On 27 February 2014, the Government introduced the Fair Work Amendment Bill 2014 (Amendment Bill) into federal parliament. This In Brief summarises the main changes to the FW Act that will occur if the Bill is passed in its present form.
The Amendment Bill proposes a number of changes to the greenfields agreement process intended to prevent employers from being compelled to agree to inflated wages and conditions and employment preference in order to avoid delays to a project. These changes will improve the certainty around major developments and in particular major infrastructure projects that are critical to improved productivity and job creation. The changes are:
The Amendment Bill proposes to wind back recent changes and further amend the right of entry provisions in the FW Act by:
In order to avoid applications having to be made to the FWC to avoid the transfer of industrial instruments between associated entities where an employee seeks out an opportunity in an associated entity, the Amendment Bill proposes that there will not be a transfer of business where:
Amendments have also been proposed to improve the utility of individual flexibility arrangements by:
However, the additional certainty and flexibility for businesses comes with an additional administrative burden. Employees entering into an individual flexibility arrangement will now be required to give a written statement that indicates why they believe an individual flexibility arrangement under a modern award or enterprise agreement meets their needs and leaves them better off.
The amendments will prevent the practice of making enterprise agreements with minimal capacity for individual flexibility arrangements because new enterprise agreements made after the commencement of the relevant provisions would be required to include a flexibility term that allows for variation of all five minimum matters..
The Amendment Bill proposes that an application for a protected action ballot order will not be able to made until the employer is obliged to give employees notice of representational rights in bargaining (reversing the effect of the decision of the Full Federal Court in JJ Richards & Sons Pty Ltd v Fair Work Australia (2012) 201 FCR 297).
The National Employment Standards (NES) currently require annual leave paid out on termination of employment to be paid at the rate that would have been payable if the employee had taken the period of leave. This caused confusion in relation to annual leave loading, which some modern awards required to be paid during a period of leave but excluded from being paid on termination of employment (apparently in breach of the NES provision).
The Amendment Bill proposes that the NES will require annual leave on termination of employment to be paid out at the base rate of pay.
Amendments will also make clear that annual leave entitlements will not accrue during a period in which an employee is absent from work and in receipt of workers’ compensation entitlements, even if this is permitted under the relevant State statute. This will place all national system employees on workers’ compensation in the same position in respect of leave accrual.
It is proposed that employers will be prohibited from refusing requests for extended unpaid parental leave until they have given the employee a reasonable opportunity to discuss the request. The Explanatory Memorandum anticipates that such discussions will be held in person or over the phone but not by email or text message.
The Amendment Bill proposes a more streamlined process in relation to the dismissal of unfair dismissal applications by the FWC. The FWC will no longer be required to hold a hearing or conduct a conference when considering whether to dismiss an unfair dismissal application under section 399A (non-compliance with directions etc) or section 587 (no reasonable prospects of success etc).
However the FWC must first invite relevant parties to provide further information that relates to whether the FWC should exercise its power to dismiss and consider that information before exercising the power.
The Explanatory Memorandum anticipates that there will be a Senate inquiry into the Amendment Bill and that the proposed changes will be reviewed as part of the “Productivity Commission review of the workplace relations framework” that is scheduled to commence this year.
The Bill is unlikely to be passed until after 30 June 2014, when the composition of the Senate changes and the Government has better prospects of securing passage of the legislation.
The content of this publication is for reference purposes only. It is current at the date of publication. This content does not constitute legal advice and should not be relied upon as such. Legal advice about your specific circumstances should always be obtained before taking any action based on this publication.