s558B-1: s 558B(1) Responsible franchisor entities: take reasonable steps to prevent franchisee contraventions
A franchisor (including a subfranchisor) with a significant degree of influence or control over a franchisee entity's affairs contravenes s 558B(1) when the franchisee, acting as franchisee, contravenes a listed provision (NES, award, enterprise agreement, national minimum wage, pay frequency and method, unreasonable requirements to spend or pay, guarantees of annual earnings, sham contracting ss 357 to 359, records s 535 and pay slips s 536) and the franchisor or one of its officers knew or could reasonably be expected to have known the contravention, or one of the same or a similar character, would or was likely to occur. It is a defence that the franchisor had taken reasonable steps to prevent such contraventions. In judging reasonable steps a court may consider the franchise's size and resources, the franchisor's ability to influence the franchisee, action to ensure franchisees know their workplace obligations, arrangements for assessing franchisee compliance and for receiving and addressing underpayment complaints within the franchise, and whether the franchise arrangements encourage or require compliance. A franchisee entity is one whose business is substantially or materially associated with the franchise's intellectual property (s 558A).
Our statement of the clause of Australia Fair Work Act 2009 (Cth), held and verified: cite it as s558B-1. The instrument verbatim is not quoted here; the held framework carries the reading.
The evidence this duty asks you to hold
Franchise agreement clauses and operations manual requiring compliance with the Fair Work Act, awards, records and pay slips; Franchisee workplace law training and onboarding records; Network payroll audit programme with audit reports and remediation tracking for each franchisee; Complaints or hotline channel for franchisee employees, with a log of underpayment complaints and outcomes
What usually goes missing
Franchisor monitors sales and brand standards but never wages; Royalty and pricing models that leave franchisees unable to pay award rates, with no review; Underpayment complaints from franchisee staff referred back to the franchisee without follow-up; Officers aware of repeat franchisee underpayments without escalation
Where this lands in an audit
In Equal Pay Auditor this control informs the same-work screen, the category figures and the remediation steps, which carry their article citations on the result.