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Single Touch Payroll: Why employers must be extra cautious in the data-sharing world

  • CVCheck By CVCheck
  • July 30, 2019
Being Cautious Of Single Touch Payroll

As of 1 July 2019, Australia’s transition to Single Touch Payroll is complete. But do you know why employers who aren’t vigilant about visa checking could run into serious trouble?

Australia’s transition to Single Touch Payroll (STP) is now complete, with small enterprises of fewer than 20 staff the latest and last batch of businesses to make the switch.

Under the new system, the ATO can keep a much closer eye on what’s happening within your business from pay cycle to pay cycle – and that’s not the only government agency enjoying unprecedented visibility over who’s working where, and how often.

How is your employee data being shared?

Thanks to its data-matching program, the Department of Home Affairs can simply crosscheck the STP information being lodged to the ATO – including name, date of birth, earnings, and hours worked – against the work rights and restrictions of visa holders.

If the system flags someone in breach of their conditions – for example, they’re on a student visa and working more than 40 hours a fortnight – it could result in Fair Work inspectors investigating your business, which can be “pretty nasty”, according to Mark Webster, work rights legislation expert and founder of vSure.

“They actually come in uniform and they have all sorts of powers,” he says. “They can request documents, and of course there’s those big fines for people working in breach of visa conditions as well.”

Employer penalties for breaching visa conditions

There are a number of possible sanctions that can be imposed for employing someone in breach of their visa conditions. These include having your approval to sponsor foreign workers cancelled, being barred from future sponsorships, and civil penalties of up to $63,000 for a corporation and $12,600 for an individual for each failure.

Unfortunately, because of legislation introduced in 2013 that put the onus on employers to check their employees’ visa conditions, ignorance is no longer a defence.

“If somebody’s working in breach of visa conditions, it doesn’t matter if you don’t know, or the employee said ‘I’ve got full work rights’, the mere fact that person is working in breach is enough for the employer to face a fine,” Webster says.    

How to stay on top of your employees’ visa status

For businesses without a legal team, trying to untangle the various types of visas, their expiry dates, and their respective working conditions can be “quite bamboozling” says Webster, so in many instances, employers simply end up taking their employee’s word for it.

“I’m a permanent resident”, for example, could just mean a person has applied for permanent residence, but if they’re on a bridging visa and their application is denied, they may have to leave the country within 35 days.

Alternatively, partner visa applications can be rejected any time before the decision on the applicant’s permanent visa is made.

Visa refusals increased by 46% in 2017-18 and withdrawals by 17%, which illustrates why systematic and regular checks are so important. The good news is it doesn’t have to be difficult.

“Instead of doing all the research yourself, third-party services verify what type of visa someone is on and explain to you the visa conditions in human, readable language,” explains Webster. “And they’re set-and-forget, so if the person’s visa status changes, you’ll get a notification.

“It just means you don’t have to be an immigration expert to figure out whether someone can work for you, and under what conditions.”

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