Current Australian directors will now be given 12 months to apply to receive their unique director identification number before fines of over $1.1 million kick in for non-compliance.
Existing company directors will now be required to apply for a director identification number (director ID) by the 30th November 2022. Directors of Indigenous corporations that are governed by the Corporations (Aboriginal and Torres Strait Islander) Act 2006 (CATSI Act) are obliged to apply for the unique identifier by 30th November 2023.
The deadline was originally suggested by Federal Treasurer Joshua Frydenberg earlier this year and has now been confirmed in a legislative instrument made in late September by Senator Jane Hume the Minister for Superannuation, Financial Services and the Digital Economy.
Applications for a director ID are free and will open in November 2021 on the newly established Australian Business Registry Services (ABRS), a single platform administered by the Commissioner of Taxation that brings together ASIC’s 31 business registers and the Australian Business Register.
Directors will be required to apply for their director ID themselves. They will also be required to produce their myGovID alongside two identity documents from a list including their bank account details, super account details, ATO notice of assessment, dividend statement, Centrelink payment summary, and PAYG payment summary.
Although existing directors will have a year to apply for their director ID, new directors appointed between 1st November 2021 and 4th April 2022 will have just 28 days after appointment to apply for their director ID.
New directors who are appointed from 5th April 2022 will be required to apply for their director ID before appointment.
Under the law, directors who fail to apply for a director ID within the stipulated time frame can face criminal or civil penalties of 5,000 penalty units, which currently stands at $1.11 million. Directors of a CATSI organisation can face penalties of up to $200,000.
Penalties will also apply for conduct that undermines the new requirements, including providing false identity information to the registrar or intentionally applying for multiple director IDs.
The legislation passed through Parliament in June 2020, is projected to cover over 2.5 million directors, or approximately 10 percent of Australia’s 25.7 million population.
The director ID will be attached to a director permanently, even if they cease to be a director, change their name, or move interstate or overseas.
The government expects the director ID regime to help prevent illegal phoenixing by ensuring directors can be traced across companies, while also preventing the use of false or fictitious identities.
Australian Government Introduces New Casual Employment Laws
The Australian Government has announced that businesses who have long-term casual staff might soon be hit with fines exceeding $66,000, if they don’t offer them permanent positions.
Since Monday 27th September, employers across the country must begin contacting casual staff who have been employed for at least 12 months, with a written offer to convert them to permanent employment.
The new rules coincide with the changes made to the Fair Work Act which passed through parliament in March 2021. These reforms gave casual employees the right to convert to permanent employment after 12 months of employment, if they have had a regular pattern of hours on an ongoing basis over the past six months.
The definition of small-business employers is businesses who have less than 15 employees at any given time. Under the new rules, small businesses are not required to offer their casual employees an opportunity to convert to permanent employment.
Employers will also not be required to make an offer if there are “reasonable grounds” not to do so. According to the Fair Work Ombudsman, reasonable grounds include when the position of employment is being made redundant, or when the employer would have to make a significant change to the employee’s work hours to make it possible for them to be employed full-time or part-time.
The newly introduced laws mean that businesses are required to write to an employee within 21 days after the employee’s 12-month anniversary to inform them of the casual conversion offer, or reasons why they are not making the offer.
For an employee to accept the offer, the employee is required to respond in writing within 21 days after they receive the offer. If the employee doesn’t respond within the 21-day timeframe, employers can assume that they’ve declined the offer.
Casual employees are also able to request to be converted to permanent employment as long as they have been employed for at least 12 months, have worked a regular pattern of hours over the last six months, and can continue to work these hours in a full-time or part-time capacity.
The Fair Work Ombudsman has outlined that employers cannot reduce or change an employee’s hours of work, or terminate their employment, to avoid having to offer or accept a request for casual conversion.
The new casual conversion entitlement is also now part of the National Employment Standards, meaning companies that fail to make an offer could face penalties in excess of $66,000, while individuals could face $13,000 in penalties.
Casual employees who are unfairly denied an opportunity to convert to permanent employment will also be able to refer their dispute to the Fair Work Commission or seek help from the Federal Circuit Court.
The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 1300 1 VAULT (1300 182 858)
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