Employee obligations and board oversight — student companion

Accounting Ahead | Original study resource | accountingahead.com.au

Obligations to employees

MODULE 4 | PART B.2 | STUDENT COMPANION

Employees, including executives, are central stakeholders. Management runs the people practices, but the

board approves the policies and must satisfy itself that they work.

Safe work

WHS duties to workers and anyone

affected; officers' due diligence;

psychosocial hazards

Fair pay

Awards, agreements and minimum

wages; deliberate underpayment is a

crime from 1 January 2025

Superannuation

Super guarantee of 12% from 1 July

2025; unpaid super can reach directors

personally

Leave

National Employment Standards are a

floor: annual, personal/carer's and

parental leave

Fair recruitment

No discrimination; reasonable

adjustments; honest job advertisements

Conduct and unions

A lived code of conduct; good faith

bargaining; freedom to join or not join

The board approves the policies and checks they work. It can delegate the tasks, not the responsibility.

Who oversees what

Area Main laws and bodies

Work health and safety Model WHS laws developed through Safe Work Australia; enforced by state and

territory regulators. Every state and territory now has an industrial manslaughter

offence.

Pay and conditions Fair Work Act: the Fair Work Commission sets awards and minimum wages; the Fair

Work Ombudsman enforces them. Anyone knowingly involved in an underpayment

can be personally liable.

Discrimination Federal anti-discrimination laws (age, sex, race, disability), overseen by the Australian

Human Rights Commission. Applicants are protected as well as employees.

Job advertisements Australian Consumer Law: it is unlawful to mislead people about a job's availability,

nature or terms.

Gender equality Larger employers report to the Workplace Gender Equality Agency.

ETHICS & GOVERNANCE | M4 PART B.2 | STUDENT COMPANION

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Accounting Ahead | Original study resource | accountingahead.com.au

Safety due diligence

MODULE 4 | PART B.2 | THE OFFICER'S PERSONAL DUTY

Under the model work health and safety laws, officers, including directors, must exercise due diligence to ensure

the business complies with its safety duties. The six steps below summarise what that requires.

1 Know

Keep safety knowledge up to date

2 Understand

Know the operations and the hazards they create

3

Resource

Provide resources and processes to remove or reduce

risks

4

Respond

Make sure incidents and hazards are reported and

acted on quickly

5

Comply

Make sure processes exist to meet every legal safety

duty

6

Verify

Check that the resources and processes are actually

used

Dreamworld, 2016: four deaths on the Thunder River Rapids ride

Ardent Leisure fined $3.6 million in 2020 for failing its primary safety duty. Policies on paper are not enough.

Pay, super and leave at a glance

Underpayment: since 1 January 2025, intentionally underpaying wages or entitlements is a federal crime (up

to 10 years' jail for individuals). Honest mistakes are not the target.

Salaries: an annual salary must still cover at least what the award would pay for the hours actually worked.

Super guarantee: 12% of eligible earnings from 1 July 2025, the final scheduled step up.

National Employment Standards: include 4 weeks' paid annual leave (full-time), 10 days' paid

personal/carer's leave, and up to 12 months' unpaid parental leave with a right to request more.

Real case: Ardent Leisure Ltd, Southport Magistrates Court, 28 September 2020 ($3.6 million, three charges under the Work Health and

Safety Act 2011 (Qld)). Lantern Cafes, Harbourview Freight, Ridgeline Quarries and Tidewater Logistics are imagined examples. Study

guide reference: Module 4, Part B, section 4.6.

ETHICS & GOVERNANCE | M4 PART B.2 | STUDENT COMPANION

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Accounting Ahead | Original study resource | accountingahead.com.au

Practice questions

MODULE 4 | PART B.2 | TRY THESE BEFORE THE WORKED ANSWERS

Question 1 - due diligence at Ridgeline Quarries

Imagine Ridgeline Quarries Ltd. Its board receives one safety number each month: the lost-time injury rate,

which is low. Site safety audits are eight months overdue, two directors have never visited a quarry, and a near

miss involving a reversing haul truck was never reported beyond the site manager. Using the six due diligence

steps, identify the gaps and say what the directors should do.

Question 2 - is the salary enough?

Imagine Lantern Cafes Pty Ltd pays its kitchen manager a salary of $86,000 a year. She works 50 hours every

week for 52 weeks. Assume illustrative award terms: an ordinary rate of $32 an hour for the first 38 hours, and

$48 an hour (time and a half) for every hour over 38. Ignore leave, loading and super. (a) What would the award

have paid for the year? (b) Is there a shortfall, and how much? (c) What should the company do?

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Accounting Ahead | Original study resource | accountingahead.com.au

Question 3 - spot the problems

Imagine Tidewater Logistics Pty Ltd advertises: 'Warehouse team leader - permanent full-time. Applicants

must be aged 25 to 40, with no young children. $78,000 plus super.' The role is actually a six-month casual

contract. During hiring, the manager rejects a strong applicant who uses a wheelchair, without considering

whether the workplace could be adjusted. List each problem and explain why it matters.

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Accounting Ahead | Original study resource | accountingahead.com.au

Worked answers

MODULE 4 | PART B.2 | WORKED ANSWERS - ATTEMPT THE QUESTIONS FIRST

Question 1 - Ridgeline Quarries

Due diligence step Gap at Ridgeline What the directors should do

Know and understand Two directors have never seen the

operations; one lagging measure tells

them little.

Visit sites, get briefings on the main hazards

(haul trucks, blasting, dust) and ask for leading

indicators.

Resource Overdue audits suggest safety work is

under-resourced.

Fund and schedule the audits; check staffing

and equipment for critical controls.

Respond A serious near miss never reached the

board.

Require prompt reporting of near misses and

serious incidents, with actions and follow-up.

Comply and verify No evidence the board checks whether

processes work.

Ask for audit results, independent verification

and a tracked action plan at every meeting.

A low injury rate can hide serious risk. Near misses are free lessons: the board should want to hear about

them.

Question 2 - Lantern Cafes

(a) Weekly award amount: 38 x $32 = $1,216, plus 12 x $48 = $576, total $1,792. For 52 weeks: $93,184.

(b) Yes. $93,184 - $86,000 = $7,184 short for the year.

(c) Pay the shortfall promptly, review the salary against actual hours regularly, and fix the process. A

deliberate decision not to pay could now be a crime, and anyone knowingly involved could be personally

liable.

Question 3 - Tidewater Logistics

Age limit (25 to 40): age discrimination against applicants outside the range.

'No young children': discrimination based on family or carer responsibilities.

Wheelchair user rejected without considering adjustments: likely disability discrimination; the employer

must consider reasonable adjustments unless they would cause unjustifiable hardship.

'Permanent full-time' when it is a six-month casual contract: misleading people about the nature and

terms of a job, which the Australian Consumer Law prohibits.

Fix: define the genuine requirements of the role, assess every applicant against them, and describe the job

accurately.

ETHICS & GOVERNANCE | M4 PART B.2 | WORKED ANSWERS

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