FRANCHISE BASICS
HOW DOES HR FIT INTO A FRANCHISE? HR issues are part and parcel of a business. In a franchise, HR support comes in the package.
JENNA PAULIN Now Actually
H
uman Resources (HR) is generally not a function in business that owners want to deal with. Unfortunately, reality is, as a business owner managing the complexities of the employment framework under the Fair Work Act it is a requirement of employing staff. When it comes to HR in a franchise system the question of who is responsible for HR becomes uncertain with multiple opinions on the law. Is it the franchisor or the franchisee? One thing that can be agreed on is, there is an argument the function of HR is the responsibility of both the franchisor and franchisee. The boundary on where the liability sits is when the question becomes ambiguous. Depending on who you speak to a different answer may be provided. As a franchisee, you are the director in your own right and
employing staff comes with responsibilities under the Fair Work Act. Although as a franchisor there are also responsibilities under the Protecting Vulnerable Workers Act, that if a franchisor knew or could reasonably have known about a contravention of underpayment by one of their franchisees and failed to take reasonable steps to prevent this contravention the responsibility also applies to the franchisor’s entity along with the franchisee’s entity for underpayment. So why should HR be involved in a franchise system? • To play a role of an educator – upskilling and sharing knowledge with franchisees on obligations under the Fair Work Act. • Provide advice on Award interpretation – with 122 Modern Awards no one is an expert. How a certain award applies for the specific industry or job a franchisee operates under is what must be understood. What clauses impact the franchisees and most importantly the
MAY/JULY 2021 | 62 | WWW.FRANCHISEBUSINESS.COM.AU
