Australia’s workplace relations regulator takes aim at Horticulture employers on the Mornington Peninsula

The Fair Work Ombudsman is Australia’s workplace relations regulator.  If it finds a workplace law has been breached, it uses its compliance and enforcement powers to resolve the issue.

The Fair Work Ombudsman has powers to investigate, fine and prosecute employers for non-compliance with the Fair Work Act. Some breaches of the Fair Work Act are now criminal offences which means businesses and their personnel can be fined or imprisoned for intentional underpayment of wages or entitlements.[1]

Increased regulatory focus on the Agricultural sector

The Agricultural sector is a priority focus area for the Fair Work Ombudsman because it is an industry that poses a significant risk of systemic non-compliance with workplace laws.

Last week, the Fair Work Ombudsman released its Horticulture Compliance Report. The Report is a culmination of findings from targeted investigations into grower and labour hire providers in key regional hot spots from December 2021 to November 2024.[2]

The worst complying regions were identified in Victoria. The Mornington Peninsula and Yarra Valley were the worst offending followed by Shepparton.

The Fair Work Ombudsman is now considering enforcement action against non-complying growers and labour hire providers in these regions.[3]

The Fair Work Ombudsman’s investigation findings  

The Fair Work Ombudsman investigated growers and labour hire providers in these regions for compliance with piecework rates, wage rates for casuals under the Horticulture Award and pay slip and recording keeping compliance. It found that the worst offending was committed by the labour hire providers as the primary employers of workers supplied to growers.[4]

Non-compliance was driven by systemic practices including:

1. cash in hand payments to vulnerable migrant workers who were less likely to understand their rights or speak up against wrongdoing;
2. workers not knowing who their employer was in a system where farms engage labour hire entities for the supply of seasonal labour; and
3. labour hire entities engaging in fraudulent practices, including fraudulently claiming to hold a labour hire licence, misrepresenting the true employer of the labour and providing false or misleading employment records.[5]

Growers and famers were also found to have contravened workplace laws, with the Fair Work Ombudsman finding[6]:

1. widespread misunderstanding and misapplication of entitlements as the main cause of contraventions by growers; and
2. common breaches including underpayment of casual rates, failing to pay leave loading entitlements, misapplication of overtime and time off in lieu arrangements, and incorrect classification of employees.

Growers beware

Engaging labour hire providers is lawful provided growers ensure that the provider is licenced under applicable laws. However, growers are not immune from the unlawful conduct of labour hire providers once they have been engaged.

The Fair Work Act has accessory liability provisions which mean that persons procuring labour hire may be legally responsible when they are involved in their contractor’s or subcontractor’s underpayment of staff.

What you can do now, to protect your farm

Considering the Fair Work Ombudsman’s increased regulatory focus on the Horticulture sector in regional Victoria, growers should urgently review current processes and practices, including as follows:

1. ensure you only engage licenced labour hire entities that can demonstrate they hold a valid and current licence issued by the Victorian Labour Hire Authority;
2. review and update your service or supply contracts with labour hire providers. These contracts should be prepared by lawyers with relevant expertise. For example, it would be prudent to negotiate rights to access and review worker records and governance systems of the labour hire provider, and to include robust contractual protections for circumstances where the provider engages in wrongdoing or non-compliance with workplace laws;
3. if your business is engaging workers directly, ensure:
4. 1. you are up to date with new pieceworker requirements[7]; and
   2. you are applying the correct award classifications for your workers and have appropriate systems in place to monitor work hours, and to support the provision of accurate pay slips and record keeping.

Coulter Legal has experienced lawyers who specialise in working with small and medium sized agri-businesses.

Alexandra Gronow is a senior employment lawyer located on the Mornington Peninsula and servicing the Geelong, Surf Coast and Bellarine Peninsula.

Please email Alexandra Gronow at agronow@coulterlegal.com.au for further information or assistance.

[1] See our previous article from January 2025: Are you up to date with the new wage theft laws?
[2] Horticulture Compliance Report – Fair Work Ombudsman
[3] Ibid 26.
[4] Ibid 10.
[5] Ibid 13.
[6] Ibid 15.
[7] Pieceworker rules under the Horticulture Award changed in 2022. Pieceworkers have a minimum wage guarantee and employers must keep a record of the hours a worker works each day and the applicable piece rates for those hours.