Australia's fair work ombudsman to audit councils' procurement processes

16 August 2015

Australian councils will be audited to make sure procurement processes do not undermine compliance with workplace rules.

Metropolitan and regional councils across the country will be randomly audited as part of a fair work ombudsman campaign with the aim of ensuring local government procurement decisions are not undermining compliance with federal workplace laws.

The ombudsman acknowledged contracting out labour was a legitimate approach to doing business, but said councils needed to consider whether their procurement processes and subsequent governance created an environment where workers were open to exploitation.

“It is important that local councils understand that when they sign low-cost contracts to buy in security services, they are not contributing to the underpayment of employees working for their sub-contractors,” said fair work ombudsman Natalie James.

The ombudsman has been working with the Australian Security Industry Association (ASIAL) and the United Voice union since May last year to educate local councils about their workplace obligations.

ASIAL chief executive Bryan de Caires said the campaign would benefit security service providers who are complying with workplace laws by helping to create a level playing field.

“If the price is too good to be true, it probably means somebody is not compliant with workplace laws,” he said. “Operators who are gaining unlawful and unfair competitive advantage are profiting at the expense of the workers and the legitimate operators who are doing the right thing.”

In 2009, the Fair Work Ombudsman audited over 300 security businesses as part of a national campaign and found that less than half were compliant with workplace laws.

A follow-up campaign in 2012 saw a significant improvement, with 75 per cent of the 392 businesses audited found to be meeting their obligations.

This latest investigation is expected to take a year, with a report scheduled for August next year.

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