare Worker Engagement Models (5/05/2020)

Healthcare worker engagement models come in many different forms.

What models of healthcare worker engagement are most relevant for Recruitment & Staffing Professionals? How can they distinguish between different models to choose the ones that are the most suitable? What challenges do procurement approaches pose to the successful engagement of health workers with their workforce? How can Recruitment & Staffing Professionals meet those challenges?

4. Aged Care Workforce Update (12/05/2020)

The Royal Commission Into Aged Care Quality & Safety has been running since October 2018.

What progress has been made so far? Who making submissions? What themes are emerging that will be significant for Recruitment & Staffing Professionals working in the Aged Care sector? What will happen next? And how can we make a submission?

5. Telemedicine & Recruitment (19/05/2020)

Social distancing measures under the conditions of the COVID-19 pandemic presented many challenges to the way we have traditionally thought healthcare and health workforce recruitment should be practised.

What are the consequences for healthcare workforce recruitment and for Recruitment & Staffing Professionals working in the healthcare sector? In this Tuesday TalkAbout we will review some of the current literature and take a look at some recent practice developments in the field of Telemedicine.

6. Collaborative Supply Models: Concept (26/05/2020)

Collaborative Supply Models or “Networks” may provide useful answers to many of the challenges presently facing healthcare workforce structure and governance.

What form could they take? What role might Recruitment & Staffing Professionals working in the healthcare sector play in their development? In this Tuesday TalkAbout, we’ll look at some of the collaborative supply or network models that have been developed and deployed in Australia and overseas. We will begin to explore how they might evolve to create new opportunities for Recruitment & Staffing Professionals responding to a disrupted workforce environment.

7. Collaborative Supply Models: Topical Challenges (2/06/2020)

In this Tuesday TalkAbout, we’ll build on the concept of a Collaborative Supply Model which we developed In the previous session for Recruitment & Staffing Professionals working in the healthcare sector. We’ll focus on four topical challenges:

  • Candidate connection & protection
  • Competition
  • Risk & liability
  • Governance

You can register for this webinar here.

Let’s talk again soon!

Andrew C. Wood

 

 

 

 

Tuesday TalkAbout Returns with a Health Workforce Staffing & Recruitment Focus

Slide1

Over the past couple of months we’ve all been affected by social isolation and lockdown. We’ve been learning new ways of working and new methods of getting things done. There have been signs that it’s been coming for a while, with recent Health Service tenders calling for submisisons on platforms, networks, and technologies to facilitate the process of assembling and managing a Health Workforce.

So, our first Tuesday TalkAbout in WorkAccord;s Autumn  2020 series will kick off with an “under the hood” look at Recruitment Platforms for Health WorkForce Staffing Professionals. What are they? Where do they fit in the classification of recruitment & staffing services? What are some of the opportunities and risks associated with their use?

I hope you’ll join us for our free ZOOM webinar at 8:30 am AEST on Tuesday 21 April 2020 when we’ll commence our 7 week discussion of Health Workforce topics.

And for those who are unable to make it, don’t worry. The webinar will be recorded and made available free and on demand for up to two weeks following the presentation.

You can register here or copy thand paste the link below in your browser https://us02web.zoom.us/webinar/register/WN_IaYSqLjeR1C9Zm6a_iuOpQ

Let’s talk again soon.

 

Andrew C. Wood

Royal Commission into Aged Care Quality & Safety seeking submissions. Might the recruitment & staffing sector bring something fresh to the table?

Aged Care CommissionThe Royal Commission into Aged Care Quality & Safety continues to seek submissions to its December 2019 Consultation Paper.  Submissions can now be made until the end of April 2020.

The  January closing date, as originally proposed, was awful, with many people distracted by holidays, bushfires, storms, floods and return to schol.  But the Royal Commission has recently indicated that it will accept submisisons until the end of April. So, there might still be time to engage!

It would be marvellous to hear what contribution the recruitment and staffing sector could make to the design of a more effective aged care workforce.

That’s because one of the key questions on which submisisons are being sought is:

How could the aged care and health systems work together to deliver care which better meets the complex health needs of older people, including dementia care as well as palliative and end of life care? What are the best models for these forms of care?

It’s an important question. Sadly, the Consultation Paper puts it in the context of numerous system deficiencies.

[The current system] struggles to attract and retain sufficient numbers of skilled, knowledgeable and competent staff (p.3).

…low levels of clinical staff and personal carers in residential care and poor interfaces with the health system mean that some people may not receive the level of nursing, allied health and personal care services they need and would otherwise have had access to within the community or from the health system. (p.13).

The majority of staff are personal care workers rather than nurses or allied health professionals.  (p.14).

The delivery of services to rural and remote geographical regions in Australia is complex and differs for every community. It is impacted by multiple socioeconomic factors and the physical environment, such as the high cost of goods, utilities, transport, fuel, food and vehicles. There is often limited access to most government services and a shortage of staff to support those services. (p.18).

I reckon it would make a huge difference to address the challenge of designing a better aged care workforce from the perspective of appreciating the resources we do have. And in that context, it would be marvellous to hear about the solutions that innovative and resourceful staffing & recruitment professionals could suggest!

So, I’d like urge the recruitment and staffing sector to engage with the questions that are being asked and see if there’s something fresh that can be brought to the table – befitting “Leaders in the World of Work”.

How about it?

 

Andrew C. Wood

“Tuesday TalkAbout” Summer 2020 Program to Address Recruitment & Staffing Sector “Waypoints”

Tuesday TalkAbout takes a new direction for its Summer 2020 Program of free, short webinars, as we discuss some larger themes at work in the recruitment and staffing sector.

Now, I certainly don’t claim to be a seer or a futurist. I observe and interpret. So, I’m not going to attempt to predict the course of the decade or anything like that.

Instead, I’ll describe the “waypoints”, which I think the recruitment & staffing sector in Australia and New Zealand has reached in eight key areas. ‘

A “waypoint” can be understood as a place on a route or pathway, a stopping point, or a point at which one’s course can be changed.

What the future holds from that point forward largely flows from the decisions and commitments which recruitment & staffing professionals make for their own organisations and professional lives – either intentionally or by default.

The observations and insights that I hope to share reflect experience gained over four decades in legal and workforce consulting practice and in recent work done with RCSA, designing its new Code for Professional Conduct, its grievance intervention guidelines & protocols, its StaffSure certification program, and many of its key resources and templates.

The eight key areas we’ll be discussing are:

1. Professional Conduct (21st January)

RCSA’s new Code for Professional Conduct has been authorised by the ACCC to commence on 8 August 2020. How is it different from previous codes or other industry codes? Why is it different? What statement does it make about emerging professionalism? How might recruitment & staffing professionals respond to it? How is it enforced and administered?

This webinar has now been archived. Please contact me if you would like a link.

2. Quality Management (28th January)

What does “quality” mean in the context of the work undertaken by recruitment & staffing professionals as labour market enablers and intermediaries. Does the ISO 9001 definition of “quality” say it all? How well does the “customer focus” requirement stand up to the professional conduct responsibilities of recruitment & staffing professionals? Is quality perceived as outcome or experience? Is it even an either/or question?

This webinar has now been archived. Please contact me if you would like a link.

3. Risk Management (4th February)

We know (at least I hope we do) that risk is defined for the purposes of risk management and quality management standards as the “effect of uncertainty on objectives”. But how might risk be categorised to be more manageable for recruitment & staffing professionals? What sorts of risk do recruitment & staffing professionals face in 2020? At what points does risk intersect with professionalism and quality? How can risk be managed to minimise its effects on professional and quality objectives?

This webinar has now been archived. Please contact me if you would like a link.

4. Collaboration (11th February)

What is “collaboration”, really? Why is it important for recruitment & staffing professionals in 2020? Is collaboration possible with customers and clients? Candidates? Competitors? Consultants? If so, how is achieved? How is it managed and maintained?

This webinar has now been archived. Please contact me if you would like a link.

5. Doing Business (18th February)

Something is wrong if you’re not upgrading your terms of business at least as frequently as your mobile phone! Wonder why you’re getting pushback from clients who won’t pay you that “introduction fee”, or who won’t sign up to your “all-care-no-responsibility” conditions? Terms of business modelled on 1980s recruitment & staffing practices and 1980s legal culture are no longer viable. In this session, we explain why and talk about what you can do about that.

This webinar has now been archived. Please contact me if you would like a link.

6. Conflict & Dispute Resolution (25th February)

Even for those who might be energised by conflict, there comes a point when stocks of energy and finances to meet the crushing cost of feeding conflict, run low. What is your conflict/ dispute profile? Do you still handle business disputes like it’s the 1980s and you’re a bank? Or have you found a better way? What are your options in 2020? What distinguishes the way you handle conflict and disputes as “professional”?

View the recorded Conflict & Dispute Resolution “Waypoint” webinar here

7. Employment Shaping (3rd March)

What is the difference between legitimate employment shaping and sham contracting or avoidance? How much flexibility is there to shape an employment relationship to suit labour market conditions in 2020? What are the limits? How do you know if you are approaching or transgressing them? Are there any “golden rules”. If so, what are they and how do you apply them?

View the recorded Employment Shaping “Waypoint” webinar here

8. Independent contractor on-hire (10th March)

What are the main challenges to independent contractor on-hire in 2020? Is the business integration test still reliable? What investigations should a recruitment & staffing professional undertake to ensure that independent contractor engagement and on-hire models are compliant with a wide range of regulatory requirements and are not exploitative?

Register for the Independent Contractor On-Hire “Waypoint” webinar here

I do hope you’ll join me when WorkAccord’s Tuesday TalkAbout Summer Program returns at 8:30 am AEDT on Tuesday 21 January 2020 and I’d love to learn of any questions you might have in advance.

 

Andrew C. Wood

Industry Certification Schemes – Regulatory Alternatives?

TT_8 Cwertification Full

Can industry certification schemes be viable alternatives to statutory licensing schemes?

In WorkAccord’s next free Tuesday TalkAbout I’ll discuss different types of certification schemes and consider their pros and cons as regulatory alternatives. In doing so, I’ll also look at Regulatory Impact Statement that supported the Victorian licensing scheme to see how it worked. What assumptions were made? Were they correct? How might a federal RIS and outcome differ?

I hope you’ll join me.

Andrew C. Wood

 

Labour Hire Licensing Laws: Do they apply outside their home states?

ExtraterritorialityQueensland, South Australia, and Victoria have now all passed separate labour hire licensing laws[1].

All three acts contain provisions that attempt to extend their application beyond state boundaries.[2] The exact wording in each case is different but basically, they attempt to extend the laws to the maximum extent of the legislative power of their respective Parliaments. No one knows for sure exactly what that is because it hasn’t been tested in this context. But it seems generally correct to say that, provided there is some real connection (or nexus), with the home state, the laws are capable of applying in some other state (or country). Continue reading

Let’s Shed Light on Recruitment Fees!

 

Slide1Temp-to-Perm Fees, Agency-Switching Fees, Introduction Fees and Release Fees.

I hope you’ll join me when we shed light on the topic of Recruitment Fees in two separate webinars planned for Thursday 22nd November and Thursday 29th November at 10:30 am AEDT.

In our first webinar, you’ll learn how to make binding and enforceable recruitment fee agreements.

In our second webinar, you’ll learn how to manage fee recruitment disputes ethically and professionally.

You can find out more about the webinars in my Recruiters’ Casebook blog here.

 

Andrew C. Wood, Hon FRCSA (Life)

Two Webinars about Recruitment Fees

I’m looking forward to presenting two webinars on recruitment fee topics later this month. I’m looking forward to it because it’s a topic that I’m constantly asked about and one that needs to be mastered in the interests of promoting and maintaining professional standards in the recruitment and staffing industry.

Slide1Webinar #1: Make Binding & Effective Agreements (22nd Nov. 2019 )

In the first session, we will discuss how to make binding and effective recruitment fee agreements that will reduce the cost of disputes and help get your fees paid.

You’ll learn about:

  • basics of contract
  • the battle of forms – Does the client’s purchase order trump your standard terms?
  • traps when using standard form terms of business
  • State and Territory employment agent regulation
  • what happens if your terms of business are not signed?
  • terms of business that need special treatment.

 

RF2Webinar #2: Handle Disputes Ethically & Professionally (29th Nov. 2019)

In the second session, you will learn how to handle recruitment fee disputes professionally and ethically to preserve goodwill, reputation, and to improve payment outcomes.

You’ll learn about:

  • common causes of recruitment fee disputes
  • common defences to recruitment fee claims
  • traps to avoid when involved in disputes
  • RCSA Code of Conduct and Grievance Intervention Guidelines
  • pathways to resolution
  • the benefit of early intervention.

 

I hope you’ll join me. And if you have questions about the topic, please feel free to send them to me ahead of the event.

 

Andrew C. Wood, Hon FRCSA (Life)