The recently elected Coalition government, with an eye on the Work Choices debacle, which ushered it from power in 2007, has signalled that there will be no wholesale changes to the Fair Work regime. Rather, there will be some fine-tuning and tweaking of the sails to maintain the course (at least at first). That said, there may be some pressure on the Coalition to move on changes to provisions relating to penalty rates and restricting access to the Fair Work Commission for unfair dismissal and general protection claims (which matters were to be the subject of a review by the Productivity Commission).
Business can look forward to the following:
1. Paid Parental Leave
It is not clear at present just how the proposed paid parental leave scheme (“PPL”) will work and just what will be its parameters. The Coalition foreshadowed that the PPL will commence on 1 July 2015 and will provide mothers 26 weeks PPL following the birth of a child at their actual wage (subject to a cap of $150,000.00 p.a.). Given the makeup of the Senate, it would be unlikely that this scheme will contain all the elements proposed by Mr Abbott.
2. Fair Work Review Panel Recommendations
It is likely that the Coalition will implement certain of the Fair Work Review Panel’s recommendations not accepted by the previous Labor government, including:
- Clarifying when the annual leave loading is payable on termination of employment;
- Including “non-monetary” benefits in the range of considerations for the “better off overall” test;
- Requiring the employer and the employee to have discussions relating to a request for extended unpaid parental leave unless the employer has already agreed to the request.
3. Workplace Bullying
The workplace bullying amendments due to take effect on 1 January 2014 will be further amended to:
- Require the employee to first seek help from the relevant State Work Health and Safety Regulator (or similar); and
- Apply to the conduct of union officials both to employees and employers.
4. Individual Flexibility Arrangements
Individual Flexibility Arrangements (“IFAs”) will not be restricted by Enterprise Agreements. IFAs allow for variations to modern awards or enterprise agreements to meet the genuine needs of employers and individual employees, subject to minimum entitlements and protections not being undermined. The test is: The employee must be “better off overall” under the IFA.
5. Greenfields Agreements and Good Faith
“Good faith” will be mandatory in negotiating Greenfields agreements. If such an agreement is not signed off within three months, the Fair Work Commission may approve the proposed agreement, subject to its provisions being consistent with prevailing industry standards.
“Good faith” in this context broadly requires:
- the parties to act honestly;
- each party to have regard to the legitimate interests of the other(s);
- each party to act in a manner which is not arbitrary, capricious or intended to harm the other(s).
That does not preclude a party from seeking the best possible deal in its own interests or (subject to any contract provision) contemporaneously negotiating with another party.
6. Realistic Approach to “Protected Action”
The Fair Work Commission will have to be satisfied that genuine negotiations have taken place and that the claims by both employer and employee interests are “sensible and realistic” before protected action can occur.
Generally, employees can only take protected action after the Fair Work Commission has approved a protected action ballot, while employers can only take protected action in response to employee industrial action.
Participants in “protected industrial action” are protected from civil claims against them, with some exceptions such as claims for injury and wilful or unlawful use or damage to property.
7. Right of Entry
The Labor government’s amendments dealing with right of entry for union officials passed in June 2013 will be reversed by the Coalition and the Fair Work Commission will be given powers to resolve disputes about frequency of workplace visits by a union.
A union’s right of entry to a workplace will not, however, be affected in relation to work health and safety breaches or representing a member in individual disputes.
8. The Australian Building and Construction Commission (“ABCC”)
The Coalition proposes to re-establish the ABCC in place of Fairwork Building & Construction to administer industrial relations maters in that industry. The breadth of powers of the new ABCC remains to be seen.
9. Registered Organisation Commission & Penalties
The Coalition has foreshadowed the establishment of a Registered Organisation Commission and a penalty regime similar to that applying to company directors and officers to ensure compliance with laws regulating unions and employer organizations.
Enabling legislation is scheduled to be introduced in the first sitting week of the new Parliament.
In summary, employers should be vigilant to ensure their activities and workplaces are compliant with the Fair Work Act and other employment-type legislation, such as the Work Health and Safety Act and various antidiscrimination legislation. However, subject to the above, there are not likely to be too many unflagged changes during the course of the next 6 or so months.