s558B-2: s 558B(2) Holding companies: take reasonable steps to prevent subsidiary employer contraventions
A body corporate contravenes s 558B(2) when a subsidiary (within the meaning of the Corporations Act 2001) that is an employer contravenes a listed provision (the same list as s 558B(1)) and the holding company 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 holding company had taken reasonable steps to prevent such contraventions, judged on the group's size and resources, its ability to influence the subsidiary, steps to ensure the subsidiary understood its obligations, compliance assessment arrangements, complaint handling arrangements across the group, and whether group arrangements encourage or require compliance. Liability does not depend on proceedings against the subsidiary, and a holding company that pays may recover from the subsidiary (s 558C).
Our statement of the clause of Australia Fair Work Act 2009 (Cth), held and verified: cite it as s558B-2. The instrument verbatim is not quoted here; the held framework carries the reading.
The evidence this duty asks you to hold
Group workplace compliance policy applying to every employing subsidiary, approved by the parent board; Group internal audit reports on subsidiary payroll, award coverage, records and pay slips; Group-wide complaints and whistleblower channel log covering underpayment allegations, with outcomes; Parent board or audit committee minutes reviewing subsidiary workplace compliance
What usually goes missing
Subsidiaries running separate payroll systems never tested by the group; Known underpayment issues in one subsidiary not checked in sister entities; Officers of the parent receiving reports of contraventions without a documented response; Acquired businesses not brought into group compliance monitoring
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.