Fair Work Bill 2008 to replace the Workplace Relations Act 1996

Author: Tony Cardillo

Publish Date: December 1, 2008

The Bill, in the current form has some 575 sections on 613 pages.

In summary, the Bills main features are:

National Employment Standards (Safety Net), covering the following:

Maximum ordinary hours of work per week;
A right to negotiate flexible working arrangements;
Parental leave, annual leave, personal/carer’s/compassionate leave;
Community service leave;
Long service leave;
Public holidays;
Notice of Termination and redundancy;
Provision of a fair work written information statement to new employees.

Modern Awards

The Australian Industrial Relations Commission will continue preparing “modern awards” applicable to the major industries. In addition to the ten previously allowable WorkChoices provision, the modern awards must develop provisions to provide for dispute resolution, award flexibility, set out the ordinary hours of work, provide for five weeks annual leave for shift workers and terms to allow for the automatic variation of allowances. These terms are expected to be tailored to meet the requirements of the particular industry or occupation. The awards will not cover employees earning more than $100,000.00 a year.

The Establishment of Fair Work Australia (FWA), a Statutory Independent Body responsible for ensuring:

Collective bargaining;
Adjustment of minimum wages and award conditions;
Dealing with unfair dismissal claims, industrial action and settling workplace disputes.

The Fair Work Ombudsman

His/her function’s include promoting and monitoring compliance with the Act, and providing education, assistance and advice to employees, employers and organisations.

Enterprise Agreement

Enterprise Agreements will cover all Workplace Agreements whether negotiated through a Union or otherwise. Employees and employers may appoint a person or persons of its or their choice to negotiate an Enterprise Agreement. Fair Work Australia (FWA) is to facilitate “good faith bargaining” and the making of agreements. It can make “bargaining orders” and deal with disputes. FWA must also ensure that employees covered by an Enterprise Agreement are “better off overall” against the new safety net.

The parties may negotiate terms which were previously prohibited under WorkChoices such as deductions from salary for any purpose authorised by the employee covered by the Award, and matters pertaining to the relationship between employer(s) and the employee organisation(s). Terms attempting to contract outside the provision of the Fair Work Bill are deemed unlawful.

Unfair Dismissal

The Bill grants a right to all employees to bring claims for unfair dismissal. Employees of small businesses (businesses with less than 15 employees) can also bring unfair dismissal claims, subject to restrictions. The legislation introduces the small business Fair Dismissal Code (the Code). The Code specifies the steps that a small business must follow to ensure that a termination is fair. The Code only applies to small businesses.

An employee of a small business may make a claim for unfair dismissal provided:

He/she has worked for the employer for at least twelve months or more;
Lodges his unfair dismissal claim within seven days of the notice of termination;
He/she has not been dismissed for a genuine redundancy reason.

Under the Code a small business employer may establish that the dismissal of the employee was fair if it:

Establishes “reasonable grounds” for summary (instant) dismissal for serious misconduct, for example, stealing, acts of violence, etc;
Establishes that the employee was underperforming. The employer must first give the employee a warning and a reasonable opportunity to improve performance;
Establishes that it has complied with the Code.

On the lodgement of a claim for unfair dismissal FWA must investigate the claim and facilitate discussions between the parties with a view to the parties reaching a settlement. If the parties cannot reach agreement, FWA may make a decision without a formal hearing. A successful employee may be reinstated; if that is not appropriate, compensation amounting to a maximum of six months wages may be awarded. The parties may not be legally represented unless with leave of FWA in cases involving complex issues.

Industrial Action

During negotiation for an Enterprise Agreement, protected Industrial action (that is a strike, work to rule, bans, limitations etc., allowable under the Bill, subject to conditions in limited circumstances, eg., when an employer refuses to engage in negotiations for an agreement) (is available only during the negotiations. Such action is limited to circumstances where:

The parties are genuinely trying to reach agreement and have acted in good faith and have complied with any fair bargaining orders;
The protected industrial action is authorised by the members on a secret ballot.

Protection action is only allowable for a maximum of thirty days from the date of the ballot unless extended by FWA.

An employer may lock out employees but will only be protected where an employer locks out employees taking protected industrial action.

The new legislation does not provide for the arbitration of industrial disputes; it will facilitate negotiations and assist the parties reach a settlement but will not arbitrate and determine disputes.

For further information on the new legislation please contact either Liz Pinnock on 02 4907 6328 or Tony Cardillo on 02 4907 6329.

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