Enforceable Undertaking with the Fair Work Ombudsman
28 May 2016
Oaks Hotels & Resorts Limited (Oaks) engages Housekeepers Pty Ltd (Housekeepers) to provide cleaning services at its hotels and resorts throughout Australia. Housekeepers is a fully owned subsidiary of Oaks.
In 2014, the Fair Work Ombudsman (FWO) conducted an audit at two of Oaks’ hotels over a 6 month period to establish whether or not Housekeepers’ practices with respect to its cleaners were compliant with Commonwealth workplace laws.
The audit identified a number of significant contraventions of Commonwealth workplace laws. In particular, it identified that Housekeepers purported to engage cleaners as “independent contractors” when they were in fact and in law employees. This misclassification of the cleaners resulted in significant breaches of the Fair Work Act, the Fair Work Regulations and the Hospitality Industry (General) Award 2010, resulting in underpayments to the cleaners and non-payment of superannuation entitlements.
Oaks and Housekeepers have entered into separate Enforceable Undertakings with the FWO (available at www.fwo.gov.au) and have changed their business model so as to ensure that Housekeepers’ now engages cleaners as employees in compliance with Commonwealth workplace laws. This change has been completed.
Oaks acknowledges that:
- it has a moral and ethical responsibility to require standards of conduct from all entities and individuals involved in the conduct of its enterprise, that:
- comply with the law in relation to all workers at all of its sites; and
- meet Australian community and social expectations to provide equal, fair and safe work opportunities for all workers at all of its sites;
- the contracting model and business structure it implemented and used with Housekeepers to engage cleaners at its hotel and resort sites led to a situation where cleaners have been highly vulnerable to exploitation, including by way of underpayment and in contravention of the FW Act;
- it will take steps to improve the employment practices of its contractors and subcontractors in relation to cleaning services by implementing fundamental, permanent and sustainable changes to its business to ensure that:
- proper records are maintained for contractors and subcontractors allowing cleaners, Oaks and the FWO to verify that the workers are receiving their full entitlements;
- it has proper governance structures in place to monitor and regulate the arrangements of subcontractors;
- to the extent possible, cleaners who are underpaid are repaid their full entitlements; and
- to the extent possible, current and future cleaners at each of its hotel and resort sites receive the full entitlements due to them under Commonwealth workplace laws.
Enforceable undertaking between The Commonwealth of Australia (as represented by the Office of the Fair Work Ombudsman) and Oaks Hotels & Resorts Limited