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Employment law

Industrial Action

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Industrial Action

All industrial action except for protected action has been outlawed, as has industrial action during the term of an agreement. Tough new conditions in Workchoices also requires secret ballots before industrial action is taken and require that a minimum
of four hours pay must be docked if employees take industrial action. Additionally, employers are able to lock employees out in an industrial dispute and employers no longer have to wait for a s166A certificate for access to common law remedies for unprotected action.

S 170MX arbitrated awards has been replaced with a provision for a workplace determination. This is the only circumstance where the AIRC can arbitrate. The remedy allows the Minister to issue a declaration where industrial action is threatening
peoples life, safety or the welfare of the economy.

Right of Entry

Workchoices has introduced very tough right of entry rules. Unions have no right of entry at AWA or collective non union agreement workplaces for discussion and recruitment. In order to investigate a breach at any workplace, officials are required
to give at least 24 hours notice. If they require entry to investigate a breach of an AWA, the affected employee must provide written consent.

When investigating a breach, unions may only have access to the records of union members, unless they have an order from the AIRC to investigate the non union member and comply with the employers’ requests as to where they can meet with the workers. There is a ‘fit and proper purpose’ test in order to gain these permits. Additionally, the grounds on which the permits can be revoked have been expanded.

Freedom of Association

Workchoices made substantial changes to freedom of association laws. These were designed to water down the provision that unions relied upon in the waterfront dispute in 1998. In this dispute unions claimed that sacked workers were being injured in their employment because of their entitlement to an industrial instrument. During the dispute, this only ad to be one of the reasons why there were dismissed. With the Workchoices changes, it has to be the sole or dominant reason.

Transmission of Business

Agreements and awards that transfer to a new employer will only survive for 12 months. However, due to a Family First amendment, redundancy entitlements due to employees will last at least two years after the transmission of business. Though, they could still be lost if employees signed a new agreement, as redundancy pay is not a ‘protected’ award condition under Workchoices.

The implementation of the Fairness test legislation enforces the notion that prohibition on AWA duress applies when an employer who has acquired a business seeks to continue employment with a condition that an AWA be signed.

Termination of Agreements

Agreements which have passed their nominal expiry date can be terminated by either party by giving 90 days notice, with the AFPC’s and the protected award conditions a safety net if a replacement agreement is not agreed upon.

Dispute Resolution

There are no longer compulsory powers of conciliation and arbitration vested in the AIRC. Instead of this, the AIRC will provide voluntary dispute resolution services. The only exception to this is terminating a bargaining period where industrial action is threatening life or causing damage to the economy.

Unlawful Termination

It is illegal to terminate employment for discriminatory reasons. These include union membership, sex, race and pregnancy or for refusing to sign or vary an AWA. Unlawful termination claims are heard in either the Federal Court or the Federal Magistrates Court. Employees making such a claim, are provided up to $4000 worth of legal advice from the Government.

Institutions

The Government’s reforms have greatly altered the AIRC. They have done this by removing its wage-setting and agreement making function. However it retains some powers for unfair dismissal, bargaining and dispute resolution purposes. With its legislation, it has established the Fair Pay Commission, Workplace Authority (previously the Office of the Employment Advocate), Workplace Ombudsman (previously the Office of Workplace Services) and the Australian Building and Construction Commissioner (ABCC).

Building and Construction

The Government will retain its industry specific construction legislation, plus the ABCC. The ABCC has wide reaching investigative powers. Also to be retained is the building code of conduct and guidelines.

Employment law

Expansion of the unfair dismissal jurisdiction

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The ‘100 employees or fewer” constraint will no longer exist under a Labor Government.
Fair Work Australia will allow an employee to bring an unfair dismissal claim
1) If they work for an employer who employs more than 15 employees and have worked there for at least 6 months.
2) If they work for an employer who employs less then 15 employees and have worked there for at least 12 months
3) If they earn less than $98 200 per annum and they are not covered by an award.
An unfair dismissal claim must be brought to Fair Work Australia within seven days. Remedies include reinstatement in employment or compensation where reinstatement is no longer appropriate.

A Fair Dismissal Code will be introduced for small business which is designed to mollify the all important small business owner voting bloc. Where a business has dismissed an employee within the specifications of the code, that dismissal will be considered to be fair. .
Intriguingly, the yet-to-be-drafted Code will deal with situations where “an employer has reported an employee to the police for suspected theft, fraud or for violence in the workplace…. Employees who engage in stealing, violence, or disruption at
work don’t deserve protection from dismissal.”5

How this affects the rights of an innocent employee who is reported to the police by a suspicious or malicious employer, is not canvassed. One hopes it will be, when and if the Code comes into existence. However, since the code has not yet been drafted, it is not known what practical effect it will have on a pre-existing right to be protected from unfair dismissal.

Employment law

Tristar Continued – The dispute is over

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We followed the predicament of the ‘Tristar’ employees in our 8th edition newsletter. Now the matter has been fully settled. In June of 2007, a number of employees had been left without their redundancy entitlements because the company was ordering
them to turn up to work when there was no work for them to do.

The reason for this was because it was cheaper to keep the employees at work, than pay out their generous redundancy entitlements, which were four weeks pay for every year they had worked for Tristar. This group of approximately 35 employees had an average length of service of 30 years, and the longest serving in of this group had worked at Tristar for 44 years. This person would be entitled to 176 weeks severance pay plus five weeks notice.

The workers were entitled all together to $3.6 million in uncapped severance benefits under their agreement, whereas Tristar opted to keep them in employment for 12 months, spending up to $1.9 million. Hence it was cheaper to keep the workers
employed on the basis that the manufacturing facility needed to remain operating. The Australian Manufacturers Workers Union (AMWU) and the Australian Workers Union (AWU) also claimed that it was cheaper to keep the workers in employment
rather then paying them their redundancy benefits.

Managers, the computer programmer, the toolmaker and the safety officer all had no tasks to perform. Despite the fact that the Australian Industrial Relations Commission terminated the original agreement, the severance arrangements continued to apply until June 2009. This was because Family First in June this year successfully altered to 24
months, an amendment to Work Choices which provided 12 months protection for redundancy entitlements when agreements ended.

On 31 August, 13 employees won a settlement with Tristar to receive their entitlements under their employment agreement. On 4 September, Tristar agreed to a further 11 employees being paid their entitlements. This will leave only seven employees
on the payroll. These employees were allegedly entitled to the same redundancy package due to an exchange of letters.

On Thursday 15 November, the dispute over the redundancy payments was resolved. Tristar agreed to pay three employees from the Marrickville plant their redundancy entitlements and the last of 32 manufacturing employee’s will be leaving Tristar
on November 30. There seems to be some dispute as to who actually achieved the result for the remaining employees at Tristar. Workplace Relations Minister Joe Hockey has claimed credit for the payment of the entitlements and has welcomed Tristar’s decision.
However Martin Schutz from the AMWU did not believe that the decision was a result of the Minister and the Government’s efforts.

He believes that it was the union who persuaded Tristar to make the redundancy payments and that the Government’s legal action had been ineffective.
In spite of this disagreement, Tristar will continue to be prosecuted by the Workplace Ombudsman for breaching workplace laws in the Federal Court. They face a maximum fine of $33 000 per breach.

The Workplace Ombudsman called a psychiatrist Dr Ian Hickie, who stated that there were highly elevated levels of psychological stress amongst this group of Tristar workers. He concluded that these were directly attributable to their exposure to their work environment. McArdle legal will be following Tristar’s prosecution closely and will let readers know what happens in Tristar’s prosecution.

Employment law

Giving the primary focus to collective rather than individual bargaining

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The policy centres around collective enterprise agreement making, as opposed to individual agreements such as Australian Workplace Agreements (AWA’s) or statutory individual contracts.Agreements may be made between employers and unions or employers and groups of employees in a workplace who are not union members.

Collective Greenfield Agreements may also be negotiated between an employer and a union. There will be an approval process for agreements through Fair Work Australia.
The Participants who engage in Collective Bargaining will be required to do so in good faith. This includes attending meetings, disclosing relevant information, responding quickly to proposals, giving genuine consideration to proposals and refraining
from capricious or unfair conduct which undermines freedom of association or collective bargaining.

Labor has emphasised that it “believes that Australian Workplace Agreements should not be a part of Australia’s future.”2

The estimate is that 5% of the Australian workforce is a party to an AWA. The ALP intends to move all of that 5% off AWAs by 2010. It will do this by means of Individual Transitional Employment Agreements, or ITEAs. Although all existing
AWAs will run their full course of up to five years post the election, upon expiry of an AWA the employee will be moved to an ITEA – that is what the document will then be called. These instruments will function as a ‘bridge’ from the expired AWA to another industrial instrument, such as an award or collective enterprise agreement, and are intended to expire by 31 December 2009 at the latest. Labor’s projected chronology of the transition process notes that the last possible expiry date for any AWA will be 31 December 2012.3 Thus, its intention appears to be that those employees who were previously covered by an AWA will ultimately move to awards, collective agreements or common-law contracts.

A likely outcome is that in a large number of cases where AWAs apply, nothing will be done by the parties to them prior to the end of 2009. That probably means the relationship will become award – free, and the AWA will then revert to the status
of a common law contract.

Employees who wish to collectively bargain will be able to do so. In a unionised workplace, they can elect to have the relevant union act as their bargaining agent; alternatively, employees in both unionised and union-free workplaces may bargain
directly with their employer, with promised assistance from Fair Work Australia.

Industrial Action

With the exception of a stronger role for the umpire, Labor’s new approach to industrial action is identical to that of the Howard Government. Protected action will only be allowed during an approved bargaining period for a collective enterprise
5 agreement; industrial action will be prohibited if it is in support of pattern bargaining; and a secret ballot must be held if protected action is proposed. The only difference is that Labor would assign the responsibility for supervision of the processes surrounding protected industrial action to Fair Work Australia.4

Employment law

10 National Employment Standards

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The following minimum standards will apply to all employees irrespective of their industry or occupation.
• Hours of work – there will be a 38 hour standard week for full-time employees. Additional hours could be required where those hours are not unreasonable.
• Parental leave – it will be possible for both parents to have separate periods of 12 months unpaid parental leave and the ability of one parent to request an additional 12 months leave.
• Flexible work for parents – there will be a right to request flexible work arrangements up until children reach school age. This may only be refused on reasonable business grounds.
• Annual leave – full time employees will be entitled to 4 weeks paid annual leave (pro-rated for part-time employees).
Shift workers will be entitled to 5 weeks paid annual leave.
• Personal, carer’s and compassionate leave – full time employees will be entitled to 10 days paid personal/carer’s leave per year (pro-rated for part-time employees), 2 days per year of paid compassionate leave and 2 days unpaid personal leave
for genuine caring purposes and family emergencies.
• Community service leave – there will be paid leave for prescribed community service activities such as jury duty and emergency services duties.
• Public holidays – 8 national public holidays will be guaranteed in addition to state and local public holidays, alternatively there will be a right to be paid appropriate penalty rates or other compensation when an employee is required to work on a public holiday.
• Provision of information in the workplace – employers will be obligated to provide employees with information regarding their rights and entitlements at work.
• Termination of employment and redundancy – up to 4 weeks notice of termination of employment will be required for all employees based on a sliding scale according to years of service and a statutory entitlement to redundancy pay for employees in workplaces with 15 or more employees.
• Long service leave – the current arrangements will remain in state or federal laws until a national standard is established.
Up to 10 more minimum employment standards in awards
Labor has placed great emphasis on the importance of the award system within its proposed national IR system. Words and phrases such as “flexible”, “family-friendly”, “efficient” and “safe” are much in evidence in its Policy Implementation Plan.
It intends to have awards ‘modernised’ and ‘simplified’ by the AIRC. It also intends these modernised awards to apply (by Common Rule, presumably) to all employees who are not covered by a collective agreement or a common-law contract. Labor has also fashioned a proposed award safety net for those earning less than $100,000, consisting of 10 additional standards, or ‘award matters.’

These include:
• Minimum wages – this includes skill based classifications, career structures, incentives based payments, bonuses, wages and apprentices and trainee arrangements.
• Type of work performed – this includes permanent, casual, using flexible work arrangements or job sharing.
• Arrangements for when work is performed – this includes hours of work, rostering, rest breaks and meal breaks.
• Overtime rates – will be provided for working long hours.
• Penalty rates – will be provided for employees who work unsocial, irregular or unpredictable hours or on weekends, public holidays and as shift workers.
• Annualised wage or salary arrangements – this will have regard to the patterns of work in an occupation, industry or enterprise as an alternative to the payment of penalty rates.
• Allowances – this includes the reimbursement of expenses, higher duties and disability payments.
• Leave and leave loading – including arrangements for taking leave
• Superannuation Consultation – including representation and dispute settling procedures.
Under Labor’s proposal, awards will not be extended to cover employees who are traditionally award free. However, they will be reviewed every four years to ensure they remain relevant to those covered by their terms.
Those earning at least more than $100,000 can presumably look after themselves during the negotiating process; Labor claims that this will provide “flexibility for those who are doing well.”
As has been the case for many years, awards will still probably set minimum, and not prescribed conditions. The tradition of “over award” conditions or payments will be allowed to continue, we may expect.
This element of their policy appears to have little purpose other than to re-assure the union movement. It will have little effect by way of restoring centralised wage fixing or similar, which began to disappear under the previous Labor Government, which actively encouraged decentralised one off agreements.