Vulnerable Workers Act and the LPO - Progress Update

Help from some new law

The LPOG continues in its singular endeavour to get more money to Licensees without damaging the brand on which our livelihood depends. 

We identified for members in May 2017 and again in September 2017, some help from an unexpected source: the Federal Parliament.

As we know the Australia Post Licence network is a franchised system even though it is not so described.

The Federal Parliament in September passed the Fair Work Amendment (Protecting Vulnerable Workers) Act 2017 this new legislation marks a significant change in the risk profile for franchisors with respect to workplace relations matters, and specifically payment entitlements of employees within a franchised network. The Act represents a significant change in the level of responsibility that franchisors now have for contraventions relating to employee entitlements by franchisees.

Under the, so called, accessorial liability provisions the Courts will now look to what the franchisor knew or ought to have known, and did or should have done to prevent the contravention. This will significantly lower the bar in respect of franchisor liability.

A franchisor will be liable for the contraventions of its franchisees if:

  1. the franchisor has a significant degree of influence or control over the franchisee entity's affairs. This establishes the franchisor as a 'responsible franchisor' and therefore captured by the legislation. 
  2. the contravention by the franchisee occurs in the franchisee's capacity as a franchisee entity. 
  3. the responsible franchisor entity or an officer of it knew or could reasonably be expected to have known that the contravention would occur.


Members will know that LPOG has since it incorporated been singular in its endeavours with Post to get more money to licensees for reasons which include, the reason Licensees struggle to and indeed many, if not most, cannot afford to pay staff, including Licensees themselves who work as employees in their own businesses. LPOG is confident therefore Licensees can establish (a) and (b) and (c) above.

It can be seen that now Post, as well as Licensees, can be exposed to underpayments claims.

Since September LPOG has leveraged its attempts at negotiating change to the Licensees remuneration arrangements under the Licensed Post Office Agreement by taking into account this new exposure.

LPOG is presently heavily engaged in a dialogue with the new CEO about how to address what for Licensees has been a problem we have lived with for years, and what Post is now exposed to by reason of this recent law reform. LPOG has made representations to the Minister similarly. Post and its Licensees are, after all, delivering the Commonwealth's community service obligation.

These dialogues are continuing.

The presenting problem (Licensees are not paid well enough) is exactly that which is also before the ACCC on the LPOG's referral.

The presenting problem (Licensees are not paid well enough) is exactly as underpins certain Licensees' rights under the Independent Contractors Act 2006. Section 9(f) of that Act says a contract is unfair if: "the contract provides for remuneration at a rate that is, or is likely to be, less than the rate of remuneration for an employee performing similar work";

Posts employed managers are employees performing similar work.

In all of this Licensees may say: so what?

So What?

The so what is the impetus this law reform gives to Post and the Minister to address and address quickly the fundamental issue: how to get more money to Licensees.

LPOG has agitated, as an immediate solution, for the dividend paid by Post to the Commonwealth to be paid to Licensees. I repeat: Post and its Licensees are, after all, delivering the Commonwealth's community service obligation. We are told the immediate solution is no longer available as there will be no dividend. The immediate solution was not thought to be the intermediate or long term solution, in any event, although striking a profit should be secondary to paying people what they are worth, if not paying them according to the Commonwealth's own laws.

The long term solution is to maximise the revenue into the network on terms that Licensees get much more of that revenue for doing the work. That solution involves a whole of business reform. In this reform Licensees should be at the high table as equals.

It is by no means hopeless. Post's Licensed network is its best asset, and in the internet age of on-line purchasing leveraging of that is its best opportunity. There are others; retail banking and functioning as outlets for state and federal services across all public agencies is another. This is where the conversation engendered by your LPOG is at the moment.

Licensees have waited too long; many are unable to wait longer. LPOG understands this and is eager to use the present opportunity to accelerate our agenda.   

Suddenly our underfunding problem has become many other stakeholders problem, and for that we can be truly greatful!


Blackstar's picture

So they made a $95.4 million dollar profit after tax last year and are now mysteriously not paying a dividend to the government after having done so in all previous profit making years ?

westie's picture

Here's an idea. If there are 2,900 LPOs how about an ex-gratia payment of $1000 each? Only comes to $2.9M. How much is CCs salary package costing? Better still, how about $5,000 each? Still only $14.5M. Drop in the budget bucket. Not enough long term but could save those closest to the edge.

Sandgroper's picture

I think finally the ducks may be getting into some sort of a line. A lot of things seem to be falling into place from all sorts of directions. Thanks to our exec. and helpers for their dedication.

Bulahdee's picture

They look like they are saving their money for more big salary packages for the fat cats and forget about us mice

ASHA300's picture

An ex gratis payment is fine,but it has to cover the losses LPOS have born over the years.1k even 5k doesn't cut it either.
Post has declared profits each year,stuff the dividend to government,pay the LPOS that contribute much of the income to post so they can pay the salaries and show a profit.
LPO licensees that work daily 13-16 hrs days must at least receive the wage of a corporate manager.
I for just one,enjoy what we do,but am totally over doing it for love.
So AP board, federal government get up,understand what you have done to the LPO network, and dig into the profits in the bank,ask the gov to cough up also,and make a payment to LPOS that will benefit,show gratitude for efforts, and keep the network doors open.
1k 5k not enough,let's start at a fair payment,min $20k, let's face it, that's LESS than what we have all lost over the past few years,and will continue to loose until we are paid justly.

A sign on the door just may read very soon,
Due to ongoing underpayment to us by auspost,this post office is closed today,and each Friday until further notice.
Or simply just on strike,today,back tomorrow.

westie's picture

Sorry ASHA, I didn't phrase my statement very well. AP "owes" a total of $Billions to Licensees for chronic underpayment over a long period of time. Should be damages too, but there won't be any compensation for previous underpayments at all. At least that's my guess.
C1s promised review (which is waaaaaaay overdue) may take months and there is a risk of further Licensee failures before the review is completed, much less when implementation actually starts to make a difference.
My proposal was that AP make the ex-gratia payment to stave off bankruptcies in the short term and to be a first step to rebuilding trust with Licensees.
I have as yet no reason to trust C1 and I don't. I have every reason to distrust her, and I do. I also don't think I am on my own here. AF was a whiz with words and a king of spin. C1 talks the talk but I have yet to see her walk the walk.
A practical gesture, no matter how small, would give hope to the many Licensees currently consumed by cynicism.

ASHA300's picture

Westie,I understood,no problems, and agree with your thoughts,something must be done,as for trust,don't think I will or could ever trust them again,not that I did anyway.

They need to follow Caltex's lead and buy us all back. We have been dealing with them trying to get or issues sorted out. Maybe HQ is half listening but at State level they still hate us LPO's and they don't want to spend a cent on any of us we feel. We will never be able to trust our NM.