The Fair Work Ombudsman (FWO) has officially launched an inquiry into compliance with workplace laws in the disability support services sector. For organisations registered under the NDIS framework, this development represents a significant shift in regulatory scrutiny, one that requires immediate attention to ensure compliance and risk mitigation. Organisations providing supported employment services are not exempt.
Why This Inquiry Matters
Between January 2020 and December 2024, the FWO received:
- 75,000+ enquiries from participants in the sector,
- 2,500+ anonymous reports, and
- Completed over 3,000 matters through investigations and proactive activities.
These actions led to $68 million in back-payments to workers. According to FWO, this pattern of widespread non-compliance justifies deeper regulatory intervention.
Fair Work Ombudsman Anna Booth has made it clear that compliance with workplace entitlements is a priority area, citing serious concerns about systemic underpayments and employment law breaches.
The Scope of the Inquiry
The Inquiry will run in phases over the next 18 months. Its first stage will:
- Engage with workers, managers, directors, digital platform providers, and clients,
- Assess whether minimum entitlements (wages, conditions, leave, penalty rates, casual loading, overtime) are being met, and
- Identify the drivers of non-compliance to guide future enforcement and reform.
Issues flagged by the FWO include:
- High reliance on migrant workers, who are more vulnerable to exploitation,
- Casualisation of the workforce and rapid staff turnover,
- Tight profit margins and pressures on financial viability,
- Increased use of digital gig platforms, and
- A high volume of small or unregistered providers in the market.
Risks for NDIS Employers and Providers
Disability support service providers face heightened legal exposure during this Inquiry, with risks including:
- Wage underpayment claims which may be substantial if systemic errors exist,
- Regulatory enforcement actions for breaches of the Fair Work Act 2009 (Cth),
- Public scrutiny and reputational damage, especially if named in FWO findings,
- Potential flow-on issues with NDIS Quality and Safeguards Commission compliance and funding eligibility.
Providers relying on casual and migrant workforces should expect close monitoring, as the FWO has confirmed these groups are a compliance priority.
Practical Steps Employers Should Take Now
Disability support service providers who take early steps to review and remediate compliance issues will be best placed to withstand scrutiny, protect their reputation, and avoid significant financial exposure.
We recommend undertaking internal audits and seeking legal advice on:
- Award interpretation,
- Correct worker classification,
- Record-keeping obligations, and
- Strategies for responding to FWO inquiries.
Further Information
If you have any inquires, please feel free to contact Maguire Legal here