Supplement for Creighton & Stewart s Labour Law Fifth Edition. August 2014

Transcription

1 Supplement for Creighton & Stewart s Labour Law Fifth Edition August 2014 About this Supplement This supplement is not intended to provide a comprehensive update of developments since the publication of the Fifth Edition in Besides correcting a few errors, it concentrates on legislative developments and proposals, though a few leading cases are included. The authors are grateful for the assistance of Kim Owers in preparing this update. Errata [6.29], [6.51]: These paragraphs should have made it clear that applications for judicial review against Fair Work Australia (now Fair Work Commission) decisions may be lodged either in the Federal Court or the High Court. Section 39B of the Judiciary Act 1903 (Cth) was amended in 2009 to permit such actions to be initiated in the Federal Court, rather than having to be made to the High Court and then remitted (although that option remains open). [13.96]: The section reference in the fourth last line should be to s 65(4), not s 65(5). [13.119] The section reference in the third last line should be to s 90(1), not s 90(2). [17.27]: The section reference at the end of the paragraph should read: (s 357(2)). [17.65]: The fourth last line should read: addition of protection against victimisation on grounds of non-membership, as well as membership [17.113]: The Listening Devices Act 1972 (SA), referred to in fn 290, should be the Listening and Surveillance Devices Act [20.29]: In fn 31, Queensland and Western Australia should be just Queensland. The list of legislation that follows should include the Conspiracy and Protection of Property Act 1900 (WA) s 5. Bibliography: The following entry was inadvertently omitted: Cooper J (chair) 2010, Super System Review: Final Report (Commonwealth of Australia, Canberra) The Fair Work Review and the 2012 and 2013 Amendments Fulfilling a commitment made when the Fair Work Act 2009 (Cth) (FW Act) was introduced, in late 2011 the Gillard Government commissioned an evidence based review of the legislation from a panel comprising economist John Edwards, academic Ron McCallum and retired judge Michael Moore. The panel s report, entitled Towards More Productive and Equitable Workplaces: An 1

2 Evaluation of the Fair Work Legislation, was released in August 2012: see The Review s principal finding was that the FW Act was operating broadly as intended. There was no evidence to support the widely expressed view by business leaders that the legislation was holding back productivity. Nor had there been any significant increase in industrial disputation. Consistent with this analysis, the report rejected proposals from employer groups for a return to voluntary bargaining, the reintroduction of statutory individual agreements, a relaxation of the better off overall test for agreement-making, or a narrowing of the transfer of business provisions. Nor did it accept that there should be any significant curtailment in the right of employees to complain of unfair dismissal or take industrial action, or the right of union officials to enter workplaces. While rejecting proposals for radical change, the panel did put forward 53 proposals for improving the Fair Work system, many involving amendments to the legislation. Some of these would address technical problems, or (in a few cases) either reverse or confirm contentious interpretations of the Act. For the most part, however, the panel emphasised the need to allow the newer aspects of the Fair Work regime to be fully tested, before rushing to intervene. In October 2012 the government announced that it would implement a limited number of recommendations for which it considered there was broad stakeholder support. These were duly passed in the form of the Fair Work Amendment Act 2012 (2012 Amendment Act), the majority of which was proclaimed to take effect from 1 January A second tranche of reforms was effected by the Fair Work Amendment Act 2013 (2013 Amendment Act), passed in June This Act also included further changes that had not been the subject of attention by the Review, such as the introduction of new provisions on workplace bullying and consultation over changes to working hours. The various changes made by the 2012 and 2013 amendments are considered further below. Strangely, Labor failed to adopt a position on many of the recommendations from its own Review before losing office at the September 2013 federal election. By contrast, the Abbott Government has sought to implement a number of the remaining proposals from the Review. The Coalition s Reform Proposals The Liberal/National Coalition was elected to office in September 2013 on the basis of a promise to make a number of limited (though still important) changes to the existing system of labour regulation, but with a commitment also to establish an inquiry to consider more substantial reforms for the future. As outlined below, the Abbott Government has begun the process of implementing its election policies, introducing a number of Bills into Parliament. With the Senate under the control of Labor and the Greens, it has been unable so far to secure passage of these Bills. As from July 2014, however, the balance of power in the upper house has effectively shifted to a collection of minor parties and independents, with whom the government will now need to try to negotiate to gain approval for its reforms. 2

3 The most significant of the Abbott Government s plans for reform are set out in a document entitled The Coalition s Policy to Improve the Fair Work Laws, released in May 2013 (see This promises to maintain the Fair Work laws, pending a comprehensive and broad inquiry by the Productivity Commission. Any changes that might flow from that inquiry will be taken to a new election. Before then, the only changes to be proposed to the Fair Work legislation will be those expressly set out in the policy. There is also a guarantee that the pay and conditions of workers will be protected. There has been little progress in establishing the inquiry. Media reports suggest that the government is delaying it as long as possible, fearful of a possible public backlash against any suggestion of radical, Work Choices-style reforms. But draft terms of reference for the inquiry leaked in March 2014 confirm that it will have a broad ambit, with a strong focus on fostering competitiveness and reducing the compliance burden for employers. In the meantime, the Fair Work Amendment Bill 2014 (2014 Amendment Bill), tabled in the House of Representatives on 27 February 2014, proposes to implement some, though not all, of the changes to the FW Act flagged in the Coalition s May 2013 policy. This and other measures, including the Building and Construction Industry (Improving Productivity) Bill 2013 and the Fair Work (Registered Organisations) Amendment Bill 2014, are detailed in the sections that follow. A small business policy launched by the Coalition during its 2013 election campaign also speaks of supporting smaller employers in various ways, including by immunising them from penalties for inadvertently breaching workplace laws when following FWO advice. The policy commits the new government to supporting independent contractors and resisting what is described (though without coherent explanation) as Labor s co-ordinated attack on the self-employed. The Abbott Government has also initiated an ALRC inquiry into federal laws that encroach upon traditional rights, freedoms and privileges, for example by reversing a burden of proof, denying procedural fairness, interfering with freedom of speech or association, excluding the privilege against self-incrimination, or authorising the commission of a tort. One of the areas of law singled out for attention is workplace relations. As such, the inquiry can be expected to look at the general protections in the FW Act (see [17.100]), the immunities conferred when taking protected action (see Chapter 23) and certain aspects of the building and construction industry legislation (see Chapter 24), among others. Institutions By virtue of the 2012 Amendment Act, Fair Work Australia (FWA) (see [6.05] [6.37]) was renamed as the Fair Work Commission (FWC), with effect from 1 January A further change was to subsume the FWC s Minimum Wage Panel (see [6.06]) within a new Expert Panel. Besides conducting annual wage reviews, this Panel will help identify default superannuation funds for modern awards. There must be six part-time Panel members in total, allowing for a different range of expertise according to whether the Panel is reviewing wages or selecting superannuation funds. More recently, the Abbott Government has been considering a proposal from certain employer groups to establish an independent appeal jurisdiction for the FWC an idea which appears (though this has not been officially confirmed) to involve the government hand-picking a new set of 3

4 tribunal members to review FWC decisions, in place of the current Full Bench system. At the time of writing it was not clear whether this proposal would proceed, or if so what form it might take. The Road Safety Remuneration Tribunal (RSRT) is a new federal tribunal for the road transport industry that contains a mix of dual-appointed FWC members and part-time industry members. It is empowered by the Road Safety Remuneration Act 2012 to make remuneration orders, approve collective agreements and deal with disputes over unsafe work practices, in relation to both employed and self-employed drivers. In accordance with an election commitment, the Abbott Government has commissioned a review of the operation of the RSRT and the need for the legislation under which it operates. But although a report was received in April 2014, the government has not yet released it or announced a response. The Federal Magistrates Court (see [6.59] [6.60]) has been renamed the Federal Circuit Court of Australia, with its magistrates becoming judges: see Federal Court of Australia Legislation Amendment Act Outworkers The Fair Work Amendment (Textile, Clothing and Footwear Industry) Act 2012 introduced new protections under the FW Act for workers in the clothing industry. In particular, certain outworkers are now deemed to be employees, a code of practice may be issued for their engagement, and they may recover payments from indirectly responsible entities that benefit from their work. The protections are similar to those that already existed under certain State laws (see [8.18]). Foreign Labour A review of the 2007 amendments to the Migration Act 1958 concerning the illegal employment of foreign workers (see [7.70]) concluded that they had been largely ineffective in curbing the growth in such arrangements. Accordingly a new civil penalty regime, based on recommendations from the review, has been implemented: see the Migration Amendment (Reform of Employer Sanctions) Act Affirmative Action and Equal Employment Opportunity In 2012 the Equal Opportunity for Women in the Workplace Act 1999 (see [7.74]) was amended by the Equal Opportunity for Women in the Workplace Amendment Act 2012 and retitled the Workplace Gender Equality Act Reports must still be filed by larger employers with what is now called the Workplace Gender Equality Agency (WGEA). But, commencing in 2014, the focus of that reporting has changed, from process to outcomes. Instead of simply declaring what programs it has instituted to eliminate discrimination against women, an employer must now report on how it is performing against a set of gender equality indicators. These include the gender composition of the employer s workforce and of its governing body (such as a board of directors); the extent to which men and women receive equal remuneration; and the availability and use of conditions or practices designed to support employees with family or caring responsibilities. The government may also 4

5 prescribe minimum standards, which can be either general or industry-specific, and which may stipulate quantitative targets for particular indicators. The prescribed gender equality indicators are detailed in Schedule 1 of the Workplace Gender Equality (Matters in relation to Gender Equality Indicators) Amendment Instrument 2013 (No 1). For the reporting year commencing on 1 April 2015, it will also be necessary to cover the matters set out in Schedule 2. The expanded requirements were originally set to commence a year earlier, but were deferred pending a review: see Workplace Gender Equality (Matters in relation to Gender Equality Indicators) Amendment Instrument 2014 (No 1). The Abbott Government has also issued a fairly basic set of minimum standards under the 2012 Act, to apply from 1 October 2014 to employers with 500 or more employees, and from 1 April 2015 to employers with at least 100 employees: see Workplace Gender Equality (Minimum Standards) Instrument National Employment Standards As recommended by the Fair Work Review, the 2013 Amendment Act has greatly expanded access to the right to request flexible work arrangements (see [13.94] [13.97]) under the National Employment Standards (NES). Under the original s 65 of the FW Act, this was limited to employees who were parents of pre-school or disabled children, and not (for example) those caring for elderly relatives or adults with disabilities. A request may now be made by (among others) any employee who is a carer within the meaning of the Carer Recognition Act 2010 (Cth), who has a disability, who is over 55, or who has experienced family violence. A further recommendation from the Review was that employers should no longer be able to reject requests for flexibility without actually meeting the employee. This has been ignored, although a similar recommendation in relation to requests to extend unpaid parental leave (see [13.101]) has been picked up in the Coalition s 2014 Amendment Bill. Further changes to parental leave are dealt with later under a separate heading. The 2014 Bill also seeks to implement two further recommendations from the Review as to NES entitlements. The first would clarify that any annual leave loading (or other addition to a base rate of pay) to which an employee is otherwise entitled is not payable on termination of employment, unless an applicable modern award or enterprise agreement expressly provides otherwise (see [13.119]). The second is to amend s 130 of the FW Act (see [10.33]) so that an employee cannot take or accrue leave under the NES while absent from work and receiving workers compensation payments, regardless of what the relevant workers compensation law might otherwise provide. The Review also recommended that the process of harmonising State and Territory long service laws (see [13.130]) should be expedited; and that consideration be given to limiting to 11 the number of public holidays for which penalty rates can become payable (see [13.126]). These have not as yet attracted any support from government. 5

6 Modern Awards Item 6 of Schedule 5 to the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 required an interim two-year review of the modern award system. Few major changes were agreed by the FWC during this process, though exceptions included: an increase in the minimum notice period for terminating an IFA (see below, Individual Flexibility Arrangements, which also discusses changes proposed by the 2014 Amendment Bill); an increase in wage rates for apprentices (see below, Minimum Wages); and the scrapping of junior rates for 20-year old retail workers (see Modern Awards Review 2012 General Retail Industry Award 2010 Junior Rates [2014] FWCFB 1846). Attempts by employer groups to reduce overtime or penalty rates were generally unsuccessful, although in Re Restaurant and Catering Association of Victoria [2014] FWCFB 1996 a Full Bench did agree to cut Sunday rates for some casual restaurant workers. The last two decisions mentioned are each being challenged in the Federal Court. Even before the interim review concluded, the first of the regular, four-yearly reviews of modern awards (see [11.88]) had been initiated. The process for undertaking this review has been outlined by the FWC in 4 Yearly Review of Modern Awards [2014] FWCFB 916. In 4 Yearly Review of Modern Awards: Preliminary Jurisdictional Issues [2014] FWCFB 1788 at [23] it was emphasised that while the new review would be broader in scope than its predecessor, anyone seeking a change would need to adduce probative evidence properly directed to demonstrating the facts supporting the proposed variation. Furthermore, the FWC would only depart from previous Full Bench decisions on the content of modern awards if cogent reasons were advanced (at [27]). One matter that the FWC will need to consider carefully during the four-yearly review is an addition to the modern awards objective (see [11.47] [11.49]) made by the 2013 Amendment Act. Section 134(1)(da) of the FW Act now refers to the need to set additional remuneration for work that is overtime, on weekends or public holidays or shiftwork. It remains to be seen what effect, if any, this has on moves to reduce or eliminate penalty rates in certain awards. Prior to these reviews, a number of applications had been brought to vary the modern awards that took effect in January The most significant of these, in terms of the potential to set a precedent across a number of industries, involved an attempt to reduce the minimum period of engagement for casual employees set by the General Retail Industry Award A general application to that effect was rejected by FWA, on the basis that such a change was not necessary to achieve the modern awards objective: see Appeal by National Retail Association Ltd [2010] FWAFB However, a much more limited variation was subsequently granted, allowing students to work 90-minute shifts after school: see SDA v National Retail Association Ltd (No 2) (2012) 205 FCR 227. In another development, FWA decided to create the first modern enterprise award (see [11.26] [11.33]), covering Telstra: see Telstra Corp Ltd v CEPU [2012] FWAFB In doing so, it rejected Telstra s application to terminate its existing enterprise instruments and fall back to the relevant industry awards. The Full Bench agreed with the unions view that if the history and circumstances 6

7 of Telstra did not justify the making of an enterprise award, then nothing ever would. The Full Bench also noted that, unlike the case with previous unsuccessful applications (see eg Yum Restaurants Australia Pty Ltd v Full Bench of FWA (2011) 199 FCR 75), the Telstra awards generally set pay and conditions that were above the industry safety net, not below. Modern awards have also been amended to include a new requirement for employers to consult over changes to working hours, as discussed under a separate heading below. High Income Threshold The high income threshold for which s 333 of the FW Act provides has now risen, as of 1 July 2014, to $133,000. This affects the availability not just of high income guarantees (see [11.61] [11.63]), but of unfair dismissal claims (see [19.40] [19.43]), as well as the cap on compensation for unfair dismissal (see [19.76]). Enterprise Agreements Labor s 2012 Amendment Act made two changes to the system of enterprise agreements under Part 2-4 of the FW Act. An agreement must now cover at least two employees (s 172(6)), while it is also now unlawful to include any provision that allows an employee or employer to elect not to be covered by the agreement (s 194(ba)). In CFMEU v Queensland Bulk Handling Pty Ltd [2012] FWAFB 7551 a Full Bench of FWA had previously held that such opt-out clauses were not consistent with the Act s concept of a collective agreement, though only after a series of inconsistent rulings on the point. The 2013 Amendment Act added a requirement that agreements include a term obliging employers to consult over changes to working hours, as discussed under a separate heading below. The Coalition s May 2013 policy contained a promise to require the FWC, in determining whether to approve a proposed enterprise agreement, to consider the extent to which the parties have considered and discussed ways to improve productivity. This has not yet been implemented. But the 2014 Amendment Bill does include important changes to the system for making greenfields agreements (see [12.28] [12.29]). Echoing the Fair Work Review s concerns about the capacity of trade unions to frustrate the making of such agreements, the Abbott Government has proposed that bargaining orders be available from the FWC to enforce good faith bargaining requirements in relation to greenfields agreements. This is to be done by amending the Act to recognise that the union(s) with whom the employer chooses to negotiate, the employer and anyone it appoints to negotiate on its behalf are to be regarded as bargaining representatives. The Review also recommended that the FWC be empowered to resolve greenfields disputes by arbitration. This has not been adopted. Instead, the Bill would allow an employer to take unilateral action to have its preferred agreement approved by the FWC. This could be done after three months of unsuccessful negotiation with the relevant union(s), commencing from a date that must 7

8 be formally notified in advance to those unions. Once that three-month period elapsed, there would be no scope for bargaining orders to be sought. Besides the usual approval criteria, the FWC would need to be satisfied that the employer s proposed agreement provided for pay and conditions that are consistent with the prevailing pay and conditions within the relevant industry for equivalent work. A note to be inserted into the Act suggests that the FWC may for this purpose have regard to prevailing pay and conditions in the relevant geographical area. In effect, the Bill marks a partial return to the Work Choices regime, under which an employer could at any time choose to make an employer greenfields agreement rather than negotiating with a union. The difference this time is that an employer would at least need to attempt to negotiate a union deal and be exposed to the possibility of bargaining orders (at least before the end of the negotiation period) if it failed to do so in good faith. It should also be noted that if an employer chose to have a greenfields agreement approved in this fashion, the agreement would be taken to have been made by any unions that were bargaining representatives, despite their lack of consent. That in turn means that the resulting agreement would cover those unions an important point in relation to rights of entry to any workplace covered by the agreement, as discussed below. Further changes made or proposed to the regulation of bargaining for an enterprise agreement are dealt with below under the heading of Collective Bargaining. Individual Flexibility Arrangements As noted in [12.51], unions have been effectively negating the use of individual flexibility arrangements (IFAs) under many enterprise agreements, by insisting on negotiating flexibility terms that are narrow in scope. To prevent this, and as recommended by the Fair Work Review, the Abbott Government s 2014 Amendment Bill proposes that agreements should, as a minimum, permit individual employees to negotiate arrangements as to the following matters (if dealt with in the agreement): the times at which work can be performed, overtime or penalty rates, allowances and leave loadings. These are the matters currently stipulated by the model flexibility term in Schedule 2.2 of the Fair Work Regulations 2009, as well as by the standard flexibility term in awards. The Bill also proposes to amend the FW Act s provisions regarding flexibility terms in modern awards (see [11.64] [11.68]) and enterprise agreements (see [12.48] [12.51]) in accordance with other Fair Work Review recommendations. The changes would include lengthening the maximum notice needed to terminate an IFA from 28 days to 90 days. This change had indeed already been agreed to by the FWC for flexibility terms in modern awards: see Modern Awards Review 2012 Award Flexibility [2013] FWCFB The Bill would also make it clear that the better off overall test can be satisfied by providing non-monetary benefits in lieu of monetary entitlements; and allow an employer to defend an action for breaching a flexibility term, by showing that it followed the required procedures and reasonably believed that the requirements for a valid IFA were satisfied. However, there will be no new requirement on employers to report details of any individual flexibility arrangement (IFA) to the Fair Work Ombudsman (FWO), as the Review had also proposed. 8

9 Importantly, the Bill proposes to retain existing safeguards on the use of IFAs. Any IFA must leave each affected employee better off than they would have been under the relevant award or agreement. Indeed the Bill proposes to add a requirement that each IFA contain a statement by the employee explaining why the arrangements meets their genuine needs and leaves them better off. And an employer cannot insist on a job-seeker signing an IFA as a condition of being employed, or exert undue pressure or influence on an existing employee to enter into an IFA. Executive Pay In relation to executive pay (see [13.05]), the Corporations Amendment (Improving Accountability on Director and Executive Remuneration) Act 2011 took effect in July It imposes new rules for the determination and control of remuneration packages for the key management personnel of listed companies. Minimum Wages Part 2-6 of the FW Act provides for annual adjustments to the minimum wages set for national system employees (see [13.09] [13.21]). In its Annual Wage Review [2011] FWAFB 3400, FWA s Minimum Wage Panel granted a 3.4% increase in minimum wages, including those set by modern awards. The following year, it decided on a 2.9% increase: see Annual Wage Review [2012] FWAFB In its Annual Wage Review [2013] FWCFB 4000, the Panel granted a 2.6% increase. This was followed by a 3% increase in the Annual Wage Review [2014] FWCFB 3500, from what is now known as the FWC s Expert Panel. As from July 2014, the national minimum wage is $ per week or $16.87 per hour. In 2011 the Panel also, for the first time, established minimum rates for award-free juniors and trainees. In both cases, it opted to apply the special rates set for those types of worker by the Miscellaneous Award The Panel had originally intended to conduct a broader review in of junior and trainee wage rates in awards, but this was postponed: see Annual Wage Review Juniors and Trainees [2011] FWA 619. In 2013, as part of the interim two-year review of the modern award system, a Full Bench of the FWC granted significant increases to minimum wage rates for apprentices, including by enshrining the principle of higher rates for adult apprentices (those aged 21 or over): see Modern Awards Review 2012 Apprentices, Trainees and Juniors [2013] FWCFB In addition, and as expected (see [13.21]), the Panel has progressively increased the casual loading for award-free employees, so that from July 2014 it now sits at 25%, the same figure as in modern awards. In Western Australia, the Industrial Relations Commission has increased the State minimum wage (see [13.22]) to $ per week or $17.52 per hour: see State Wage Order [2014] WAIRC Pay Equity Under Part 2-7 of the FW Act, FWA can make an order to ensure equal remuneration for men and women workers for work of equal or comparable value : see [13.30] [13.33]. The first such order 9

10 has now been made, in a case brought by the ASU in respect of the female-dominated social and community services (SACS) sector. In a preliminary ruling, the Full Bench was satisfied that gender had been important in creating the gap between pay in the SACS industry and pay in comparable state and local government employment : Equal Remuneration Case [2011] FWAFB 2700 at [291]. It refused, however, to articulate any equal remuneration principle to guide future decisions. In February 2012, a majority of the Bench accepted a joint ASU-Commonwealth submission that this gap should be remedied by increases of between 19 and 41% to the minimum wage rates set by the Social, Community, Home Care and Disability Services Industry Award 2010: see Equal Remuneration Case [2012] FWAFB The Award itself has not been varied, and the equal remuneration order is to operate on a stand alone basis. There is also a special 4% loading, to recognise impediments to bargaining in the industry. Both the increases and the loading are being phased in over an eightyear period that commenced in December 2012: see Equal Remuneration Case [2012] FWAFB Superannuation In Roy Morgan Research Pty Ltd v Commissioner of Taxation [2011] HCA 35 the High Court rejected a challenge to the constitutional validity of the superannuation guarantee (SG) legislation (see [13.66] [13.69]), holding that it was validly enacted pursuant to the taxation power in s 51(2) of the Constitution (see [4.27]). Labor s promised increase to SG contributions (see [13.66]) was legislated by the Superannuation Guarantee (Administration) Amendment Act 2012, which took effect in July It provides for minimum contributions by employers to rise in progressive increments, from 9% of ordinary time earnings to 12%, with the latter figure to apply from July The same measure removed the previous exemption for employees aged over 70. Since coming to office, the Abbott Government has been endeavouring to delay the planned increases in employer contributions. Its initial attempt to do this, as part of the Minerals Resource Rent Tax Repeal and Other Measures Bill 2013, was blocked in the Senate. Hence the rate has now increased to 9.5% from 1 July 2014, as originally scheduled. In the 2014 Budget, the government announced that it would move further amendments to hold the 9.5% rate until 30 June The percentage would then increase by 0.5% per year until reaching 12% in With what is now the Minerals Resource Rent Tax Repeal and Other Measures Bill 2013 [No 2] currently the subject of a deadlock between the two Houses of Parliament, it is unclear what (if any) adjustments to the SG percentage will emerge. A further reform concerns the process for identifying default funds in modern awards. These are the funds to which an employer must pay SG contributions on behalf of award-covered employees who have not chosen a fund of their own. Following a Productivity Commission report (Default Superannuation Funds in Modern Awards, Report No 60, 2012), the 2012 Amendment Act added a new Division 4A to Part 2-3 of the FW Act. This requires the FWC to review default fund terms in modern awards every four years, starting in In the first instance, the FWC s Expert Panel is required to prepare a list of funds that meet certain criteria for inclusion. Funds can apply to be 10

11 recognised for this purpose. A Full Bench must then specify at least two funds from that list in each award. Besides its changes to the SG scheme, the Gillard Government also introduced other important reforms to the regulation of superannuation. Some of the key measures were as follows: The Superannuation Legislation Amendment (Stronger Super) Act 2012 amended the Superannuation Industry (Supervision) Act 1993 to require compliance with new data and payment standards for the making of contributions and other superannuation-related transactions. Implementation is being slowly phased in, with large to medium employers (those with 20 or more employees) expected to transition to the SuperStream system by July 2015, and smaller employers by July The Tax and Superannuation Laws Amendment (2012 Measures No 1) Act 2012 amended the Superannuation Industry (Supervision) Act 1993 to require employers to provide greater information on payslips as to superannuation contributions made on behalf of their employees. The new regime was originally intended to commence in July 2013, but has twice now been postponed. The Superannuation Legislation Amendment (MySuper Core Provisions) Act 2012 requires the establishment of low-cost MySuper products (see [13.71]). Where an employee fails to choose a fund, any SG contributions will need to be made to a default fund that offers a MySuper product. The Tax Laws Amendment (2012 Measures No 2) Act 2012 has extended the director penalty regime in Schedule 1 to the Taxation Administration Act 1953 so that it applies to SG amounts. This means that if a company fails to make its required superannuation contributions, the amounts in question can be recovered from any directors who have not taken reasonable steps to ensure compliance, unless they were too ill to participate in the management of the company, or the company itself had acted reasonably in attempting to comply with the SG legislation. Consultation over Changes to Working Hours From 1 January 2014, as a result of changes made by the 2013 Amendment Act, all modern awards and all new enterprise agreements are required to impose an obligation on employers to consult with employees and their representatives over any change to their regular roster or ordinary hours of work (FW Act ss 145A, 205). Modern awards have now been varied to include a standard term to this effect, formulated by the FWC in Consultation Clause in Modern Awards [2013] FWCFB This term is similar, but not identical, to the revised model consultation term for enterprise agreements (see [12.52]) that appears in Schedule 2.3 of the Fair Work Regulations For example, the award term makes it clear that the requirement to consult does not apply where an employee has irregular, sporadic or unpredictable working hours ; though this is arguably also true, by implication, in relation to agreement-covered employees. What both standard terms make explicit is that consultation must occur before any proposed change is implemented. 11

12 Parental Leave The unpaid parental leave provisions in Division 5 of Part 2-2 of the FW Act (see [13.101] [13.104]) have been the subject of a number of amendments, by the Paid Parental Leave and Other Legislation Amendment (Dad and Partner Pay and Other Measures) Act 2012 and the 2013 Amendment Act. The changes include: allowing employees to return to work for keeping in touch purposes without breaking their leave, reflecting similar provisions in the Paid Parental Leave Act 2010 (PPL Act) (see [13.109]); permitting a pregnant employee to start parental leave more than six weeks before the expected date of birth, with the consent of her employer; giving employees the right to transfer to a safe job during pregnancy even if they do not have 12 months service and thus do not otherwise qualify for leave under the NES; permitting partners who are both employees to take up to eight weeks concurrent leave (up from three weeks), and no longer restricting such leave to the period immediately following the birth or placement; providing that any special maternity leave taken is no longer deducted from the employee s overall entitlement to parental leave; and inserting a note in s 65 to confirm (although it was already clear enough) that an employee returning from maternity may request a shift to part-time work to accommodate their caring responsibilities. In addition, as noted earlier, the 2014 Amendment Bill proposes that employers should not be able to reject a request to extend a period of leave without meeting the employee. Turning to the PPL Act (see [13.109]), the Family Assistance and Other Legislation Amendment Act 2011 has had the effect of freezing the salary limit for claiming parental leave pay at $150,000. More significantly, the Paid Parental Leave and Other Legislation Amendment (Dad and Partner Pay and Other Measures) Act 2012 has amended the PPL Act to permit secondary or joint carers to claim two weeks pay at the minimum wage, for births or adoptions occurring after 1 January As with parental leave pay, the dad and partner pay entitlement is funded by the government, although in this case employers are not expected to act as paymasters. Claimants must satisfy similar work and income tests as for parental leave pay. A payment can only be claimed for a period during the first year after the birth or adoption, and the claimant must not be at work at the time, nor be on paid leave from their employment. This means that to obtain the entitlement, an employee who has not left their job will need to take a period of unpaid leave. They can, however, choose to combine such leave with any paid leave available to them (such as annual leave, or paid paternity leave under an employer-funded scheme), provided those periods of leave are taken at different times. A further change proposed in the Coalition s Paid Parental Leave Amendment Bill 2014 is that the Family Assistance Office take over all responsibility for administering parental leave payments, even 12

13 for long-term employees, unless both an employer and employee agree otherwise. The Bill is yet to be considered by the Senate. Despite considerable opposition, both internally and from the business community, the Abbott Government has repeatedly reaffirmed its promise to amend the PPL Act to establish a more generous scheme. While full details are still lacking, it appears that the new scheme, to be introduced from 1 July 2015, would involve: payment of up to 26 weeks pay for mothers at the higher of their actual wage and the national minimum wage, capped at $50,000, plus superannuation contributions; a capacity for fathers to take two of those 26 weeks to assist with care, or the whole 26 weeks if they are the primary carer, but with any payments to them capped by the mother s wage; eligibility as per the current PPL Act, except for the removal of the $150,000 annual income threshold; and funding of the scheme through a 1.5% levy on companies with a taxable income in excess of $5 million per year. Among the many uncertainties about this regime are how it is to apply to adoptions or same sex couples, and the extent to which the government may seek to override existing or future employerfunded schemes to prevent double-dipping. Work Health and Safety As predicted, the adoption of the model Work Health and Safety legislation (see [15.17], [15.31] [15.38]) has been anything but uniform. Only the Commonwealth, New South Wales, Queensland, the ACT and the Northern Territory adopted the legislation by the original deadline of 1 January In each of those jurisdictions, there is now a Work Health and Safety Act 2011, backed by the Work Health and Safety Regulation(s) 2011 except the Northern Territory, which has the Work Health and Safety (National Uniform Legislation) Act and Regulations. Even in these jurisdictions, there are significant departures from the Model Act. For example, in New South Wales unions have retained the capacity to initiate prosecutions, at least in certain cases, even though the Review Panel had expressly recommended that they should not be able to do so (see [15.67]). Of the other jurisdictions, Tasmania and South Australia belatedly passed a Work Health and Safety Act 2012, to commence on 1 January The Western Australian government has continued to express opposition to various aspects of the Model Act, while indicating that it may be prepared to pass a modified version. The Coalition Government in Victoria has indicated that it is not prepared to adopt the Model Act, ostensibly because of the cost implications of implementing the new regime. This is somewhat ironic in light of the fact that the Model Act is substantially based on the legislation in that State. 13

14 Workplace Bullying The FWC may now deal with complaints of bullying, under a new Pt 6-4B of the FW Act that was introduced by the 2013 Amendment Act and took effect on 1 January Bullying is defined in s 789FD(1) to mean repeated and unreasonable behaviour, directed towards a worker or a group of workers, that creates a risk to health and safety. A complaint may be made by any worker, as defined in the Work Health and Safety Act 2011 (Cth). This would include not just an employee but, for example, a contractor or a volunteer (see [15.39]). But the complaint may only relate to work in a constitutionally covered business. This is defined in s 789FD(3) of the FW Act to cover a person conducting a business or undertaking who is a constitutional corporation (see [5.11] [5.19]), a Commonwealth authority, incorporated in a Territory, or operating in a Territory or a Commonwealth place. Hence not all national system employers are covered by the new provisions: see eg Re McInnes [2014] FWC Section 789FF(1) makes it clear that the FWC may only make an order to prevent further bullying, and monetary awards are specifically forbidden. This means that no claim can be maintained by an applicant who is no longer working at the relevant business: see eg Shaw v ANZ Banking Group Ltd [2014] FWC But if there is still a risk that bullying may occur, the FWC may have regard to behaviour prior to Pt 6-4B taking effect: McInnes v Peninsula Support Services Inc [2014] FWCFB Details of how the FWC is dealing with its new jurisdiction can be found at In the first three months 151 applications were lodged (considerably less than expected) and only one order was made, concerning bullying by a co-worker: see Applicant v Respondent (FWC, PR548852, 21/3/14). The great majority of claims have concerned alleged bullying by managers. These have often been met with the s 789FD(2) defence of reasonable management action carried out in a reasonable manner : see eg Applicant v General Manager and Company C [2014] FWC While the Coalition supported the introduction of the new laws, it has signalled an intention to amend them so that complainants must first seek help from an independent regulatory agency, and that the provisions expressly apply to bullying by union officials. Comcare Licences In December 2013 the Abbott Government lifted the moratorium imposed by the previous Labor government (see [15.24], [15.136]) on applications from eligible private sector employers to join Comcare, the federal workers compensation scheme established under the Safety, Rehabilitation and Compensation Act Section 12 of the Work Health and Safety Act 2011 (Cth) has the effect that for any private sector employers who held Comcare licences at the end of 2011, the federal statute will continue to apply to the exclusion of State or Territory work health and safety laws at least for a transitional period. In the absence of any regulation to end that period, those employers need only comply with the federal statute. But this would not be the case for any new licences granted after the ending of the 14

15 moratorium. In the absence of further legislation, it would seem that such licensees would remain covered by State or Territory laws. Civil Penalties The value of a penalty unit, which is set by s 4AA of the Crimes Act 1914 (see [16.31]), has been increased (for offences committed after 28 December 2012) from $110 to $170. For breaches of the FW Act which attract fines of up to 60 penalty units, this means that the maximum penalty is now $51,000 for a corporation and $10,200 for an individual. Recovery of Employee Entitlements The Fair Entitlements Guarantee Act 2012 (FEG Act) was introduced by the Gillard Government to put the General Employee Entitlements and Redundancy Scheme (see [16.62] [16.64]) on a statutory footing. The FEG Act applies to insolvencies occurring on or after 5 December 2012 and permits eligible employees to lodge a claim with the Department of Employment for an advance against unpaid entitlements. A claim can cover up to three months unpaid wages, together with annual and long service leave entitlements. A claim can also be made for up to five weeks pay in lieu of notice and unpaid redundancy pay for up to four weeks per year of service. A maximum weekly wage is used to calculate payments, currently set at $2451. Where an advance is made, the Commonwealth takes over the claimant s priority in relation to any assets of the employer that eventually become available for distribution. The Abbott Government announced in its 2014 Budget that it would seek to cap recovery of redundancy payments at the NES maximum of 16 weeks pay, and to freeze indexation of the maximum weekly wage until July The latter change has been effected by the Fair Entitlements Guarantee (Indexation of Maximum Weekly Wage) Amendment Regulation 2014, subject to disallowance by the Senate. A further measure that has some bearing on the recovery of employee entitlements is the Corporations Amendment (Phoenixing and Other Measures) Act This empowers the Australian Securities and Investments Commission (ASIC) to put a company into liquidation where it has effectively been abandoned by its directors. This is intended to facilitate the recovery through what is now the FEG Act of any unpaid entitlements for the company s employees. It will also allow the liquidator to investigate any unlawful phoenixing activity. This term refers to directors who allow one company to go under, owing money to workers and other creditors, and then create a new one (a phoenix company ) out of the ashes of the first. The same phenomenon was addressed in a report prepared for the FWO, which recommended a range of regulatory responses to address the issue: see PwC, Phoenix Activity: Sizing the Problem and Matching Solutions, June Anti-Discrimination Laws The Sex and Age Discrimination Legislation Amendment Act 2011, among other things, amended the Sex Discrimination Act 1984 (see [17.35]) to create a separate prohibition for discrimination on the 15

16 ground of breastfeeding; to broaden protection against discrimination on the ground of family responsibilities, beyond just situations involving dismissal; and to broaden the definition of sexual harassment. In November 2012, the Gillard Government released for public consultation an exposure draft of a Human Rights and Anti-Discrimination Bill to consolidate all existing federal anti-discrimination laws (see [17.35] [17.39]), other than s 351 of the FW Act, into a single statute. Among other changes, the Bill proposed an expansion of the protected attributes (that is, the grounds on which a person may not be discriminated against) to include sexual orientation, gender identity, immigrant status, political opinion, religion and industrial history. This last term would have included involvement or non-involvement in a trade union. In March 2013 the draft Bill was withdrawn, following criticism of its drafting from a Senate Committee. It did not resurface before that year s election and the Abbott Government has given no indication that it will seek to revive the proposal. There was, however, one set of changes that were taken from the draft Bill and given effect through the Sex Discrimination Amendment (Sexual Orientation, Gender Identity and Intersex Status) Act This has amended the Sex Discrimination Act 1984 to prohibit discrimination on the basis of the three attributes in question. General Protections For the purpose of the general protections in Part 3-1 of the FW Act, s 361 casts on the defendant the burden of proving that any adverse action they may have taken was not for a prohibited reason (see [17.98] [17.100]). In Board of Bendigo Regional Institute of TAFE v Barclay [2012] HCA 32, an employer had taken disciplinary action against a senior employee, a union delegate, for sending out an that suggested corrupt behaviour by management. In response to an allegation that this breached s 346 (which prohibits victimisation for engaging in industrial activities ), the employer argued that the employee had been disciplined for failing to comply with his employment obligations in the way in which he dealt with the matter, not because of his status or activities as a union official. This defence was rejected by a majority of the Full Federal Court, which held that it was not enough that the relevant managers believed they had acted for such a reason. If, objectively, the real reason for adverse action lay in something lawfully done by the employee in his capacity as a union delegate, that was sufficient to contravene s 346, regardless of any subjective belief. On further appeal, however, the High Court restored the trial judge s finding that there had been no breach of s 346. The court emphasised that it was a question of fact as to why the relevant action was taken, and the inquiry was not to be approached on an objective basis. If direct testimony from the relevant decision-maker that they did not act for a prohibited reason was accepted as reliable, that would discharge the burden of proof imposed by s 361. Nor was the employee to be considered immune from any disciplinary action, merely because the act complained of occurred in the course of his union activities. A further High Court decision being awaited is an appeal from BHP Coal Pty Ltd v CFMEU (2013) 219 FCR 245, in which it was held that a union member could be sacked for waving a scab sign while taking protected industrial action. The case is likely to turn on the High Court s interpretation of its earlier ruling in Barclay. 16

17 Two important changes have been made to the process for bringing a dismissal-related general protections claim (see [17.102] [17.104]). The first, made by the 2012 Amendment Act, reduced the period for applying to the FWC from 60 days after the dismissal to 21 days, the same as the new time limit for unfair dismissal claims (see below). Hence dismissed employees and their representatives cannot now pursue an adverse action claim in the event that they miss the unfair dismissal time limit. It is also far harder to lodge an unfair dismissal claim, wait to see how it goes, then discontinue it and pursue a general protections application instead. For dismissals occurring after 1 January 2014, a further change was introduced by the 2013 Amendment Act. Where both parties consent, the FWC may arbitrate a dismissal-related general protections claim that has not been resolved by conciliation: see FW Act ss , A, as amended. Where a claim succeeds, the FWC may order reinstatement or compensation, but it may not impose a penalty. By virtue of the multiple remedy provisions in ss , an agreement to submit a dismissal dispute to arbitration has the effect of precluding any court action in relation to the matter. The same option has been made available for unlawful termination claims (see [19.80] [19.81]). Privacy The Privacy Amendment (Enhancing Privacy Protection) Act 2012 represented what was described at the time as the first stage of the Labor Government s response to recommendations from the Australian Law Reform Commission (ALRC) to amend the Privacy Act 1988 (see [17.111] [17.112]). Among other changes, it has (with effect from March 2014) created a single set of Australian Privacy Principles that apply both to the public and private sectors, and enhanced powers for the Privacy Commissioner and the courts to deal with breaches. As for the Commission s remaining recommendations, including the extension of the 1988 Act to cover smaller businesses and the abolition of the employee records exemption, there is nothing at present to suggest that they will be implemented. Before leaving office, the Labor Government did commission the ALRC to conduct a further inquiry into the idea of a creating a statutory cause of action for serious invasions of privacy, with a focus on the threats to privacy posed by the rapid growth in capabilities and use of information, surveillance and communication technologies : see ALRC, Serious Invasions of Privacy in the Digital Era, Discussion Paper No 80, March How the Abbott Government reacts to any new recommendations remains to be seen. Protection for Whistleblowers Section 16 of the Public Service Act 1999 (Cth) (see [17.108]) has been repealed and replaced with a more detailed regime for protecting federal public sector whistleblowers, under the Public Interest Disclosure Act Among other things, the new legislation makes it clear that the right to disclose wrongdoing or maladministration is a workplace right, so that reprisals may not be taken against a whistleblower without breaching the general protections in Part 3-1 of the FW Act. 17