Who does this affect?

All Australian employers.

What do you need to do?

Consider the implications of the changes for your business. We can help.

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Murray Kellock  
Partner
T +61 3 9643 4172

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Andrew Gray  
Partner
T +61 2 9296 2404

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Perth
Robert Lilburne  
Consider the implications of the changes for your business. We can help.

Canberra
Ian Johnson  
Consider the implications of the changes for your business. We can help.

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On Tuesday 25 November, the Federal Government introduced into the House of Representatives a Bill to replace Australia’s current workplace relations legislation.

The Fair Work Bill contains Labor’s substantive changes to the law as it stood under WorkChoices. If passed, it will replace the Workplace Relations Act 1996 (Cth) (“WR Act”), which will be repealed.

The legislation will have major implications for all employers. While the Bill reflects much of Labor’s previous policy announcements it contains quite a few surprises.

The introduction of the Fair Work Bill follows the commencement in March of the Government’s transitional Act, which among other things abolished the making of new Australian Workplace Agreements (see our previous alert).

A summary of some of the Bill’s main features is set out below.

Over the coming days and weeks we will be undertaking a thorough review of the Bill and - when they are released - the transitional provisions. Stay tuned for more information about what you need to know.

Key changes

The key changes proposed by the Bill are:

Framework of the Bill

The Bill comprises six chapters:

• Chapter 1 provides an introduction to the Bill and its structure, and contains relevant definitions.
• Chapter 2 deals with terms and conditions of employment, including the National Employment Standards, modern awards, enterprise agreements and workplace determinations and transmission of business.
• Chapter 3 concerns rights and responsibilities of employees, employers and organisations, including freedom of association, protection from discrimination, unfair dismissal, industrial action and rights of entry.
• Chapter 4 deals with compliance and enforcement, including remedies, and jurisdiction and powers of the courts.
• Chapter 5 contains administration provisions, including establishment of Fair Work Australia and the Office of the Fair Work Ombudsman.
• Chapter 6 houses a range of miscellaneous matters.

Fair Work Australia (“FWA”)

Fair Work Australia

FWA will be a new independent statutory agency comprised of its President, Deputy Presidents and Commissioners, and a Minimum Wage Panel.

The Bill confers functions on FWA in relation to a range of matters, including:

• providing information and advice on its functions and activities, including publishing material and guides to assist employers and employees to understand parts of the Bill
• conducting conferences or holding hearings to inform itself about any matter before it, including unfair dismissals and discrimination-related matters
• dealing with disputes about a range of matters, including bargaining, general protections, right of entry and stand down, by mediation or conciliation, or by making a recommendation or expressing an opinion, and in some circumstances by holding a hearing
• where expressly authorised under the Bill, dealing with certain kinds of disputes by arbitration (for example, where the parties consent to arbitration of a bargaining dispute, and disputes in relation to right of entry and stand down)
• approving and varying enterprise agreements
• through the Minimum Wage Panel, conducting annual wage reviews and setting or varying minimum wages in modern awards and a national minimum wage order
• ensuring compliance with workplace laws, awards and agreements
• facilitating collective bargaining and enforcing good faith bargaining, and
• regulating unions and registered industrial organisations.

FWA will be required to perform its functions and exercise its powers in a manner that is fair and just, open and transparent, quick, informal and avoids unnecessary technicalities, and “promotes harmonious and cooperative workplace relations”. It will be required to take into account a range of matters including the need to respect diversity in the workforce.

The Bill also includes a range of offences in relation to FWA that are punishable by imprisonment of up to either six or 12 months. These largely replicate similar offences currently in the WR Act.

In October, the Deputy Prime Minister announced all current Australian Industrial Relations Commission members would be offered roles with FWA with full preservation of their conditions and, where applicable, their status as judges.

Fair Work Ombudsman

The Bill also creates a Fair Work Ombudsman. The Ombudsman’s functions will include monitoring compliance, carrying out investigations and bringing legal proceedings, issuing compliance notices, and educating employees, employers and organisations about their rights and responsibilities.

The Ombudsman may appoint Fair Work Inspectors, who would have a number of powers including to enter premises, interview people, and inspect and take documents for the purposes of determining whether the legislation or certain other instruments have been complied with.

National Employment Standards (“NES”)

Our previous alert provided details of the final form of the NES released by the Government in June 2008.

The Bill retains the substance of the NES as reported by us in June, with a few minor amendments. The most significant changes are:

• the Bill permits employees who are not covered by a modern award or enterprise agreement to cash out annual leave in certain circumstances, including a requirement that this be by written agreement with their employer and the employee retains at least four weeks’ annual leave after cashing out, and
• employees with less than six months’ service are not entitled to the minimum notice of termination prescribed by the NES. For small business employers (who employ fewer than 15 people), this exclusion applies if the employee has worked for less than 12 months.

The Bill has also added a section to the NES dealing with various other matters such as leave entitlements while on workers’ compensation.

In addition, the Bill clarifies the relationship between the NES, modern awards and enterprise agreements. A modern award or enterprise agreement cannot exclude any provision of the NES, but may include:

• certain provisions permitted by the section of the Bill which deals with the particular NES matter, such as cashing out of leave and substitution of public holidays, and
• provisions that supplement the NES or are ancillary or incidental to the NES, as long as the provisions are not detrimental to an employee when compared to the NES.

Modern awards

Terms of modern awards

Awards will build on the minimum entitlements guaranteed in the NES. Modern awards will deal with a number of matters, including:

• Minimum wages: including skill-based classifications, career structures, incentive-based payments, bonuses, wages and apprentice and trainee arrangements.
• Type of work performed: including permanent, casual, flexible work arrangements and job sharing.
• Arrangements for when work is performed: including hours of work, rostering, rest breaks and meal breaks.
• Overtime rates.
• Penalty rates: for employees working unsocial, irregular or unpredictable hours or on weekends, public holidays and as shift workers.
• Annualised wage or salary: arrangements that have regard to patterns of work in an occupation, industry or enterprise as an alternative to penalty rates, and that include appropriate safeguards to ensure individual employees are not disadvantaged.
• Allowances: including reimbursement of expenses, higher duties and disability payments.
• Leave and leave loading.
• Superannuation.
• Consultation: including representation and dispute settling processes.

Awards may also deal with other matters, including conditions of employment for outworkers, industry-specific redundancy schemes and incidental and machinery terms.

The Bill specifies a number of matters that must be included in modern awards. These include coverage terms, dispute settling procedures for disputes arising under the award or the NES, and ordinary hours of work.

Modern awards must also include a flexibility term permitting employers and individual employees to negotiate individual agreements on certain matters. The Commission has published a model flexibility provision as part of the award modernisation process. The employer and employee must genuinely agree to any individual flexibility arrangement, the arrangement must be in writing and signed, and the employer must ensure that the arrangement would result in the employee being “better off overall”.

The Bill also specifies a number of matters that must not be included in modern awards, including terms about deductions and payments for the benefit of an employer, long service leave, right of entry, discriminatory terms, and terms that apply differently in different states (although some terms of this type may be included for up to five years).

Review of modern awards

The Bill requires FWA to review modern awards every four years. At this time, FWA may make new awards, or vary or revoke existing awards. During these reviews, FWA may vary minimum wages in awards only if this is justified for “work value reasons”.

The Bill also permits FWA to create, vary or revoke modern awards outside the four year review period if it considers this is “necessary to achieve the modern awards objective”, to update the names of employers, organisations or outworker entities bound by the awards, to remove ambiguity or uncertainty or correct an error, or if the award is referred to it under the Human Rights and Equal Opportunity Commission Act 1986 (Cth).

High income employees exempt from award coverage

Modern awards will not apply to “high income employees” with a “guarantee of annual earnings” above a certain amount (initially expected to be $100,000, indexed from 27 August 2007). The concept of “guarantee of annual earnings” is discussed below. High income employees will still be covered by the NES.

Collective bargaining and enterprise agreements

Types of agreements

Collective agreements will now be either “single-enterprise agreements” or “multi-enterprise agreements”.

Single and multi-enterprise agreements can be made as “greenfields agreements” if the agreement relates to a “genuine new enterprise”. This enterprise must be new, not an existing enterprise acquired as a going concern. Greenfields agreements can only be made with employee organisations (ie unions).

Bargaining process

There are no formal steps required to commence a bargaining process.

If an employer agrees to bargain (or initiates bargaining), it must, as soon as practicable and within 14 days, take reasonable steps to give to each employee who will be covered by the agreement a notice of the right to be represented by a bargaining representative. Every employee is entitled to appoint a bargaining representative, who can be anyone. However, if an employee wishes to appoint a union as his/her bargaining representative, that union must be entitled to represent the industrial interests of the employee in relation to work that will be performed under the agreement.

Employers will not be entitled to refuse to recognise or bargain with a bargaining representative of the employees.

If an employer is not prepared to bargain, a bargaining representative of the employees can apply to FWA for a determination that a majority of the employees who will be covered by the agreement want to bargain with the employer (a “majority support determination”). FWA will work out whether a majority of employees want to bargain by using any method it considers appropriate. If a majority support determination is made, FWA will direct the employer to issue employees with the notice of their right to be represented (see above).

Bargaining for an agreement can occur at any time. However, if an existing enterprise agreement is in operation, a bargaining representative cannot be required to comply with the good faith bargaining requirements if it is more than 90 days before the nominal expiry date of the current agreement.

Good faith bargaining

Bargaining representatives (for both employers and employees) must meet good faith bargaining requirements. These requirements are to:

• attend at and participate in meetings at reasonable times
• disclose relevant information (other than confidential or commercially sensitive information) in a timely manner
• respond to proposals in a timely manner
• give genuine consideration to proposals and reasons for responses to those proposals, and
• refrain from capricious or unfair conduct that undermines freedom of association or collective bargaining.

However, these requirements do not require a bargaining representative to make any concessions or reach any agreement (but see workplace determinations below).

If a bargaining representative does not meet these requirements, or bargaining is not proceeding efficiently or fairly because there are too many bargaining representatives, FWA may make a “bargaining order”. Bargaining orders must specify a variety of matters including the actions to be taken to comply with good faith bargaining obligations. FWA can exclude parties from bargaining and require multiple bargaining representatives of employees to appoint one of them to represent the others.

If a party breaches a bargaining order and does so in a serious and sustained way, FWA may make a “serious breach declaration”. This could result in a workplace determination (see below).

If a bargaining representative for a single enterprise agreement has concerns that the bargaining is not proceeding efficiently or fairly because the proposed agreement will not cover all appropriate employees or will cover inappropriate employees, that representative can apply to FWA for a “scope order”. Scope orders will specify the employees to be covered by the proposed agreement.

If the negotiations break down, a bargaining representative can ask FWA to deal with the dispute. However, FWA can only arbitrate the dispute if the parties agree (but see workplace determinations below).

A special scheme will be put in place to enable and assist low paid employees and their employers to make enterprise agreements.

Workplace determinations

FWA must make an “industrial action related workplace determination” if:

• FWA makes an order to suspend or terminate industrial action, because, for example, the action is causing significant economic harm to the parties (see our discussion of industrial action below), or
• the Minister makes a declaration terminating protected industrial action and a “post-industrial negotiating period” (of either 21 or 42 days) passes without a resolution.

If FWA makes a serious breach declaration (see above), and the post-declaration negotiating period ends without a resolution, FWA must make a “bargaining related workplace determination”.

These workplace determinations set out the terms that FWA considers are necessary to resolve the dispute between the parties. These determinations must also contain a variety of other matters - agreed terms, core terms and mandatory terms. Workplace determinations operate like enterprise agreements.

Workplace determinations enable FWA to impose terms on the bargaining parties to resolve their disputes.

Terms of enterprise agreements

Enterprise agreements may contain “permitted matters”. These are:

• matters pertaining to the employment relationship (preserving the “matters pertaining” rules flowing from the High Court’s decision in Electrolux)
• matters pertaining to the relationship between the employer and an employee organisation that will be covered by the agreement (for example, terms relating to union training leave, paid time off to attend union meetings, union involvement in dispute settlement procedures, promotion of union membership and provision of information to unions about employees)
• deductions from wages (for example, deduction of union membership fees), and
• how the agreement will operate (for example, terms setting out how and when negotiations for a replacement agreement will be conducted).

Enterprise agreements must include:

• a flexibility term - enabling the employer and an employee to agree on arrangements which vary the effect of the agreement
• a consultation term - requiring the employer to consult the employees about major workplace changes
• a nominal expiry date - which may not be more than four years after the day on which FWA approves the agreement, and
• a dispute resolution clause - which includes provisions allowing for representation of employees.

Enterprise agreements must not contain:

• a provision which contravenes a NES
• discriminatory terms (because of an employee’s race, colour, sex, sexual preference, age, physical and mental disability, marital status, family or carer’s responsibilities, pregnancy, religion, political opinion, national extraction or social origin)
• objectionable terms (contravening workplace rights - freedom of association)
• provisions for bargaining service fees
• provisions which exclude or modify unfair dismissal laws
• terms which are inconsistent with the Act’s provisions in relation to industrial action, or
• terms that provide for right of entry inconsistent with the Act’s right of entry provisions.

Additionally, the base rate of pay under an enterprise agreement cannot be less than the base rate of pay under a relevant modern award at any time during the life of the agreement.

Voting

An employer may request the employees to approve an agreement by voting for it. This request must not be made until at least 21 days after the day on which the employer gave notice of the employees’ representational rights.

Before an employer requests that employees approve an enterprise agreement, it must take all reasonable steps to ensure that for a period of seven days the employees are given a copy of or access to the agreement. The employer must also notify the employees of the time and place at which the vote will occur and what voting method will be used. Additionally, the employer must take all reasonable steps to ensure that the terms of the agreement and the effect of those terms are explained to the employees. This explanation must be provided in an appropriate manner, taking into account the particular circumstances and needs of the relevant employees. These needs include culturally and linguistically diverse backgrounds, youth and the absence of a bargaining representative.

An enterprise agreement is made when a majority of employees who cast a valid vote approve the agreement. The process is a little more complicated in relation to multi-enterprise agreements. A greenfields agreement is made when it is signed by the employer and each union that will be covered by the agreement.

After an enterprise agreement is made, an employee organisation that was a bargaining representative may give FWA a written notice stating that it wants the agreement to cover it. When FWA approves the agreement (see below), it must note in its decision that the agreement covers this organisation.

Approval

Once an agreement has been made, a bargaining representative must apply to FWA for approval of the agreement. This application must be accompanied by a signed copy of the agreement and any declarations that are required by the procedural rules to accompany that application. This application must be made within 14 days after the agreement is made.

FWA will approve the agreement if it is satisfied that the agreement has been genuinely agreed to by the employees and it passes the “better off overall test”. There are some additional requirements in relation to multi-enterprise agreements.

Better off overall test

An enterprise agreement passes the better off overall test if FWA is satisfied, as at the test time, that each award covered employee (and prospective award covered employee) would be better off overall if the agreement applied than if the applicable modern award applied to the employee. The test time is the time the application for approval of an agreement is made.

FWA can approve an agreement which does not pass the better off overall test if it is satisfied that, because of exceptional circumstances, approval would not be contrary to the public interest.

Commencement

Enterprise agreements come into effect seven days after FWA approval.

Variation and termination of enterprise agreements

The Bill also contains provisions enabling the variation and termination of agreements.

Generally, the process for varying and terminating an enterprise agreement is the same as that for making an agreement. However, the good faith bargaining rules do not apply.

FWA can also vary enterprise agreements to remove an ambiguity or uncertainty.

The FWA will not terminate an enterprise agreement after it has passed its nominal expiry date unless it is not contrary to the public interest to do so.

Industrial action

The Bill retains many of the current rules relating to industrial action. This includes requirements that protected industrial action is only permissible in support of enterprise bargaining agreement negotiations, a mandatory secret ballot be held and approved by the workforce and that strike pay not be paid.

The Bill introduces a number of new concepts as well as removing various features of the current WR Act regulation of industrial action. These changes include:

• the removal of the concept of the “bargaining period”. Protected industrial action will be permissible once the secret ballot and notice requirements have been met
• the introduction of express “common requirements” that must be met for industrial action to be “protected action”. These include, among others, that parties genuinely try to reach agreement, comply with industrial action orders and are not engaged in pattern bargaining. A failure to comply with the requirements may expose a party to the imposition of stop orders by FWA in relation to the industrial action
• the introduction of three types of protected industrial action - “employee claim action”, “employee response action” and “employer response action”
• employer industrial action will only be protected action where it is taken in response to industrial action taken by its employees
• employees will no longer bear the onus of proof in showing that action taken on the grounds of health and safety was not industrial action
• that parties will have the right to apply for a secret ballot order up to 30 days prior to an agreement’s nominal expiry date
• granting power to FWA to extend the period in which protected action may be taken by an additional 30 days without the need for employers to give their consent
• that liability for the cost of any protected action ballot undertaken by the Australian Electoral Commission rests entirely with the Government, and
• the introduction of extensive new rules regarding payments made to employees where they have imposed partial work bans or overtime bans.

If industrial action is causing significant harm to the wider economy, community or third parties or for the purposes of “cooling-off”, FWA will have the power to suspend or terminate the industrial action. FWA will also be able to suspend or terminate industrial action if it causes significant economic harm to the bargaining participants. In determining whether significant economic harm is being caused, FWA will consider, among other things, whether good faith bargaining requirements have been met.

Deductions for wages and payment requirements

The Bill contains provisions regulating deductions from employee remuneration payments similar to those which currently exist in some State legislation (and have proved problematic for employers in the past). The provisions require any deductions to be both:

• authorised in writing, and
• principally for the employee’s benefit.

The Bill also provides that a term of an enterprise agreement, award or a contract of employment will be of no effect to the extent that it permits deductions from an employee's remuneration if the deduction is:

• directly or indirectly for the benefit of the employer, and
• unreasonable in the circumstances.

Guarantee of annual earnings

The Bill introduces the concept of a "guarantee of annual earnings" agreement for high income earners. A high income earner will be defined in the Regulations, but the Explanatory Memorandum proposes that the amount will be $100,000 subject to indexation from 27 August 2007.

The Bill specifies the earnings that are to be included when making this calculation. The earnings do not include:

• payments which cannot be determined in advance (some examples are: commissions, incentive based payments and bonuses and overtime, unless the payment is guaranteed), and
• compulsory superannuation contributions.

To satisfy the requirements of the legislation the guarantee will need to be in writing and agreed to by the employee within 14 days of an employee commencing employment (or agreeing to vary their terms of employment). The employer is also required to notify the employee in writing that a modern award will not apply to the employee whilst they are subject to the guarantee.

Guarantees cannot be entered into with employees who are covered by an enterprise agreement.

Transmission of business

The Bill makes significant changes to the transmission of business rules, introducing a new test for determining when a “transmission of business” (or under the terminology used in the Bill, a “transfer of business”) occurs for the purposes of determining whether industrial instruments transmit to a new employer.

The new test provides that an industrial instrument will transfer to the new employer where:

• the work (the “transferring work”) the employee performs for the new employer is the same, or substantially the same, as the work the employee performed for their old employer, and
• the work transfers in connection with:

This test focuses on there being a similarity in the work performed by employees, rather than looking at whether a business (or part of a business) has been transferred as is currently the case. Significantly, all outsourcing or insourcing of work will result in industrial instruments which apply to the old employer transferring to the new employer.

Further major changes include:

• the 12 month transmission period under the WR Act is abolished. Under the Bill, transmitted industrial instruments will now apply until they are replaced by another industrial instrument. A transmitted industrial instrument will prevail over any other industrial instrument which applies to the new employer in respect of work performed by the transferring employee
• transmitted industrial instruments will also apply to new non-transferring employees who are engaged by the new employer to perform the transferred work (provided that no other industrial instrument applies to that employee)
• guaranteed annual earning undertakings (discussed above) will also bind a new employer in a “transfer of business”. The Bill contemplates that where an employee is entitled to non-monetary benefits under the annual earnings guarantee, and it is not practicable for the new employer to provide those benefits, then the employee will be entitled to the cash equivalent of the agreed monetary value of those benefits. The Bill also imposes obligations on the outgoing employer to make sure obligations under the annual earnings guarantee have been satisfied on termination, and
• FWA is also provided with the ability to make orders that industrial instruments should or should not cover transferring employees and to vary transferring industrial instruments.

Unfair dismissal

The Bill abolishes the 100-employee exemption introduced by WorkChoices. The protection from unfair dismissal will apply to all employees who have completed a “minimum employment period” and:

• are covered by a modern award and/or an enterprise agreement, or
• the sum of the person’s annual rate of earnings and other specified amounts is less than a prescribed “high income threshold”.

In respect of small business employers (who employ fewer than 15 employees), the minimum employment period will be 12 months. For all other employers it will be 6 months, mirroring the current 6 month qualifying period under the WR Act.

The “high income threshold” for access to unfair dismissal rights will initially be $100,000, indexed from 27 August 2007.

The unfair dismissal provisions will not be available to a person who has been dismissed in a case of “genuine redundancy”. This will occur where the job is no longer required due to changes in the employer’s operational requirements, and the employer has complied with any consultation obligations in an applicable industrial instrument. It will not be a “genuine redundancy” if it would have been reasonable for the employee to be redeployed within the employer’s enterprise or that of an “associated entity”. Reasons for a particular employee’s selection for redundancy will not be captured, although these may otherwise breach other provisions of the Bill providing general protection from discrimination.

The Bill sets out criteria to which FWA must have regard in determining whether a dismissal was unfair. These are the same factors as set out in the WR Act, plus a new factor, being “any unreasonable refusal by the employer to allow the person to have a support person present to assist at any discussions relating to dismissal”. This will only apply where the employee actually asks to have such a support person present.

Another significant feature of the Bill is that the unfair dismissal claim will - in the absence of exceptional circumstances - have to be made within 7 days of the dismissal.

FWA will be responsible for reviewing each application and, before considering its merits, must consider whether the employee was protected from unfair dismissal, whether it was a genuine redundancy and whether the time period for applications was complied with. A decision in relation to these initial matters is appealable.

Where facts are in dispute between the parties, FWA must “conduct a conference or hold a hearing” to inform itself. However, its power to hold a hearing is limited to circumstances where it is appropriate to do so having regard to, among other matters, efficiency and the views of the parties.

Where there are no facts in dispute, FWA has discretion as to whether to hold a conference or a hearing.

Where it does hold a conference, FWA must take into account “any difference in the circumstances of the parties”, including their advocacy experience, and the procedural “wishes” of the parties, including in relation to the location of the conference or the method of conducting it. A conference may be conducted by a member or a delegate of FWA.

The Bill also provides for the President of FWA to make procedural rules in relation to a range of matters, including the manner in which unfair dismissal conferences are to be conducted.

Parties will not be entitled to be represented by a lawyer or a paid agent in most matters before FWA, including unfair dismissals, without FWA’s permission. FWA’s discretion to grant this permission is limited to circumstances where such representation would enable the matter to be dealt with more efficiently or it would otherwise be unfair to refuse such permission.

FWA may only grant permission to appeal an unfair dismissal decision on public interest grounds, unless the appeal question is one of fact and concerns a significant error of fact.

The Bill has also introduced a Small Business Fair Dismissal Code to assist small business employers. Where a small business employer complies with the Code no remedy will be available to the dismissed employee.

The rules regarding unfair dismissals are intended to come into force on 1 July 2009. This will be six months earlier than the intended date of commencement of the balance of Labor’s substantive changes.

Right of entry

Under the WR Act, union officials with a right of entry permit are able to visit employees in three circumstances:

• to investigate breaches of industrial law, awards or agreements
• to hold discussions with employees who are, or are eligible to be, members of the union, or
• to investigate breaches of occupational health and safety laws.

The Bill retains these three as the only permitted purposes. The Bill also retains the current requirements that:

• the union official must obtain an entry permit before entering the premises
• the union official must be considered a “fit and proper person” before being issued an entry permit. FWA will now make this determination
• union officials may only enter the workplace if they give an “entry notice” to the occupier of the premises during working hours at least 24 hours, but not more than 14 days, before the entry.

Most other procedural requirements and prohibitions against obstructionist conduct such as hindering a permit holder’s entry will remain the same.

Expansion of right of entry

The Bill expands the circumstances in which union officials can enter workplaces. Under the WR Act, permit holders can only enter to investigate breaches or hold discussions with employees where there are employees on the premises that are covered by an industrial instrument that is binding on the union. Under the Bill, union officials will be able to enter premises to hold discussions with one or more persons:

• who perform work on the premises
• whose industrial interests the union is entitled to represent, and
• who wish to participate in those discussions.

Similarly, union officials will be able to enter premises to investigate a suspected contravention if the contravention relates to or affects a member of the union:

• whose industrial interests the union is entitled to represent, and
• who performs work on the premises.

This means unions can enter workplaces in a significantly greater set of circumstances as there is no need to refer to an industrial instrument that governs the employee’s work.

Access to records

When a union official enters premises to investigate suspected breaches, the Bill allows for access to relevant documents regardless of whether they relate to a union member. As such, the Bill dispenses with the current limitation in the WR Act that only allows inspection of union member records unless the Commission orders otherwise.

To counteract the widening of access to records, the Bill creates a new prohibition on using or disclosing employee records obtained by permit holders if such use or disclosure is for a purpose other than the primary purpose of the record’s collection.

Other changes

If the union official enters the workplace to investigate breaches, the Bill provides that he or she must give the entry notice to any “affected employer” in addition to the current requirement to give the notice to the “occupier” of the premises.

The Bill also adds additional content requirements for entry notices. In the case of a suspected breach, they will have to contain a declaration that the permit holder’s union is entitled to represent the industrial interests of an affected member. In the case of entry to hold discussions with employees, they will have to contain a declaration that the permit holder’s union is entitled to represent the industrial interests of a person who performs work on the premises. In both cases, the notice will have to refer to the provision of the union’s rules that creates such an entitlement.

The Bill also allows unions to apply to FWA for an “affected member certificate” to certify that:

• a member of the union works on particular premises
• the union is entitled to represent the member’s industrial interests, and
• the suspected breach that the union is investigating relates to or affects the member.

General protections from adverse action

A “workplace right” includes an entitlement to the benefit of, or a role or responsibility under, a workplace law, workplace instrument or order of an industrial body. It also includes the ability to initiate or participate in a process or proceedings under such a law or instrument, and the ability to make a complaint or inquiry to certain persons, including the employer.

This new concept of “adverse action” is defined broadly to include a range of actions which vary according to the particular workplace participants in question (for example, action by an employee against their employer, action by a prospective employer against a prospective employee or action by a union against a person).

Significantly, the general protections provisions do not only apply to employers, employees and unions. The Bill also defines “adverse actions” to include certain actions by a principal against an independent contractor, and by an independent contractor against its contractors or employees. In this context, adverse actions include termination of a contract, ceasing work under the contract or refusing to supply goods and services to an independent contractor, among others.

As an alternative to proceeding directly to court in relation to a dispute about contravention of the general protections provisions, the parties may agree to apply to FWA for a conference to deal with the dispute by conciliation, mediation or making a recommendation or expressing an opinion. If unresolved, the dispute may then proceed to a court.

Dismissal-related contraventions of the general protection provisions (eg termination for a discriminatory reason) will generally be dealt with by a FWA conference in the first instance. Such applications do not require agreement of both parties but must generally be made to FWA within 60 days.

Protection from discrimination in employment

In the context of action by an employer against an employee, “adverse action” includes such things as dismissing the employee, injuring them to their detriment and altering the employee’s position to their prejudice.

An action will not be an “adverse action” if it is authorised under a State or Territory anti-discrimination or equal opportunity law, or if it is taken because of the inherent requirements of the particular position.

This significantly expands the scope of the current legislation’s anti-discrimination protection in employment, which was generally limited to a prohibition on termination for discriminatory reasons. This new provision prohibits a much broader range of conduct taken for discriminatory reasons.

Compliance and enforcement

Penalties for breaching the NES, modern awards or enterprise agreements will be a maximum of 60 penalty units (currently $6,600 for individuals or $33,000 for bodies corporate). The Federal Court and the Federal Magistrates Court will be empowered to make any orders it finds appropriate, including injunctions in relation to alleged breaches of civil remedy provisions.

One significant new concept introduced by the Bill is that of “safety net contractual entitlements”. These are entitlements under a common law employment contract between an employer and employee regarding matters which are dealt with in the NES or modern award. If the Bill is passed, these entitlements will have effect as an entitlement under the Fair Work Act. If a safety net contractual entitlement is breached, the employer or employee may apply to the Federal Court or Federal Magistrates Court to enforce the entitlement.

Further, if a Fair Work Inspector brings an action against an employer for breach of the NES, modern award, enterprise agreement or other specified instrument, the inspector may also apply on the employee’s behalf for an order in respect of an employer’s contravention of a safety net contractual entitlement.

The Bill also creates new Fair Work Divisions of the Federal Court and Federal Magistrates Court to deal with breaches of awards, agreements and the NES. There will also be a small claims jurisdiction for claims of up to $20,000. Under the small claims procedure, the relevant court would not be bound by the rules of evidence and procedure and may act in an informal matter, and parties could only be represented by lawyers with leave of the court.

Final words