Reform of the Personal Liability of Directors for Unpaid Employee Entitlements

Centre Member: Helen Anderson

Laws imposing liability on corporate directors must balance responsible governance by directors and the need for appropriate compensation for affected parties with the risk of inhibiting directors' legitimate commercial decision-making. A pressing issue is the extent to which directors should be liable for unpaid employee entitlements, given the ineffectiveness of the relevant Corporations Act provisions and the burden this places on taxpayers. This project will examine other models of liability, which provide greater deterrence and possible compensation, including incentives to place companies into voluntary administration. The objective is to recommend reform and the employee entitlement provisions.