The Queensland Office of Fair Trading has introduced changes relating to dispute resolution procedures and remuneration disclosure requirements for Incorporated Associations, effective from 1 July 2024.
Dispute Resolution Procedures
Pursuant to recent amendments to the Associations Incorporation Act 1981 (Qld), Incorporated Associations are now required to implement and follow the new model rules’ grievance procedure or adopt another compliant procedure into their governing rules. This change has been introduced to ensure that Incorporated Associations have a formal process to handle internal conflicts and reduce the need for members to seek legal recourse in applying to the Supreme Court.
Action steps required for Incorporated Associations
The model rules’ grievance procedure will automatically apply to any Incorporated Associations who follow the model rules – no constitutional change is required. An overview of the procedure can be accessed here.
Incorporated Associations who already have their own grievance procedure or otherwise wish to adopt a custom procedure must ensure that the procedure complies with section 47A of the Associations Incorporations Act 1981 (Qld). This provision requires that grievance procedures must:
- allow a member to appoint any person to act on their behalf;
- give each party an opportunity to be heard;
- allow unbiased mediation if the dispute cannot initially be resolved; and
- ensure a decision-maker is unbiased if the grievance procedure allows a person to decide the outcome of the dispute.
Any current grievance procedures that do not comply with section 47A will be invalid. In this case, Incorporated Associations will be required to follow the model rules’ grievance procedure, until a valid procedure is adopted.
We note that outlining a grievance procedure in internal policy documents rather than in the governing rules of an Incorporated Association will be insufficient for the purpose of section 47A of the Act, and will arguably cause the grievance procedure outlined in the model rules to apply to the association. As such, Incorporated Associations which currently outline a grievance procedure in policy documents should seek to amend their rules to ensure their preferred procedure continues to apply (subject of course to the requirements of the Act.
Remuneration Disclosure
Incorporated Associations are now required to disclose remuneration and other benefits received by management committee members, senior staff and their relatives at their annual general meeting (AGM). This change has been introduced to promote grater transparency and accountability within Incorporated Associations.
Remuneration and benefits may be disclosed as a total figure given to all persons, so long as the number of persons who have benefited is reported. Reporting is required even where the amount to report is zero.
It is important to note that Incorporated Associations registered with the Australian Charities and Not-for-profits Commission (ACNC) who are exempt from submitting annual financial reports to the Office of Fair Trading are not exempt from this requirement.
For the purpose of the reporting requirements, remuneration includes salary, allowances and other entitlements (eg. free coaching sessions, waived membership fees, or discounted purchases at the association’s club). The meaning of “benefit” is undefined by the relevant legislation, but guidance issued by the Office of Fair Trading suggests that “benefit” will be interpreted as all forms of compensation paid or provided by the Incorporated Association (which is not remuneration) in exchange for services. Examples include:
- Paid leave entitlements;
- Termination benefits;
Non-monetary benefits such as medical care, housing, care and free or subsidised goods and services.
Our team of not-for-profit lawyers are experienced in providing advice to incorporated associations. If your association is looking for advice, please contact us today on 1300 862 529.
This article was written by Sarah Gates & Jessica Lipsett.
