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Workplace Relations Amendment (Prohibition of Compulsory Union Fees) Bill 2001

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1998-1999-2000-2001

 

 

 

 

 

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

WORKPLACE RELATIONS AMENDMENT (PROHIBITION OF COMPULSORY UNION FEES) BILL 2001

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Employment,

Workplace Relations and Small Business, the Honourable Tony Abbott MP)



WORKPLACE RELATIONS AMENDMENT (PROHIBITION OF COMPULSORY UNION FEES) BILL 2001

 

OUTLINE

 

This Bill will amend the Freedom of Association provisions in Part XA of the Workplace Relations Act 1996 (WR Act) to prevent the inclusion of clauses in certified agreements which purport to require payment of fees for the provision of bargaining services, and prohibit action by unions to collect fees which have not been agreed in writing in advance.

 

Part XA of the WR Act will be amended to prohibit:

 

  • unions and employer organisations from requiring non-members to pay fees for “bargaining services”, except where an employee has agreed in writing to pay a fee in advance of the bargaining services being provided (such a fee is defined in the Bill as a “non-compulsory fee”); and

 

  • certain discriminatory or injurious conduct towards a person, because he or she refused to pay a fee claimed by a union for bargaining services, or because he or she has paid, or proposes to pay a non-compulsory fee; and

 

  • unions and employer organisations from encouraging or inciting others to take discriminatory action against a person because he or she refused to pay a fee claimed by a union for bargaining services, or because he or she has paid, or proposes to pay a non-compulsory fee.

 

In addition to prohibiting conduct under Part XA, an effect of these amendments would be that fees for bargaining services can not be included in certified agreements (by the operation of subsection 170LU(2A)), and any such clauses in existing certified agreements can be removed by the Australian Industrial Relations Commission (the AIRC) under section 298Z (which provides for the removal from certified agreements of “objectionable provisions”).  Subsection 170LU(2A) provides that the AIRC must refuse to certify an agreement if satisfied that it contains provisions that would require or permit (or have the effect of requiring or permitting) conduct that would contravene a provision of Part XA of the WR Act.  As a result of these proposed amendments, the AIRC would be required to refuse to certify an agreement if satisfied that it contained a provision requiring or purporting to require people who were not members of an industrial association to pay a fee to an industrial association for bargaining services.

 

These amendments are intended to counteract an emerging practice whereby certain trade unions are seeking to use the workplace relations system to create an obligation on non-member employees to pay a fee (without the employee’s consent) for services in relation to the negotiation of certified agreements.  Last year the Australian Council of Trade Unions adopted a policy that non-union members should be charged on a fee-for-service basis where ever they benefit from union activity, and that this should be reflected in bargaining agents fee clauses in agreements. 

 

The Government considers that such arrangements, in the absence of individual employee consent, amount to compulsory union fees.  Such clauses typically place an obligation upon the employer to inform employees that a fee for bargaining services is payable to the union.  The clauses purport to place an obligation on employees to pay the fee to the union.  The amount of the fee varies between being equivalent to, and significantly in excess of, annual union membership dues. 

 

Union moves to have such clauses included in certified agreements have recently intensified following a decision of the AIRC, currently under appeal, which found that such clauses were not able to be removed from certified agreements as “objectionable provisions” under section 298Z of the WR Act despite finding that these clauses amount to coercion of non-members to join the relevant union ( Employment Advocate re Accurate Factory Maintenance Labour Hire Enterprise Agreement 2000-2003 and other Agreements (PR900919, VP McIntyre, 9 February 2001).  The Government considers that, in the absence of individual agreement, such clauses are contrary to the freedom of association principles that underpin the current workplace relations framework.  Accordingly, such clauses should not be able to be included in certified agreements and should not be able to be sought from non-union members in the absence of prior individual agreement. 

 

The amendments proposed by this Bill would apply equally to non-member service fees imposed by trade unions or by industrial associations of employers.

 

 

FINANCIAL IMPACT STATEMENT

 

There will be no significant impact on Commonwealth expenditure.

 

 

 

 

 



NOTES ON CLAUSES

 

Clause 1 - Short Title

 

1.         This is a formal provision specifying the short title of the Act as the Workplace Relations Amendment (Prohibition of Compulsory Union Fees) Act 2001.

 

Clause 2 - Commencement

 

2.         This clause provides that the provisions of the Act will commence on the 28 th day after receiving Royal Assent.

 

Clause 3 - Schedules

 

3.         This clause provides that an Act that is specified in a Schedule is amended as set out in that Schedule, and any other item in a Schedule operates according to its terms.

 



SCHEDULE 1 - AMENDMENTS ABOUT FEES

 

1.1                 This Schedule would amend the Freedom of Association provisions in Part XA of the Workplace Relations Act 1996 (WR Act) to ensure that:

 

§   industrial associations cannot demand fees from non-union members for the provision of services relating to certified agreements, unless an agreement in writing was made prior to the provision of such services; and

 

§   certain discriminatory conduct relating to decisions to pay or not pay such fees is prohibited.

 

 

Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - Subsection 298B(1)

Item 2 - Subsection 298B(1)

 

1.2       These items would insert new definitions into subsection 298B(1) of the WR Act.  Section 298B sets out a number of definitions that are specific to Part XA.

 

1.3       Item 1 would define the term “bargaining services” (which are services in respect of which a “non-compulsory fee” may be agreed) to mean services provided by or on behalf of an industrial association (i.e. an employer or employee association) in relation to the negotiation, making, certification, extension, variation or termination of a certified agreement under Part VIB of the WR Act.

 

1.4       Item 2 would define the term “non-compulsory fee” as being a fee that a person has agreed in writing to pay before bargaining services are provided by an industrial association.

 

Item 3 - At the end of subsection 298L(1)

 

1.5       Subsections 298K(1) and (2) of the WR Act prohibit employers and others from engaging in certain discriminatory conduct where the conduct is engaged in for a prohibited reason, or for reasons that include a prohibited reason.  Subsection 298L(1) lists the reasons which are not allowed to be the basis for conduct listed in subsections 298K(1) and (2).

 

1.6       Item 3 would expand the prohibited reasons listed in subsection 298L(1) of the WR Act to include two new reasons relating to conduct taken against employees or independent contractors in respect of fees for bargaining services.

 

1.7       Proposed paragraph 298L(1)(o) would include as a new prohibited reason that an employee or independent contractor proposes to, has agreed to, or has paid a non-compulsory fee for services.

 

1.8       Paragraph 298L(1)(p) includes as a new prohibited reason that an employee or independent contractor refuses to pay or agree to pay a fee relating to the provision of bargaining services (whether of not the fee is a non-compulsory fee).

 

Item 4 - At the beginning of section 298Q

 

1.9       Section 298Q prohibits certain conduct by industrial associations.  The section prohibits an industrial association from taking or threatening to take action which has the effect of prejudicing a person in his or her employment or possible employment in order to coerce the person to join in industrial action or to dissuade or prevent the person from seeking a secret ballot under an industrial law.

 

1.10     Item 4 proposes to include an additional prohibition on industrial associations acting against employees, independent contractors and others.

 

1.11     Proposed subsection 298Q(2) would prohibit industrial associations from taking or threatening to take action that has the effect of prejudicing a person in his or her employment or possible employment, and from advising, encouraging or inciting another person to take such action, if the reason for the action or conduct is that the person either proposes to, has agreed to, or has paid a non-compulsory fee, or refused to pay or agree to pay a fee (whether or not a non-compulsory fee) in exchange for the provision of bargaining services.

 

Item 5 - After section 298Q

 

1.12     Item 5 would insert a new section following section 298Q.

 

1.13     Proposed subsection 298QA(1) would prohibit an industrial association from demanding or receiving fees for bargaining services from a person who is not a member of the association.

 

1.14     Proposed subsection 298QA(2) would provide exceptions to the general rule in subsection 298QA(1).  Industrial associations would not be prohibited from demanding or receiving fees that are either “non-compulsory fees” (the proposed definition of this term is contained in Item 2 of this Schedule), or membership dues from a person joining the association.

 

1.15     Proposed subsection 298QA(3) would define the term “demand” to include purported demands, and actions that have the effect of demanding or which purport to have that effect.

 

Item 6 - At the end of subsection 298S

 

1.16     Section 298S prohibits certain direct and indirect discriminatory conduct against independent contractors by industrial associations. 

 

1.17     The section uses the concept of an “eligible person” to refer to an independent contractor.  The term is defined in subsection 298S(1).

 

1.18     Subsection 298S(2) prohibits an industrial association from advising, inciting or encouraging another person to take discriminatory action against an eligible person because the eligible person is not a member of an industrial association. 

 

1.19     Under subsection 298S(2) an industrial association is also prohibited from taking industrial action against an employer to coerce the employer to take discriminatory action against an eligible person because the eligible person is not a member of an industrial association.

 

1.20     Under subsection 298S(2) an industrial association is also prohibited from taking industrial action directly against an eligible person to coerce him or her to join an industrial association.

 

1.21     Item 6 would insert two additional subsections into section 298S.  Proposed subsection 298S(3) would prohibit an industrial association from engaging in conduct of the type outlined in subsection 298S(2) for new “prohibited reasons”.  Proposed subsection 298S(4) would define the new “prohibited reasons” for the purposes of subsection 298S(3).  The new prohibited reasons are:

 

  • an eligible person proposes to, has agreed to, or has paid a non-compulsory fee; and

 

§   an eligible person refuses to pay or agree to pay a fee relating to the provision of bargaining services (whether or not a non-compulsory fee).

 

Part 2 - Application provisions etc.

 

1.22     Part 2 contains application provisions for the amendments contained in Part 1 of the Schedule.

 

Item 7 - Definition

 

1.23     Item 7 would define the term “Principal Act” for the purposes of the Part as the WR Act.

 

Item 8 - Application of Part 1

 

1.24     Subsection 170LU(2A) provides that the Commission must refuse to certify an agreement if the Commission is satisfied that it contains provisions that would require or permit (or have the effect of requiring or permitting) conduct that would contravene a provision of Part XA of the WR Act. 

 

1.25     Item 8 would provide that, for the purposes of section170LU (which relates to the certification of agreements by the Commission), the amendments proposed by Part 1 of the Schedule have effect from commencement, irrespective of whether an application for certification of an agreement was made before or after commencement of this Act.

 

Item 9 - Application of section 298QA of Principal Act

 

1.26     Section 298QA (to be inserted by Item 5) applies to demands or receipts of fees on or after the commencement of Item 5.  (New section 298QA would prohibit an industrial association from demanding and receiving payment of fees for bargaining services from people who are not members of the association, except where the fees concerned are non-compulsory fees or membership fees.)

 



Item 10 - Payments received before commencement

 

1.27     Item 10 would clarify that the amendments proposed by Part 1 of the Schedule do not affect payments received by industrial associations before commencement of the Part.