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Workplace Relations and Other Legislation Amendment (Small Business and Other Measures) Bill 2001

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1998-1999-2000-2001

 

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

WORKPLACE RELATIONS AND OTHER LEGISLATION AMENDMENT (SMALL BUSINESS AND OTHER MEASURES) BILL 2001

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Employment, Workplace Relations

and Small Business, the Honourable Tony Abbott MP)

 

 

 



WORKPLACE RELATIONS AND OTHER LEGISLATION AMENDMENT (SMALL BUSINESS AND OTHER MEASURES) BILL 2001

 

 

OUTLINE

 

 

The Bill proposes amendments to the Workplace Relations Act 1996 (WR Act) and the Trade Practices Act 1974 .  The legislative reforms are designed to ensure that the workplace relations system better meets the needs and circumstances of small business.  A vibrant and innovative small business sector is crucial to Australia’s economic growth and social welfare. 

 

Key reforms to be implemented by the Bill are as follows.

 

·         The Bill proposes new objects for the WR Act to require the Australian Industrial Relations Commission (the Commission) to take into account the circumstances of employers and employees in small business in the exercise of its powers, including through appropriate changes to its principles, procedures and rules (Schedule 1). 

 

·         The Bill proposes that employees (other than apprentices and trainees) in small businesses would not be entitled to apply for a remedy in respect of harsh, unjust or unreasonable termination (‘unfair dismissal’) under the WR Act.  This exclusion would apply to those employees who are first employed in a small business after the date on which the amendment implementing the exclusion commences.  The Bill also proposes to allow the Commission to reject some unfair dismissal applications by employees in small businesses, without the employer or employee having to attend a hearing.  This could occur where the Commission is satisfied that the application is outside the Commission’s jurisdiction, or where the Commission is satisfied that the application is frivolous, vexatious or lacking in substance (Schedule 2). 

 

·         The Bill proposes that procedures for Australian Workplace Agreements (AWAs) and certified agreements would be significantly simplified (Schedules 3 and 4, respectively). 

 

·         The Bill proposes amendments to section 87 of the Trade Practices Act 1974 to allow the Australian Consumer and Competition Commission to bring representative actions in respect of contraventions of sections 45D and 45E of the Trade Practices Act (Schedule 5). 

 

·         The Bill proposes to restrict the ability of unions to rope small business employers into federal awards.  Only those small business employers with at least one employee who is a member of the union issuing the log of claims would be able to be roped-in to a federal award.  Unions would have to provide employers with prescribed information about the roping-in process and the rights an employer has to defend itself against the log of claims.  Also, the Commission would be required to enquire into the views of small business employers affected by being roped into a federal award, rather than attending only to the views of employers who appear or are represented at such hearings (Schedule 6).

 

·         The Bill proposes reforms to union right of entry to businesses.  Right of entry would be conditional on a written invitation from a union member employed in the business, and the provisions of 5 working days notice to the business.  Employers and occupiers would be given the right to propose an alternative date, within 5 working days of the originally proposed date.  For union right of entry for discussion purposes (ie recruitment purposes), the written invitation would only authorise one entry every 6 months (Schedule 7). 

 

·       The Bill proposes to protect the status of independent contractors by preventing federal awards and certified agreements from restricting the use of contractors.  There would be an exception for award provisions in the textiles, clothing and footwear industry (Schedule 8).

 

 

FINANCIAL IMPACT STATEMENT

 

The Bill has no financial impact on the Commonwealth Budget.

 

 

 



REGULATION IMPACT STATEMENT

 

Amend the Objects of the Workplace Relations Act 1996 to Take Account of the Circumstances of Small Business Employers

 

 

Problem:

 

Time for Business , the 1996 report of the Small Business Deregulation Task Force, identified that small business found that the Australian Industrial Relations Commission was not user friendly and that its rules and procedures were not responsive to its needs.  The formal nature of the Commission’s practices, proceedings and documentation made it difficult to participate in the Commission’s processes.  In addition, little or no account was taken of the circumstances in which small businesses found themselves as employers.  Unlike large employers, they did not generally have regular access to legal expertise in fields ranging from common law to workers compensation when dealing with employment related matters in the workplace.

 

This lack of access is partly because many small businesses are not members of registered employer organisations.  Thus, they are not represented in the Commission’s hearings and cases.  They also do not receive the assistance that employer organisations provide, for example, assistance with the requirements for agreement-making, advising of award variations and assistance in interpreting awards.  As a result, many small businesses do not have the knowledge or opportunity to adapt award provisions to the circumstances of their business and are not able to influence Commission proceedings.

 

Current Situation:

 

The Commission is not required to specifically take into account the needs and circumstances of small business in its hearings or in establishing its rules and procedures.  This situation is compounded by the absence of an organisation specifically representing the views and interests of small business in Commission cases which are of particular importance to small business such as award Safety Net Adjustment (SNA) cases, other test cases such as the recent case about the employment of casuals in the Metal Industry Award and certain roping-in cases.

 

Objectives:

 

The Government’s objective is to increase the extent to which the Commission takes into account the circumstances of small business in its decisions and in its rules and procedures.

 

The proposed amended objects address the widespread recognition that the Commission needs to be more widely accessible and easier to use by all participants, especially in the small business sector. 

 

Option:

 

Amend the principal object of the Workplace Relations Act 1996 (WR Act) and the objects of particular parts of the Act, for example Part VI ‘Dispute Prevention and Settlement’, to include reference to the special circumstances of small business, and in particular:

 

  • require the Commission to take into account the circumstances of employers and employees in small business in performing its functions and in exercising its powers under the Act (including through appropriate changes to its principles, procedures and rules).

 

Within eight months after the commencement of the Bill:

 

  • the President of the AIRC must complete a review of the Rules of the Commission made under section 48 of the WR Act (having regard to the amendments of that Act proposed by this Bill); and

 

  • the President must give the Minister a written report about the review; and

 

  • the President must, under that section, make any new Rules of the Commission, or make any variations of the existing Rules of the Commission, that the President considers appropriate as a result of the review.

 

Impact analysis (cost and benefits) of the option:

 

The principal object of the WR Act and the objects of particular parts of the Act embody the overarching policy principles on which the statutory framework for workplace relations in the federal jurisdiction is based. 

 

While reflecting the refocused role for the AIRC in a decentralised workplace relations system, the objects, because they are not detailed and prescriptive in form, allow the Commission discretion in performing its statutory role in relation to the individual matters coming before it.  They do not impose detailed requirements which must be precisely applied in specific cases. 

 

The objects, as proposed to be amended, would encourage the Commission to take account of the circumstances of small business employers and employees in the exercise of its powers (including where appropriate modifying its practices and procedures to make them less burdensome and complex for small business employers) but how best this objective is to be fulfilled in particular instances and in relation to particular issues, such as  measures  to make  small businesses more aware of AIRC decisions and procedures, would primarily be a matter for the Commission’s own judgment.

 

(a)     Effect on employers

 

The proposal is targeted at small businesses in the federal jurisdiction.  It is estimated that this constitutes approximately 180 000 small businesses.

 

The proposal should assist small business as a result of the Commission’s taking more account of small business circumstances in its decisions, rules and procedures.  Amendments along these lines would require the Commission to review its rules and procedures to assist small businesses involved in Commission proceedings.  They would also require the Commission to take more account of small business needs in test cases and Safety Net Adjustment Cases.  This may assist in gaining small business exemptions such as occurred in the Termination, Change and Redundancy test case in 1984 or in gaining Commission acceptance of arguments to amend the Incapacity to Pay Principle in Safety Net Adjustment Cases.  This should have indirect, beneficial effects on small business activity. 

 

For example, at present the only formal mechanism available to ameliorate the adverse labour cost effects of arbitrated Safety Net Adjustments on small businesses is the AIRC’s economic Incapacity to Pay wage fixing principle.  Since the introduction of this principle in 1986 employers have had only very limited success in gaining relief from arbitrated labour cost increases, causing the Government to support the modification of the principle in three successive Safety Net Review submissions after 1996.  For the 1999 Safety Net Review decision, the Commonwealth indicated that some 21.2 per cent of firms employing fewer than twenty persons were operating at a loss and that safety net adjustments impacted heavily on businesses in this category.  The Commonwealth proposed modifications to the incapacity to pay principle for respondents or groups of respondents who were experiencing hardship but who in the past had considered the tests specified in the principle to be set at a level which did not warrant the considerable expense associated with mounting a case.

 

I n its decision (Print R1999) the AIRC decided not to modify the Incapacity to Pay principle as suggested by the Commonwealth.  However, the AIRC amended the principle to recognize that the impact of an increase in labour costs on employment at the enterprise level is a significant factor to be taken into account in assessing the merit of any application.  However, it is DEWRSB’s understanding that there has not been an economic incapacity case pursued in the federal jurisdiction since this decision.

 

The Commonwealth remains of the view that the hurdles set by the Commission in considering incapacity to pay applications are set too high.  Amending the objects of the WR Act to encourage the Commission to take account of the circumstances of small business employers would serve a useful purpose if it made the Commission more likely to consider modifying the Incapacity to Pay principle to make it more accessible to applications from small businesses. 

 

(b)    Effect on employees

 

This proposal would potentially impact on the employees of small businesses in the federal jurisdiction.  It is estimated that around 35 per cent of employees in businesses with less than 20 employees are covered by the federal system (around 770 000 employees in 1999-2000).

 

To the extent that the Commission’s taking more account of the circumstances of small business is reflected in an increase in exemptions such as occurred in the Termination, Change and Redundancy test case or could occur in more successful use of incapacity to pay arguments in Safety Net Adjustment cases, employees in financially vulnerable small businesses may find it harder to access standard redundancy pay provisions and safety net wage increases provided for other employees.  The overriding intent of such exemptions, however, would be to protect the employment of the workers concerned .

 

As indicated above, the AIRC’s wage principles now formally recognise that the impact of an increase in labour costs on employment at the enterprise level is a significant factor to be taken into account in assessing the merit of an incapacity to pay application in relation to SNAs.  The Commission’s TCR Test Case standard was framed with a view to minimising any differential  cost impact on individual enterprises with consequent adverse effects on employment and the viability of vulnerable companies.  In relation to redundancy pay, the Commission in 1984 provided scope for employers to apply for exemption on the grounds of their employing less than 15 employees.  Employers who employed more than 15 employees could gain a variation in the general severance pay prescription provided they fulfilled an incapacity to pay test. 

 

            (c) Effect on consumers and Australian economy

 

No direct effects on consumers.  Any indirect beneficial effects on small business activity would also be beneficial to the Australian economy.

 

Consultation:

 

Over the last six months the Minister for Small Business has undertaken formal and informal consultations with small business operators, including over 30 formal roundtable meetings throughout Australia.  No specific consultation on the above option has occurred.

 

Implementation and Review:

 

The option would require amendments to the WR Act.  DEWRSB and the Australian Industrial Registry would monitor and evaluate the effect of such legislative change.

 

As a transitional provision, the President of the Commission would be required to undertake a review of the rules of the Commission, in the light of the changes to the Act, in particular the changes to the objects of the Act, and provide a report to the Minister within an eight month period after the commencement of the Bill, as to the outcome of the review of the Commission’s rules.  The President would be expected to consult with small business employers and employees in the process of the review. 

 



REGULATION IMPACT STATEMENT

 

Unfair Dismissal - Commission Able to Reject Claims Without Hearings

 

 

Problem:

 

The defence of clearly unmeritorious unfair dismissal claims is particularly burdensome for small businesses.  Regardless of the merit of the claim a small business is likely to have to seek legal advice and attending a Commission hearing, which particularly for small businesses in regional and rural Australia, can be extremely difficult and costly given that the location of proceedings is usually in capital cities

 

Anecdotal evidence presented by employers and employer groups to the Senate Employment, Workplace Relations, Small Business and Education Legislation Committee suggests that businesses commonly make payments to terminated employees to avoid contesting an unfair dismissal claim, regardless of the merit of the claim.  For example in evidence to the Committee’s inquiry into the Workplace Relations Amendment (Unfair Dismissals) Bill 1998, Mr Grant Poulton from Australian Business Limited stated:

 

Of the 248 matters that we dealt with [during 1998] I would estimate that at least three quarters were settled without regard to the question of merit, of relative strength.  They were settled on the basis that - and it is good, commercial, pragmatic advice - it was going to cost X dollars; it could be got out of for a figure somewhat less than X so settle it.  Colloquially it is known as ‘piss off’ money.  You get an awful lot of applicants who will try it on in the sure and certain knowledge that they will obtain something. [1]

 

Moreover, the increased use of legal representatives by applicants to unfair dismissal claims has increased the impetus for small employers to settle claims, rather than defend them.  In the Senate Committee inquiry into the Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999, the witness appearing for the Victorian Automobile Chamber of Commerce observed that:

 

Small businesses such as those that we represent generally are employers who work their way up through the trades themselves.  They run a small shop, perhaps a panel beating shop or something like that, where they are actually out there doing the work alongside their staff.  There really is no-one there to run or manage the business while they are absent, so they are really keen to resolve the matter as soon as possible.  It usually involved settling on something, and it usually means settling on a sum, particularly if those applicants are represented by consultants or lawyers, to the satisfaction that they will be able to pay their legal fees as the first priority, and then receive a minimum of whatever that may be. [2]

 

Current Situation:

 

The Australian Industrial Relations Commission (the Commission) has no discretion to reject an unfair dismissal claim, once it is lodged, without holding at least one hearing which the employer or their representative is required to attend.

 

Objectives:

 

The Government’s objective is prevent small business employers having to attend Commission hearings to defend unfair dismissal applications which can clearly be determined, on the basis of documents provided to the Commission, to be unmeritorious or not within the Commission’s jurisdiction.

 

Option:

 

A Registrar or a member of the Commission would be given the power to decline to deal with unfair dismissal applications against small business employers, but not unlawful dismissal applications, eg.  dismissal for a discriminatory reason, when they are first lodged. 

 

The Registrar or Commission would be able to seek further particulars from an applicant and a response from the small business employer by correspondence, rather than having the parties appear in person.  Claims that are then determined to be clearly not receivable or unmeritorious could be rejected without any hearings being convened.

 

This would complement the small business unfair dismissal exclusion, by providing a simple means for rejecting claims by excluded employees.  For applications by small business employees who are not exempt (apprentices, trainees, or employees employed before the commencement of the exclusion), the Registrar’s or Commission member’s discretion to dismiss an application could use a formula such as, being reasonably satisfied the application is frivolous or vexatious; or that the application is misconceived or lacking in substance.

 

Impact analysis (costs and benefits) of the option:

 

(a) Effect on employers

 

It is broadly estimated that the proposal would potentially affect around 170 000 businesses in the federal jurisdiction.  The number of unfair dismissal application by employees of small business in the federal jurisdiction has averaged around 7 700 applications in the past four years.

 

Reducing the number of clearly unmeritorious claims which small businesses have to defend by engaging legal advice and attending Commission hearings will reduce costs and inconvenience for some of the small businesses subject to unfair dismissal applications.  It will also be of some assistance to some of those small businesses which make payments to dismissed employees to avoid a threatened unfair dismissal claim.

 

(b) Effect on employees

 

It is broadly estimated that the proposal could potentially affect around 685 000 employees a year, that is, this is the number of employees in small business that are estimated to be currently able to seek a remedy for unfair dismissal in the federal jurisdiction.

 

(c)   Effect on consumers and Australian economy

 

To the extent that the prospect of unmeritorious unfair dismissal applications discourage recruitment in small business, an exemption would increase small business activity and employment.  There would be no direct effect on consumers.

 

Consultation:

 

Over the last six months, the Minister for Small Business, the Hon Ian Macfarlane MP, has undertaken formal and informal consultations with small business operators at which the impact of workplace relations regulation on small business operators has been broadly identified by employers.  No consultation on the specific proposal above has occurred.

 

Implementation and Review:

 

The option would require amendments to the Workplace Relations Act 1996 .  DEWRSB would monitor and evaluate the effect of such legislative change.

 

 



REGULATION IMPACT STATEMENT

 

Simplified Procedures for Australian Workplace Agreements

 

 

Problem:

 

The current procedures and tests associated with formalised agreements can be too complex and costly.  Potential use of individual Australian Workplace Agreements (AWAs) by small business is discouraged by technicalities.  There are numerous steps to be undertaken as a prerequisite for the approval of an AWA.  The procedures are seen as involving a high degree of formality, and some parties (particularly small business employers without in-house access to specialised knowledge and assistance) are discouraged from negotiating AWAs. 

 

Concerns have also been expressed about the fact that an AWA cannot come into effect as soon as the parties have reached agreement.  Small business has been particularly frustrated by the delays which occur even in the case of new employees.  At a minimum, employers cannot commence new employees on AWAs until a week has elapsed since the job offer. 

 

Employers and employees who are keen to use an AWA often inadvertently breach the required period which must be observed between consideration of an AWA, and when it can be signed.  Of AWAs refused by the Employment Advocate (EA), the highest proportion (61 per cent as at August 2000) are due to the employee prematurely signing the AWA.  The current requirement to offer AWAs in the same terms to all comparable employees at a workplace has also been criticised as it precludes employers being able to take into account an individual’s performance in determining the conditions they are to be offered.  This is incompatible with the concept of individual agreements.

 

Current Situation:

 

Existing agreement making provisions for AWAs mandate:

 

·       a 2-stage process, whereby AWAs must be filed with the Employment Advocate, after which a filing receipt can be issued (typically takes 3 days) and then approved (typically a turnaround time of 20 days or less), provided various statutory requirements and tests have been met;

 

·       an employee must be given a copy of the AWA at least the required number of days before signing the AWA (5 days for a new employee and 14 days for an existing employee);

 

·       an AWA for an existing employee comes into operation when it is approved by the Employment Advocate or on any later date specified in the AWA.  An AWA for a new employee comes into operation when the Employment Advocate issues a filing receipt for the AWA [3] , on the date specified in the AWA, or when the employment commences, whichever is the latest;

 

·       the Employment Advocate is not currently empowered to apply for a penalty arising from any breaches of an AWA or recover underpayments; and

 

·       in the case where an employer has not offered an AWA in the same terms to all comparable employees (ie employees engaged in the same kind of work), the employer must not have acted unfairly in failing to do so.

 

To date, uptake of AWAs has been limited.  While the monthly approval rate for AWAs by the OEA is now in the vicinity of 5,000 per month, and altogether more than 170,00 AWAs have been made since the introduction of the new workplace relations legislation, this accounts for a very small number overall of employees in Australia.  The May 2000 ABS Survey of Employee Earnings and Hours estimates AWAs cover only 1 per cent of employees in Australia.  Another 0.8 per cent of employees are covered by registered individual agreements in State jurisdictions.  The total proportion of employees on individual agreements (40 per cent) includes a substantial proportion of employees paid at overaward rates, as well as those on informal individual agreements.  Where employees are paid at overaward rates, arrangements may be less flexible as the award cannot be displaced.  Therefore, simplifying AWAs may provide a better avenue for employers and employees who  have traditionally relied on such overaward arrangements.

 

Objectives:

 

The Government’s objectives are to:

 

·       simplify and consolidate the procedures for making AWAs - so that it becomes a one-stage, more clearly understood process;

 

·       remove periods before an AWA can come into effect:

 

o    however, this would be counterbalanced by allowing employees a cooling off period during which they could withdraw from the AWA;

 

·       encourage larger uptake of AWAs; and

 

·       increase scope to tailor AWAs to individual employees. 

 

Option:

 

The following measures are intended to achieve these objectives:

 

·       simplification of the approval process by consolidating the existing filing and approval requirements into a one step process for approval by the Office of the Employment Advocate (OEA);

 

·       enabling AWAs to take effect from the day of signing;

 

·       allowing employees to sign AWAs at any time after receiving a copy of the information statement from the OEA and an explanation of the effect of the agreement;

 

o    with provision for an employee party to an AWA to withdraw consent to the AWA within a cooling-off period; and

 

·       removal of the requirement to offer identical AWAs to comparable employees. 

 

Impact analysis (costs and benefits) of the option:

 

(a)    Effect on employers

 

The number of businesses with access to AWAs, that is constitutional corporations or those operating in Victoria or a Territory is broadly estimated to be 340 000. 

 

All the proposals would make it easier for employers to make AWAs, and allow them to take effect immediately.  Confusion would be reduced  and the process would become much more streamlined.  Employers would also have more discretion to offer different AWAs to each of their employees.  Individual productivity benefits associated with displacing awards would begin to be felt, but could not be isolated from other factors or separately quantified.

 

(b)    Effect on employees

 

The number of employees estimated to be employed in businesses which can make AWAs is around 6 ¼ employees or around 85 per cent of total non-farm employees.

 

Employees would be able to sign an AWA and start working under the new agreement immediately.  Lower paid employees would still be able to change their minds during the cooling off period and the OEA would be able to seek to recover any related underpayment on their behalf.  Existing statutory protections would be retained, and still apply, such as provisions to ensure the employee has been fully informed about the agreement and has received information from the OEA about the process, that the agreement is not discriminatory and that the employee genuinely consented to the agreement.  There would be more scope to make an agreement suited to an individual’s needs, such as family responsibilities.

 

(c) Effect on Consumers and Australian Economy

 

The effect of the proposal would be to further encourage take-up of AWAs amongst all businesses, and should enhance productivity growth as working arrangements can be better tailored within an enterprise to meet the needs of each employee as well as that of the business. 

 

Consultation:

 

Over the last six months, the Minister for Small Business, the Hon Ian Macfarlane MP, has undertaken formal and informal consultations with small business operators at which employers have broadly identified the impact of workplace relations regulation on small business operators.  No recent direct consultation on the above proposals has occurred. 

 

Implementation and Review:

 

All of the proposals would require amendments to the Workplace Relations Act 1996 .  DEWRSB and the OEA would monitor and evaluate the effect of such legislative change.

 

 



REGULATION IMPACT STATEMENT

 

Simplified Procedures for Certified Agreements

 

 

Problem:

 

The current procedures for formalising certified agreements (CAs) are perceived to be too time consuming, complex and costly and unnecessarily formal, particularly for small business.  The Australian Industrial Relations Commission (AIRC) has an average turnaround time for certifying agreements of 28 days. 

 

Another main concern is that parties currently attend hearings of the AIRC for agreements to be certified.  This means that parties must wait for their application to be listed for hearing and then take time away from their workplaces to participate in hearings in circumstances where the applications could have been dealt with expeditiously and with minimal cost on the basis of written applications only.

 

Current Situation:

 

Part VIB of the Workplace Relations Act 1996 (WR Act) provides for the making of collective agreements and their certification by the AIRC after considering them against defined criteria. 

 

The legislation currently specifies that employees must have a proposed agreement available to them for at least 14 days before they are able to approve the agreement.  An employer must then lodge the agreement for certification within 21 days of approval of the agreement by a valid majority of the employees who are to be covered by the proposed agreement.

 

There is no current statutory requirement for the AIRC to hold formal hearings for certification of agreements but it has become practice and it is understood the AIRC is currently opposed to changing this practice.  There is also no current provision for electronic lodgement of documents.  They must be provided in hard copy to the AIRC to commence the certification process.

 

Agreements made since the introduction of the new agreement making provisions under the 1996 legislation now account for over 70 per cent of all formalised federal agreements made (since the introduction of formalised federal agreements in October 1991 and for which data has been collected).  This increase in the number of agreements certified under the 1996 legislation demonstrates the effectiveness of the 1996 provisions in increasing access to agreements, but there is still considerable potential to further expand uptake of agreements. 

 

The ABS Survey of Employee Earnings and Hours for May 2000 shows 36.7 per cent of employees in Australia were paid by collective agreement.  21.7 per cent of all employees are covered by a Federal agreement.  The remaining employees are covered by awards (23.3 per cent) or individual agreements (which includes a very small proportion of registered individual agreements, with nearly all employees in this category on informal individual agreements, where these may also account for employees on over-award payments).

 

Objectives:

 

The Government’s objectives are to make agreement-making at the workplace or enterprise level easier and more widely accessible, and to reduce the formality and cost involved in having an agreement certified.  These issues can be significant for workplaces not currently covered by an agreement and also for those workplaces where the parties wish to replace or otherwise update their existing agreement.  Formalised agreements are associated with more direct employer and employee relationships which in turn are considered to provide more scope to enhance productivity growth at the enterprise level.

 

Option:

 

The following measures improve accessibility and the attractiveness of CAs for all business:

 

·         approval and variation requirements for making CAs in all business would be streamlined for example, by merging the current CA requirements about consultation and lodgement, along the lines of the proposal to consolidate the existing filing and approval processes for AWAs; and

 

·         CAs could be approved on the basis of documents submitted to the Commission without the need for formal hearings unless such a hearing was requested by the employer or the employees or a union representing employees in the negotiation of the CA.

 

Impact analysis (costs and benefits) of the option:

 

(a)    Effect on employers

 

It is estimated that around 365 000 businesses have access to federal certified agreements.

 

The proposals would make it easier for employers to make federal CAs, and reduce “costs” to the business through allowing for electronic lodgement of relevant documents.  In particular, it would remove the current disincentive for small business arising from the need to attend a formal hearing before an industrial tribunal as part of the certification process. 

 

(b)    Effect on employees

 

It is estimated that businesses with access to federal certified agreements would employ around 86.5 per cent of total non-farm employees (around 6.4 million employees).

 

Employees would have greater opportunity to make formal collective agreements, and introduce more flexible working arrangements which can accommodate their particular circumstances, such as family responsibilities.

 

(c) Effect on Consumers and Australian Economy

 

The effect of the proposal would be to further encourage take-up of CAs amongst all businesses, and should enhance productivity growth as working arrangements can be better tailored for each enterprise to meet the needs of its employees as well as that of the business. 

 

Consultation:

 

Over the last six months, the Minister for Small Business, the Hon Ian Macfarlane MP, has undertaken formal and informal consultations with small business operators at which employers have broadly identified the impact of workplace relations regulation on small business operators.  No recent direct consultation on the above proposals has occurred. 

 

Implementation and Review:

 

The proposals would require amendments to the Workplace Relations Act.  DEWRSB would monitor and evaluate the effect of such legislative change. 

 

 



REGULATION IMPACT STATEMENT

 

Secondary Boycotts - Representative Actions by Australian Competition and Consumer Commission

 

 

Problem:

 

The problems addressed by this Bill are deficiencies in the Trade Practices Act 1974 (the TPA) compliance and redress mechanisms and barriers to the institution of proceedings under the TPA.

 

Current Situation:

 

At present, section 87 of the TPA allows the Australian Consumer and Competition Commission (ACCC) to bring representative actions in respect of contraventions of all of Part IV of the TPA, except for sections 45D and 45E.

 

Objective:

 

The objective of the proposed amendments is to improve the enforcement aspects of the regulatory regime contained within the TPA and address the shortcomings in present legal remedies to encourage compliance with the obligations under the TPA.

 

Options:

 

Option 1 - No Action

 

This option would involve no change to the current regulatory regime.

 

Option 2 - Legislative Amendments

 

This option would involve a series of legislative amendments to be made to the TPA to address the identified problems.

 

Impact analysis (costs and benefits) of each of the options:

 

Option 1 - No action

 

The Australian Law Reform Commission (ALRC) in Australian Law Reform Commission Report No 68: Compliance with the Trade Practices Act 1974 (1994), documented that business (particularly small business) and consumers are unable to access appropriate legal remedies under the TPA.  The ALRC noted that the cost of bringing proceedings was a substantial impediment to bringing an action.

 

If no action is taken, the difficulties associated with accessing legal remedies under the TPA will remain.  Where the TPA has been contravened and private individuals are unable to commence their own legal proceedings (and thereby punish contravening parties for their misconduct), the ACCC will be required to carry a greater share of the enforcement burden and associated costs.  Maintenance of the status quo will mean that businesses (particularly small business) and consumers will continue to be denied the protection purported to be offered by the TPA and hence will bear the costs of the loss or damage produced by the unlawful conduct.  This may be particularly costly for small businesses wishing to compete with businesses that successfully gain market share through unlawful conduct.  The flow-on from this is the creation of inefficient and uncompetitive markets, which will produce a negative result for the community generally. 

 

Option 2 - Legislative Amendments

 

Amendments would be made to section 87 of the TPA to allow the ACCC to bring actions for compensation or a representative action in respect of contraventions of sections 45D and 45E of the TPA

 

The general problem of access to legal remedies under the TPA would be addressed by ensuring that the ACCC has clear powers to enable it to bring representative proceedings on behalf of businesses and consumers.

 

Consumers and businesses that are presently unable to recover compensation for their loss would benefit from improved access to legal remedies.  This correction of market processes will produce a more competitive environment for business and hence enhance the welfare of the community. 

 

Consultation:

 

The proposed measures have been subject to broad consultation.  The amendments were originally contained within the Australian Law Reform Commission Discussion Paper 56: Compliance with the Trade Practices Act 1974 .  The submissions to this Paper were considered and a position developed and documented in the Australian Law Reform Commission Report No 68: Compliance with the Trade Practices Act 1974 .  

 

The ALRC consulted with peak business organisations, consumer groups, the judiciary, government departments, enforcement agencies and academia.

 

The former Minister for Customs and Consumer Affairs, the Hon Chris Ellison MP released the Legislative Outline: Amendments to the Trade Practices Act 1974: A Better Deal for Consumers and Small Business in September 1997.  This discussion paper drew on the recommendations for reform made by the ALRC.  The public submissions expressed general support for the legislative amendments proposed under Option 2 .

 

The proposed measures were also considered by the Joint Select Committee on the Retailing Sector, in its August 1999 report, Fair Market or Market Failure?   The Committee consulted with peak business organisations, enforcement agencies and government departments.

Treasury, the Attorney-General's Department, the Department of Prime Minister and Cabinet, the Department of Industry, Science and Resources, the Department of Transport and Regional Services, the Department of Finance and Administration and the Australian Competition and Consumer Commission have all been consulted. 

 

Conclusion and recommended option:

 

The preferred option is to amend the TPA to allow the ACCC to bring representative actions in respect of contraventions of sections 45D and 45E of the TPA.

 

If there is no action, then the current problems of business (particularly small business) and consumers being unable to access appropriate legal remedies under the TPA will continue.

 

Implementation and review:

 

Implementation of the preferred option will occur through this Bill.  The Government has informed the public of the intention to amend the TPA in the media.

As the TPA has fundamental effects on the business environment and establishes the parameters within which Australian business operates, it is subject to continuing evaluation and assessment by the Treasury to ensure its continued effectiveness.

 

 



REGULATION IMPACT STATEMENT

 

Constrain Roping-in of Small Business Employers to Federal Awards

 

 

Problem:

 

Small businesses can be roped-into federal awards without being fully aware of the processes involved and the impact that it will have on the business.  For example, there is a current claim by the Shop Distributive & Allied Employees’ Association (the SDA) to rope in tens of thousands of small Victorian retail businesses into a federal award.  Currently, these businesses (formerly covered by the Victorian state system before the Victorian Government referred most of its industrial relations powers to the Commonwealth) are covered by the legislated minimum conditions in Schedule 1A to the Workplace Relations Act 1996 (WR Act) which make no provision for a number of minimum entitlements common in federal awards such as overtime and penalty rates.  Thus a move to a federal award may have significant cost implications for many of the businesses concerned.

 

Many of the businesses covered by the roping-in claim by the SDA are not members of a registered employer organisation.  Most would not know what to make of the log of claims contained in the letter sent from the SDA to initiate the roping-in and dispute finding procedures before the Australian Industrial Relations Commission (the Commission).  They would not, for example, be aware that such logs are typically ambit in nature.  The majority of small businesses have been unrepresented in the Commission hearings which have been held to date and will have no opportunity to influence the Commission’s eventual decision.  While roping-in exercises on the scale of the SDA claim are unusual, even smaller scale claims are bewildering to most of the small businesses involved.

 

Current Situation:

 

Roping-in claims occur because federal awards do not operate on a common rule basis (except in the ACT and Northern Territory), that is, a business (other than a respondent organisation) must be individually named as a respondent to an award for the terms and conditions in the award to apply to the employees and employer in that business.  This is due to the limitation of the conciliation and arbitration power in the Constitution which underpins the Commission’s powers in the federal jurisdiction.  State awards do not suffer from this limitation and most operate on a common rule basis, that is, they apply across a sector or occupation within the state.  It is estimated that around 32 per cent of small businesses are covered by state jurisdictions around 35 per cent are covered by the federal jurisdiction and the remainder are not covered. 

 

If a union wants a federal award to apply to a business it must ‘rope’ the business into the award.  For this to happen the union must make a log of claims on the business, usually with a high degree of ambit in it (eg.  26 weeks annual leave) so that the employer could never agree with the claims, and then ask the Commission to find that a dispute exists between the union and the employer.  This paper ‘dispute’ is commonly resolved by the employer being made a respondent to the award.  Small businesses which do not belong to an employer organisation, often do not respond to the union’s claims, are not represented before the Commission, and may sometimes not even be aware they have been roped into a federal award.

 

Objectives:

 

The Government’s objectives are to:

 

·         provide all businesses with more information about their rights and the processes involved with roping-in claims;

 

·         require the Commission to inquire into the views of unrepresented small business employers affected by a roping-in claim; and

 

·         constrain the ability of unions to rope small businesses which employ no union members into the federal jurisdiction.

 

Option:

 

This option contains a number of measures which are complementary.

 

The Commission would be required not to make any finding of dispute in respect of any employer where the alleged dispute was notified on the ground that the employer had not agreed to demands set out in a log of claims, unless satisfied that:

 

·         the log of claims, when served, was accompanied by a notice containing prescribed information;

 

·         the alleged dispute was not notified until at least 28 days after service of the log;

 

·         the party notifying the alleged dispute had given the employer at least 28 days notice of the time and place for hearing of the dispute notification; and

 

·         the log of claims does not include any demand that requires conduct or provisions contrary to the freedom of association provisions of the Act, or not pertaining to the relationship between employers and employees. 

 

The Australian Industrial Relations Commission would be required to inquire as to the views of small business employers affected by the making of an award, rather than only attending to the views of employers who appear or are represented at hearings. 

 

A dispute with an employer with less than 20 employees would only be taken to exist, in a roping-in or log of claims process, where the union has a member employed by the employer.

 

Impact analysis (costs and benefits) of the option:

 

(a)    Effect on employers

 

The first measure would ensure that any employer subject to a roping-in claim would be more aware of what the process involved and would have more time to consider alternative responses. 

 

The second measure would improve the prospect that small business would not be inappropriately affected by federal awards, but would still depend on the Commission’s exercise of its discretion.  It is estimated that approximately 180 000 small businesses are covered by the federal system.

 

The third measure would effectively prevent the vast majority of small businesses not currently in the federal jurisdiction from being roped-in to a federal award.  It is broadly estimated that around 6 per cent of small businesses have at least one employee who is a union member. 

 

Those small business employers without any employees which are union members and not currently covered by respondent federal awards would remain covered by state awards and agreements, or in the case of Victoria - Schedule 1A minima, or in the case of the Territories by common rule federal awards, or would remain award free.

 

(b)    Effect on employees

 

Employees in small businesses which were not roped-in to a federal award under the above proposals would be covered by state awards or agreements, or would remain award free or, in Victoria, would remain covered by Schedule 1A in the WR Act, or in the case of the Territories would be covered by common rule federal awards..

 

The impact of these proposals would be different for employees who are or become union members, as roping-in of their employers would not be precluded.

 

(c)     Effect on Consumers and Australian Economy

 

The third measure would effectively prevent future large scale roping-in exercises such as the current SDA claim.  Where the small businesses were otherwise award free or in Victoria covered by Schedule 1A conditions this would prevent potentially significant cost increases being imposed on small businesses and the possibility that these costs would be passed onto consumers.  Avoiding these potentially significant cost increases would also prevent any associated job losses.  The potential cost increases of changing from a state award to a federal award would be less significant as state awards generally provide for penalty and overtime rates although these do vary between and amongst state and federal awards. 

 

Consultation:

 

Over the last six months, the Minister for Small Business, the Hon Ian Macfarlane MP, has undertaken formal and informal consultations with small business operators at which the impact of workplace relations regulation on small business operators has been broadly identified by employers.  The first proposal  is contained in the Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999.  No specific consultation has occurred in relation to the second and third proposals.

 

Implementation and Review:

 

All of the proposals would require amendments to the WR Act.  DEWRSB would monitor and evaluate the effect of such legislative change.

 

 



REGULATION IMPACT STATEMENT

 

Limit Union Right of Entry

 

 

Problem:

 

The current right of entry provisions in the Workplace Relations Act 1996 (WR Act) dictate that officials of registered unions may enter an employer’s premises for specified purposes if they hold a current permit issued by a Registrar.  An invitation from a union member at the workplace is not currently required. 

 

Union entry into the workplace without the express invitation of union members is inconsistent with the Government’s intention that the focus of the federal workplace relations system should be on the employer/employee relationship with uninvited third party intervention limited.  Anecdotal evidence suggests that the current arrangements, which allow unrequested union entry into the workplace, are resulting in unnecessary disruption for business by allowing unions to engage in ‘fishing expeditions’ where they enter workplaces for investigative purposes despite having no actual basis for suspecting a breach.  Moreover, the WR Act currently allows union officials to frequently enter workplaces ‘to hold discussions’, which may result in the repeated harassment of non-union members to join a union.  In addition, the fact that unions are currently only required to give 24 hours notice prior to entry may result in problematic conflicts with business demands when union entry occurs.

 

Current Situation:

 

At present, under the WR Act, permit holders may enter an employer’s premises for specified investigative or discussion purposes without invitation from a union member at the workplace.  Permit holders may enter workplaces where employees belonging to the union they represent work, in order to investigate possible breaches of the WR Act or of relevant awards or agreements.  Entry is also allowed into workplaces, where work is being conducted under an award that binds the relevant union, to hold discussions with any employees who wish to participate, provided that there are employees present at the workplace who are members of that union or are eligible to become members.  Twenty-four hours notice must be given prior to entry in all cases. 

 

Objective:

 

The Government’s objective is to:

 

  • ensure that unions utilise their right of entry in a responsible manner that reflects their role as membership-based service organisations by restricting entry to circumstances where there is support at the workplace from their membership; 

 

  • protect non union members from being repeatedly harassed to join a union by limiting the frequency of entry for discussion purposes; and

 

  • alleviate some difficulties that right of entry may cause businesses, especially small business, by ensuring that the employer (and the occupier, where the employer is not the occupier) has more reasonable notice of the proposed visit by the union and an opportunity to propose an alternative date where the date chosen by the union conflicts with business demands.

 

Option:

 

Right of entry to business premises by a union official would be conditional on a written invitation from a union member employed in the business, and provision of 5 working days notice to the business.

 

·          For inspection purposes, the invitation would have to be made by a union member employed at the workplace, and inspection of time and wage records would be limited to union members’ records;

 

·          For discussion purposes (that is, where entry does not relate to an alleged breach of member entitlements) the invitation would have to be issued by at least one union member, the invitation would only authorise one entry, and entry would be limited to once every 6 months (to protect non-members from harassment).

 

·          Employers and occupiers would be given the right to propose an alternative date to that proposed by the union, within 5 working days of the originally proposed date;

 

·          Union officials would be required to provide the employer and the occupier, immediately upon entering the premises, with a card displaying prescribed text on the rights and obligations of the employer and the union official in respect of right of entry provisions.  The text would include a phone number for the employer or occupier to call the Office of the Employment Advocate (OEA) if they have particular concerns.

 

In addition, legislative protection would be provided for employees to prevent unions from pressuring or harassing members or employees into issuing invitations and from disciplining members who refuse to issue an invitation.  Protection would also be provided for employees who issue an invitation against discrimination by their employer.  These protections would complement the extensive protections for freedom of association already provided by the WR Act. 

 

Impact analysis (costs and benefits) of the option:

 

(d)    Effect on employers

 

The Department broadly estimates that there are around 200,000 employing businesses which fall within the jurisdictional ambit of the WR Act right of entry provisions.  Under the proposal, entry for inspection or discussion purposes would also require an invitation from a union member. 

 

·          Data from the Australian Workplace Industrial Relations Survey 1995 indicates that 43 per cent of workplaces with more than five employees had at least one union member at the workplace. [4]   The AWIRS data also indicates that the percentage of workplaces with at least one union member falls increasingly rapidly with workplace size.  The Department estimates that only around 3 per cent of workplaces with less than five employees have at least one union member.  Because workplaces of this size make up around 64 per cent of all workplaces in Australia, their inclusion has a dramatic impact on the overall percentage, which comes out at around 17 per cent of workplaces having at least one union member. 

 

Assuming that there are 1.27 workplaces per business [5] , this would imply that there would be roughly around 17 per cent of 254,000 workplaces or 43,200 federal workplaces that would potentially be subject to union entry for both inspection and discussion purposes.

 

·          Under the proposal, there is likely to be a reduction in the number of businesses subject to entry for inspection purposes (as invitation is required), and an even greater proportional reduction in the number of businesses subject to entry for discussion purposes (as currently, a union member does not even have to be present at the workplace, as long as there are employees present who are eligible to become members).  There would also be a reduction in the frequency of discussion visits.  It is not, however, possible to provide a quantifiable estimate of what entry rates will be.

 

Businesses would benefit from less disruption from union entry into the workplace, whilst union entry would be less intrusive and more appropriately scheduled.  To the extent that unions exercising right of entry under the present arrangements negatively impact on the productive efficiency of businesses, the proposal may yield productivity benefits for these businesses, although there exists no way to quantifiably estimate the impact.

 

The package of proposals under this option would also help assuage employer concerns about union right of entry by ensuring, consistent with Government policy in relation to the proper role of unions as membership-based service organisations, that unions are only able to enter workplaces where there is support at the workplace from their membership.

 

(e)     Effect on employees

 

The Department broadly estimates that around 50 per cent of Australian employees are covered by the federal system.  This equates to around 3,687,000 employees. [6]

 

Under the proposal, entry for inspection or discussion purposes would also require an invitation from a union member. 

 

·          ABS data from August 2000 [7] indicate that the proportion of employees (in all jurisdictions - no jurisdictional breakdown available) who were trade union members was 24.7 per cent. 

 

Using this data, a broad estimate of the number of employees who would be potentially eligible to make invitations to unions under the proposal can be made (i.e.  24.7 per cent of 3,687,000).  That calculation yields a figure of 911,000 employees potentially eligible to make an invitation.

 

On inspection visits, inspection of time and wage records would be limited to any of those roughly 911,000 employees working at a workplace where an invitation was made.  It is not possible to estimate beyond this the number of workplaces where invitations would actually be made. 

 

The proposal comprehends that unions should utilise their right of entry in a responsible manner that reflects their role as membership-based service organisations.  It should be remembered that all employees in the federal jurisdiction may access the compliance services provided by the Department of Employment, Workplace Relations and Small Business.

 

The proposal to limit the frequency of entry for discussion purposes to once every 6 months will benefit many employees by protecting non-union members in businesses in the federal jurisdiction (broadly estimated to be 75.3 per cent or 2,776,000 employees) from being repeatedly pressured to join a union. 

 

(f)      Effect on Consumers and Australian Economy

 

Many businesses would benefit from less frequent unnecessary union entry and from less intrusive and better scheduled entry, reducing workplace disruption and probably yielding productivity benefits for these businesses.  Productivity gains may in turn be passed on to consumers in the form of lower prices or improved quality, depending on the competitiveness of various product markets.  Such supply-side gains for the economy would also be expected, other things being equal, to contribute to economic and employment growth.  It is impossible to estimate the magnitude of these benefits, although they would be unlikely to be particularly large in the context of the national economy.

 

Consultation:

 

Over the last six months, the Minister for Small Business, the Hon Ian Macfarlane MP, has undertaken formal and informal consultations with small business operators at which employers have broadly identified the impact of workplace relations regulations on small business operators.  No recent direct consultation on the above proposals has occurred.  However, the proposal to introduce an invitation requirement for right of entry was previously included in the Workplace Relations and Other Legislation Amendment Bill 1996 and in the Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999 (the MJBP Bill).  The invitation requirement proposed in Option 1 is substantially the same as proposed in the MJBP Bill except that the MJBP Bill proposal did not limit either the number of discussion visits each invitation could authorise or the frequency of discussion visits. 

 

Implementation and Review:

 

All of the proposals would require amendments to the WR Act.  DEWRSB would monitor and evaluate the effect of such legislative change.

 



REGULATION IMPACT STATEMENT

 

Independent contractors - limit regulation

 

 

Problem:

 

The relationship between a business and a contractor should be essentially a commercial and not a workplace relations arrangement.  However, awards and agreements may contain provisions that restrict the use of contractors and labour hire and that draw contractors into workplace relations arrangements.

 

Current Situation:

 

Contractors are an important part of the small business community.  Their work arrangements take a variety of forms, for example they may have a direct relationship with another enterprise or work through an intermediary (such as a labour hire firm), and they may or may not employ staff.

 

An ‘independent contractor’ is a person who contracts to perform services for others without having the legal status of an employee.  The term is generally used to refer to persons who operate independently and do not engage employees.  Independent contractors follow their own trade, business or profession.  Independent contractors may be found in highly specialised and technical fields, such as computer programming, engineering and accounting.  They are also found in a range of other occupations and industries, including construction, and business services (such as cleaning and security).  In fact, there are very few jobs that independent contractors do not perform. 

 

The broader term ‘contractor’ is generally used where a firm contracts with another for the supply of goods or services, including labour, and may engage employees or subcontractors to do the work.  Like independent contractors, contractors are often small businesses that provide specialist services.

 

Provisions in agreements may constrain the use of contractors in a number of ways, for example by:

 

·         defining and limiting the circumstances in which contractors may be used (eg ‘where it is determined there are no suitable internal resources available’, ‘to meet peak workloads’, ‘to perform specialist functions where the employer does not have the requisite skills’, ‘as relief after permanent drivers have all been offered overtime’, ‘during periods of dispute the number of contractors engaged on site will not be increased’);

 

·         placing procedural requirements on the use of contractors (eg ‘the use of external contractors requires prior negotiation with the unions’);

 

·         requiring contractors to make certain types of industrial agreements (eg ‘all contractors will be required to negotiate an Enterprise Agreement with the relevant union(s) that is party to this Agreement within one month of obtaining the contract’); and

 

·         requiring contractors to observe certain behaviour (eg ‘any work bans imposed by tradespeople will be observed by contractors’).

 

Some awards include provisions relating to contractors to prevent undercutting of employees’ award rates.  These provisions are not limited to outworkers (eg Municipal Employees (Western Australia) Turf Club Award 1992; Rope, Cordage, Thread Etc Industry Award 1996).  Such provisions may be ‘incidental and necessary’ to the provision of ‘rates of pay generally’ (an allowable award matter), but this issue has not been tested.  They are, in part, a response to the fact that federal awards cannot apply as common rules, but can only apply to named respondents.  They commonly require a respondent employer that contracts out work covered by the award to include a term in the contract binding the contractor to observe the rates and conditions of the award.  Such clauses may raise complex compliance issues for contractors, as a State award may also bind them. 

 

Restrictions on the use of contractors are not specified within the ‘allowable matters’ contained in section 89A of the Workplace Relations Act 1996 (WR Act).  However, the Australian Industrial Relations Commission has taken the view that certain provisions relating to contractors can be included as incidental to protections for employees, and necessary for their effective operation.  For example, the Clothing Trades Award 1999 includes provisions preventing respondent employers from contracting out work except on condition that the work be performed on terms no less favourable than those provided by the award, and on condition that the contractor include similar terms in any subcontracts.  (These provisions are intended to protect factory-based employees, but also tend to protect outworkers, whether employees or contractors.)

 

Whether the Clothing Trades Award affects a contract for services depends on whether the manufacturer (at the top of the chain of contracting) or any intervening contractor is a respondent to the award.  Many manufacturers and contractors would not be respondents to the award, so the Award will not affect the outworkers who perform work for them.  It is often unclear whether an outworker’s contract is affected by the Award—outworkers relationships with manufacturers are typically mediated by sub-contractors or ‘middlemen’, and outworkers commonly do not know the identity of parties higher in the chain of contracting than the individuals they deal with directly. 

 

Objective:

 

The Government’s objective is to ensure that the relationship between a business and a contractor is essentially a commercial and not a workplace relations arrangement, and more specifically:

 

·                that awards and agreements do not restrict the use of contractors or draw contractors into workplace relations arrangements to which they are not respondents or parties. 

 

This broad objective is not intended to detract from the Government’s objective of maintaining a safety net for TCF outworkers.

 

Under pressures for greater international competitiveness, the TCF industry has undergone major restructuring associated with reductions in tariffs and bounties.  This has resulted in high-volume manufacturing in the industry tending to move offshore.  At the same time Australian manufacturing in the clothing industry, in particular, appears to have shifted from a factory-based workforce to one centred around outworkers (who may be employees or independent contractors). 

 

The Senate Economics References Committee, which reported in December 1996, [8] found that most clothing outworkers were migrant women, aged between 25 and 35, who had young children at home.  Typically, they work in isolated conditions in their own homes, or someone else’s home.  Most clothing outworkers were found to be recent migrants who had very poor English language skills.  They had no educational qualifications that were recognised in Australia.  These factors, together with their family-care responsibilities, reduced their ability to find other work.  The Committee found that there was no shortage of recent migrants available to do clothing outwork because of the very high rate of unemployment, particularly among women in that sector. 

 

The interaction of the special factors that prevail in the TCF industry result in TCF workers typically having limited bargaining skills and ability.  The difficulties this creates for negotiating commercial arrangements are exacerbated by the contractual complexity that prevails in the TCF industry (with its chains of contracts between manufacturers, intermediaries and outworkers). 

 

Given the extent of public concern about the conditions of outworkers in the textiles, clothing and footwear (TCF) industry and their particular vulnerability, provision would be made for an exception for award provisions in that industry.  Maintaining the floor of award entitlements for a group of workers with limited bargaining skills and ability operating in a complex contractual environment will ensure that these workers can more confidently enter into commercial arrangements. 

 

The exemption will apply to award provisions.  TCF agreements would not be exempted from the changes, as the no disadvantage test would continue to protect TCF workers when entering into formal agreements.  Provisions in the award that prevent respondent employers from contracting out work except on condition that the work be performed on terms no less favourable than those provided by the award would be taken into account by the Australian Industrial Relations Commission when applying the no disadvantage test to agreements.

 

Option:

 

The option would prevent federal awards and agreements from restricting the use of contractors and labour hire.  There would be an exemption for award provisions in the TCF industry.  Provisions in that industry that prevent employers from engaging contractors unless they do so in a way that does not undercut award rates would be allowed.

 

Impact analysis (costs and benefits) of the option:

 

(g)    Effect on contractors

 

The proposal would improve the prospect that independent and other contractors would not be inappropriately affected by awards and agreements to which they are not respondents or parties.  It would improve the freedom of contractors to make commercial arrangements according to their business needs, without being drawn into the workplace relations arrangements made by others.  It would thereby benefit an important segment of the small business community.

 

Forms of Employment Australia (ABS Cat.  No.  6359.0) publishes data on a range of working arrangements.  It shows that in August 1998 there were around 400,000 owner managers of incorporated or unincorporated enterprises that undertook contract work and did not have employees (‘independent contractors’).  Almost two thirds of owner managers that undertook contract work and did not have employees were found in two industries—Construction (147,129) and Property and business services (105,248). 

 

Forms of Employment Australia also shows that in August 1998 there were around 212,291 owner managers of incorporated or unincorporated enterprises that undertook contract work and did have employees (‘contractors’).  Almost two thirds of owner managers that undertook contract work and did have employees were found in two industries—Construction (78,810) and Property and business services (55,572).

 

These figures are for Australia as a whole.  It is not known how many independent or other contractors come under the influence of the federal as against the State jurisdictions, or how many are affected by restrictive provisions in federal awards and agreements. 

 

(h)    Effect on employees

 

The proposal would enhance the freedom of employees of contractors to enter into workplace relations arrangements of their choice, rather than being constrained by the arrangements made by third parties. 

 

Employees and contractors, including outworkers, in the TCF industry would not be affected by the changes so far as they relate to awards.  Because of the circumstances of outworkers (employees and contractors) in this industry in particular (see above), the benefits of maintaining provisions of the kind included in the Clothing Trades Award 1999 outweigh the benefits that would apply in other industries as a result of the removal of restrictions on contractors.  Maintaining the floor of entitlements to terms no less favourable than those provided by the award for a group of workers with limited bargaining skills and ability operating in a complex contractual environment will ensure that the TCF workers can more confidently enter into commercial arrangements. 

 

(i)      Effect on Consumers and Australian Economy

 

The proposal offers potential benefits to consumers and the Australian economy.  It has the potential to enhanced labour market flexibility and efficiency by removing artificial restrictions on the use of contractors and labour hire.  It would enhance freedom of contract for small businesses, and ensure that the relationship between a business and a contractor is essentially a commercial arrangement.

 

Consultation:

 

Over the last six months, the Minister for Small Business, the Hon Ian Macfarlane MP, has undertaken formal and informal consultations with small business operators at which employers have broadly identified the impact of workplace relations regulation on small business operators.  No recent direct consultation on the above proposals has occurred. 

 

Implementation and Review:

 

The proposal would require amendments to the WR Act.  DEWRSB would monitor and evaluate the effect of such legislative change, including by monitoring decisions of the Australian Industrial Relations Commission and examining federal awards and agreements to determine changes in the use of restrictive provisions.

 

 



NOTES ON CLAUSES

 

Clause 1 - Short title

 

This is a formal provision specifying the short title of the Act.

 

Clause 2 - Commencement

 

This clause specifies when various provisions of the Act are proposed to commence.

 

Schedule 5 (Secondary Boycotts) will commence on Royal Assent.  Each other Schedule commences on a day to be fixed by Proclamation, but if it has not commenced within 6 months after Royal Assent, it commences on the first day after that period. 

 

Clause 3 - Schedule(s)

 

Clause 3 provides that an Act specified in a Schedule to this Act is amended or repealed as set out in the Schedule, and that any other item in a Schedule operates according to its terms. 

 



SCHEDULE 1 - OBJECTS PROVISIONS

 

1.1                    This Schedule will make changes to the principal object of the Workplace Relations Act 1996 , along with the objects of particular Parts of the Act.

 

1.2                    The objective of these changes is to increase the extent to which the Commission takes into account the circumstances of small business in its decisions and in its rules and procedures.  This objective will also be assisted by the proposed transitional provision, which will require the President of the Commission to review the Rules of the Commission in light of the changes made by this and other Schedules.

 

 

Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - After paragraph 3(h)

 

1.3                    This item inserts a new paragraph 3(h)(a) in the principal object of the Act, requiring the Commission to take into account the circumstances of employers and employees in small business in performing its functions and in exercising its powers under the Workplace Relations Act 1996 .

 

Item 2 - At the end of paragraph 88A(d)

 

1.2         This item inserts a new object for Part VI of the Act, which deals with Dispute Prevention and Settlement.  It will require the Commission, in performing and exercising its functions and powers in relation to making and varying awards, to take into account the circumstances of employers and employees in small business.

 

Item 3 - At the end of section 170CA

 

1.3         This item inserts a new subsection in section 170CA to require that Commission must take into account the circumstances of employers and employees in small business in performing its functions, and in exercising it powers, under Division 3 of Part VIA (termination of employment) of the Act.

 

Item 4 - After subsection 170LA(1)

 

1.4         This item inserts a new subsection 170LA(1A), which requires the Commission when performing its functions under Part VIB of the Act (Certified Agreements) to take into account the circumstances of employers and employees in small business.

 

 

Part 2 - Application and Transitional Provisions

 

Item 5 - Application

 

1.5         This item provides that items 1 to 4 apply in relation to any proceedings before the Commission (whether instituted before or after the commencement of those items).

 

Item 6 - Transitional provision - review of Rules of Commission

 

1.6                    This item would insert a transitional provision, requiring the President of the Commission, within 8 months of the commencement of the Schedule, to complete a review of the Rules of the Commission made under section 48 of the Act.  This review would be conducted with regard to the amendments of the Act made by this Bill, particularly the changes to the object provisions concerning the need for the Commission to take into account the circumstances of employers and employees in small business in performing its functions, including through appropriate changes to its principles, procedures and rules.  The President would be required to provide the Minister with a written report about the review. 

 

1.7               The President would then be required make any new Rules of the Commission, or variations to existing rules, that the President considers appropriate as a result of the review.

 

 



SCHEDULE 2 - UNFAIR DISMISSAL

 

2.1       This Schedule proposes two measures to minimise the impact of unfair dismissal claims by employees of small business.  For the purposes of this Schedule, a ‘small business’ is a business with fewer than 20 employees, including:

 

·          casual employees who have been engaged on a regular and systematic basis for a period or sequence of periods of at least 12 months; and

 

·          the employee whose employment was terminated.

 

 

Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - Subsection 170CE(1)

 

2.2         Item 1 proposes to amend subsection 170CE(1) to include a reference to proposed subsection 170CE(5C) (which would exclude certain employees of small business from access to a remedy in respect of harsh, unjust or unreasonable termination of employment. 

 

Item 2 - Before subsection 170CE(6)

 

2.3       Item 2 would insert new subsections 170CE(5C), (5D) and (5E) into the Act.  The effect of these provisions would be to prevent certain employees of small business from applying for a remedy in respect of harsh, unjust or unreasonable termination of employment. 

 

New subsection 170CE(5C)

 

2.4       New subsection 170CE(5C) will provide that an application may not be made under subsection 170CE(1) on the ground that a termination was harsh, unjust or unreasonable (or on grounds that include that ground) where, at the relevant time, the respondent employer employed fewer than 20 people. 

 

2.5       Paragraphs (a) and (b) of new subsection 170CE(5C) will also clarify which employees are to be counted for the purpose of establishing whether the employer employed fewer than 20 employees at the relevant time.  Paragraph 170CE(5C)(a) will make clear that the employee whose employment was terminated is to be counted.  Paragraph (5C)(b) will provide that casual employees who had been engaged on a regular and systematic basis for a sequence of periods of employment of at least 12 months are to be counted.  No other casual employee is to be counted. 

 

New subsection 170CE(5D)

 

2.6       New subsection 170CE(5D) would provide that the exclusion in new subsection 170CE(5C) does not apply where the applicant was, at the relevant time, an apprentice or a trainee under a traineeship in respect of which he or she had signed a training agreement registered with a State or Territory training authority.

 

2.7       The terms ‘apprentice’, ‘trainee’, ‘traineeship’, ‘training agreement’ and ‘training authority’ are to have their ordinary meanings. 

 

New subsection 170CE(5E)

 

2.8       New subsection 170CE(5E) would set out the meaning of  ‘relevant time’.  This expression is to be defined as the time when the employer gave the employee notice of termination, or the time when the employer terminated the employee’s employment, whichever happened first. 

 

2.9         It should be noted that apprentices and trainees, although they are not affected by these proposed provisions, may be excluded from a remedy in respect of harsh, unjust or unreasonable termination of employment for other reasons.  For example, apprentices may be excluded on the basis that they are engaged under a contract of employment for a specified period of time within the meaning of paragraph 30B(1)(a) of the Workplace Relations Regulations 1996 .  However, this will depend on the terms of the particular contract or indenture of apprenticeship. 

 

Item 3 - After section 170CE

 

New section 170CEAA - Dismissal of application

 

2.10     New section 170CEAA would give the Commission the power to dismiss applications by employees of small business in respect of harsh, unjust or unreasonable termination of employment without being required to hold a hearing, where the application:

 

·          is outside the Commission’s jurisdiction; or

 

·          is frivolous or vexatious, or lacking in substance. 

 

2.11       New subsection 170CEAA(1) will provide that the Commission’s power to dismiss applications without a hearing arises in respect of an application alleging harsh, unjust or unreasonable termination of employment, where, the relevant time, the employer employed fewer than 20 people, including the applicant and any casual employee who had been engaged on a regular and systematic basis for a sequence of periods of at least 12 months.  New subsection 170CEAA(7) would define ‘relevant time’ as being the time when the employer gave the employee notice of termination, or the time when the employer terminated the employee’s employment, whichever happened first.

 

2.12       New subsection 170CEAA(2) sets out the Commission’s power to dismiss an application by an employee of a small business on the basis that it lacks jurisdiction to deal with it.  Where the Commission is satisfied that the applicant is not entitled to make an application for relief in respect of harsh, unjust or unreasonable termination of employment (ie the ground in paragraph 170CE(1)(a)), the Commission may order that the application is not a valid application. 

 

2.13       New subsection 170CEAA(3) sets out the Commission’s power to dismiss an application by an employee of a small business on the basis that it is frivolous, vexatious or lacking in substance.  Where a person applies for a remedy on the basis that his or her termination was harsh, unjust or unreasonable (or on grounds including that ground) and the Commission is satisfied that the application is frivolous, vexatious or lacking in substance, the Commission may dismiss the application, to the extent that it deals with that ground.

 

2.14       New subsection 170CEAA(4) would make clear that the Commission is not required to hold a hearing in relation to the making of an order.  Furthermore, it would require the Commission, in considering whether to hold a hearing, to take into account the cost that would be caused to the employer’s business by requiring the employer to attend a hearing. 

 

2.15       New subsection 170CEAA(5) would give the Commission the power to issue a notice to one or both of the parties requesting further information in relation to the application within the period specified in the notice.  New subsection 170CEAA(6) would require the Commission to have regard to any further information received within that period.  These provisions would not prevent the Commission from sending out further notices requesting more information, as a consequence of information already provided. 

 

Item 4 - At the end of section 170JD

 

2.16       Section 170JD of the WR Act provides that the Commission can vary or revoke an order under Part VIA, on application by a party (or their representative) who is covered by the order.  New subsection 170JD(4) (to be inserted by this item) would make clear that a person who is covered by an order made under section 170CEAA is not entitled to apply to have that order varied or revoked. 

 

Item 5 - At the end of section 170JF

 

2.17     Section 170JF provides of the WR Act provides that a party who is entitled to apply to vary or revoke an order under section 170JD is entitled to appeal to a Full Bench of the Commission under section 45 of the WR Act against an order under Part VIA.  New subsection 170JF(3) would make clear that the right to appeal to a Full Bench does not apply in relation to an order under section 170CEAA. 

 

 

Part 2 - Application provisions

 

Item 6 - Application of items 1 and 2

 

2.18     Item 6 would provide that the amendments proposed to subsection 170CE(1) and new subsections 170CE(5C), (5D) and (5E) (the exclusion of new small business employees from remedies in respect of harsh, unjust or unreasonable termination of employment) will apply to those employees who were first employed in the small business after the commencement of this Schedule. 

 

Item 7 - Application of items 3, 4 and 5

 

2.19     Item 7 would provide that the amendments relating to the Commission’s power to dismiss applications in respect of harsh, unjust or unreasonable termination of employment without a hearing apply in relation to terminations of employment that occur after the commencement of the Schedule.

 

 



SCHEDULE 3 - AWAs

 

3.1   This Schedule proposes the amendment of the Workplace Relations Act 1996 (the WR Act) to reform and strengthen the WR Act’s provisions relating to Australian Workplace Agreements (AWAs).  The amendments would:

·       provide for AWAs to take effect on the date of signing or, if later, the date specified in the AWA as the commencing day, or, in the case of a new employee, the date the employment commences;

 

·       permit employees to sign AWAs at any time after receiving a copy of the information statement prepared by the Employment Advocate and an explanation of the effect of the agreement;

 

·       permit an employee party to an AWA to withdraw consent within a cooling-off period;

 

·       remove the requirement relating to offering identical AWAs to comparable employees; and

 

·       simplify the approval process by:

 

-        consolidating the existing assessment of filing requirements and approval requirements into a one step approval process; and

 

-        removing the requirement that the Employment Advocate refer AWAs to the Australian Industrial Relations Commission where there is concern that the AWA does not pass the no-disadvantage test - the Employment Advocate would apply the no-disadvantage test in all cases (subject to principles which may be developed by the Commission).

 

Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - Divisions 1, 2, 3, 4, 5 and 6 of Part VID  

3.2   Item 1 would repeal existing Divisions 1, 2, 3, 4, 5 and 6 of Part VID of the WR Act, and replace them with new Divisions 1, 2, 3, 4 and 5.  Whilst the proposed new Divisions would significantly amend the procedures for the making, approval and enforcement of AWAs, a number of existing provisions would be reinserted in their existing form. 

New Division 1 - Preliminary

New Subdivision A - Outline of Part

New section 170VA - Outline of Part  

3.3   Proposed section 170VA sets out the contents of Part VID as amended. 

New Subdivision B - Interpretation

New section 170VAA - Definitions  

3.4   New section 170VAA defines a range of terms to be used in Part VID as amended. 

New section 170VAB - Proposed AWAs and ancillary documents - interpretation  

3.5   New subsection 170VAB(1) would provide that a reference to an Australian Workplace Agreement (AWA) or an ancillary document includes a proposed AWA or ancillary document.  (Ancillary documents are agreements to vary, extend or terminate an AWA.) 

3.6   In a proposed AWA or ancillary document, a reference to the employer or employee would include a reference to the future employer or employee [new subsection 170VAB(2)]. 

New Subdivision C - Scope of this Part etc .

New section 170VAC - Scope of this Part  

3.7   Proposed section 170VAC reflects the constitutional limitations on the making of AWAs and would require that one of the following criteria apply at the AWA date (as defined in new section 170VAA) for the AWA to have effect:

·                     the employer is a constitutional corporation;

·                     the employer is the Commonwealth;

·                     the employee’s primary workplace is in a Territory;

·                     the employer is a waterside employer, the employee is a waterside worker and the employee’s employment is in connection with constitutional trade and commerce;

·                     the employee is a maritime worker and the employee’s employment is in connection with constitutional trade and commerce;

·                     the employee is a flight crew officer and the employee’s employment is in connection with constitutional trade and commerce. 

3.8   Existing section 495 provides for the additional operation of Part VID in Victoria.

New section 170VAD - AWAs and ancillary documents only have effect as provided by this Part  

3.9   New section 170VAD would provide that AWAs and ancillary documents only have effect as provided for in this Part.

New Division 2 - Making an AWA

New section 170VB - Employer and employee may make an AWA  

3.10           New subsection 170VB(1) would provide that an employer and employee may make a written agreement, called an Australian Workplace Agreement or AWA, that deals with matters pertaining to their employment relationship. 

3.11           New subsection 170VB(2) would provide that the requirements in new sections 170VBA (which deals with the making of AWAs) and 170VBB (which deals with the content of AWAs) must be met. 

3.12           New subsection 170VB(3) would permit an AWA to be made before an employee commences employment.  (The term ‘new employee’ is defined in proposed section 170VAA as an employee who signed an AWA before or at the time of commencing the work to which the AWA relates.) 

New section 170VBA - Making an AWA 

3.13           New section 170VBA sets out the proposed requirements for making an AWA:

·                     the AWA must be signed and dated by the employer and the employee who are parties to it [subsection 170VBA(1)];

·                     the employee must genuinely consent to the terms and conditions in the AWA [subsection 170VBA(2)];

·                     the employer must give the employee a copy of the AWA [subsection 170VBA(3)]; and

·                     before the employee signs the AWA, the employer must give the employee a copy of an information statement prepared by the Employment Advocate and explain the effect of the AWA to the employee [subsection 170VBA(4)]. 

3.14           Proposed subsection 170VBA(5) sets out the information that would be required to be provided in the information statement referred to in subsection 170VBA(4). 

3.15           Proposed subsection 170VBA(6) would provide that the employee may withdraw consent to the AWA within a cooling-off period.  The cooling-off period is 5 days after the date of signing for new employees and 14 days after signing for existing employees [subsection 170VBA(7)].  Written notice of withdrawal would be required to be given to the employer and to the Employment Advocate [subsections 170VBA(6) and 170VC(5)].  The effect of withdrawing consent is dealt with in new section 170VCA. 

New section 170VBB - Content of AWA

3.16           New subsection 170VBB(1) would provide that an AWA must include the provisions relating to discrimination that are prescribed by the regulations.  The prescribed provisions relating to discrimination would automatically be included in any AWA that does not include the prescribed provisions.

3.17           New subsection 170VBB(2) would require an AWA to include a dispute resolution procedure.  A default procedure (as prescribed by the regulations) would automatically be included in any AWA that does not include a dispute resolution procedure. 

3.18           New subsection 170VBB(3) would allow a dispute resolution procedure in an AWA (whether the default procedure or not) to confer powers on the Australian Industrial Relations Commission (the Commission) to settle disputes between the parties to the AWA.

3.19           New subsection 170VBB(4) would provide that the AWA must not include any provisions which would prohibit or restrict either party to the AWA from disclosing details of the AWA to another person. 

3.20           New subsection 170VBB(5) would provide that the AWA must not include any objectionable provisions within the meaning of section 298Z of the WR Act.  These are provisions that require or permit, or have the effect, or purport to have the effect, of requiring or permitting conduct that would contravene Part XA of the WR Act.

New section 170VBC - Nominal expiry date of AWA  

3.21           New section 170VBC would provide that an AWA may specify a nominal expiry date; however, this date could not be more than 3 years after the AWA was signed [new subsection 170VBC(1)].  If no date is specified, then the nominal expiry date would be the third anniversary of the date of signing [new subsection 170VBC(2)]. 

New section 170VBD - Period of operation of AWA 

3.22           Proposed section 170VBD sets out when an AWA would start and stop operating.  An AWA would start operating on the later of:

·                     the AWA date (which is defined in section 170VAA as the date the AWA is signed, or if signed on different dates, the later of those dates) [paragraph 170VBD(a)];

·                     the date specified in the AWA as the starting day [paragraph 170VBD(b)]; or

·                     in the case of a new employee (as defined in section 170VAA) as the day the employment commences [paragraph 170VBD(c)]. 

3.23           An AWA would stop operating at the earlier of any of the following times:

·                     where the employer fails to make an application for approval of the AWA within the period of 60 days starting on the AWA date - the start of the day after the 60 day period ends [paragraph 170VBD(d)];

·                     where approval of the AWA is refused - the end of the day the refusal notice is issued [paragraph 170VBD(e)];

·                     where the AWA is terminated under proposed sections 170VEN, 170VEO or 170VEQ - the time the termination takes effect under the relevant section [paragraph 170VBD(f)]; or

·                     the time when another AWA between the employer and employee starts to operate [paragraph 170VBD(g)]. 

3.24           The operation of an AWA would also be affected where an eligible employee withdraws his or her consent to the AWA (see proposed section 170VCA below). 

New Division 3 - Approval of AWAs

New section 170VC - Applications for approval of AWAs  

3.25           Proposed section 170VC would set out the process for applying for an AWA to be approved:

·                     An employer must make a written application for approval of an AWA to the Employment Advocate unless the employee withdraws his or her consent during the cooling-off period [subsection 170VC(1)];

·                     the application would be required to be made within the 60 day period starting on the AWA date [subsection 170VC(2)];

·                     an application would be required to be accompanied by a copy of the AWA and any other information required by the Employment Advocate.  (The Employment Advocate may publish a notice in the Gazette specifying information to be provided by applicants.) [subsection 170VC(3)];

3.26           Proposed subsection 170VC(4) would permit two or more AWAs to be included in the same notice of application, provided that the same employer is a party to all the agreements.  There would be no requirement that multiple AWAs filed in a single application contain the same terms. 

3.27           Proposed subsections 170VC(5) and (6) would set out further requirements for an employee to withdraw consent to an AWA.  In addition to satisfying the requirements in subsections 170VBA(6) and (7), an employee would be required to give the Employment Advocate written notice of the withdrawal of consent within 7 days after giving notice of withdrawal to the employer.  A withdrawal of consent would not be effective unless these requirements have been met. 

3.28           If consent is withdrawn, the employer would not be required to apply for approval of the AWA.  However, if the employer applies for the AWA to be approved before consent is withdrawn, the notice of withdrawal would provide a basis for the Employment Advocate to cease dealing with the application.

New section 170VCA - Consequences for AWA of employee’s withdrawal of consent  

3.29           Proposed section 170VCA would provide that where an employee withdraws his or her consent to the AWA before the end of the cooling-off period, the AWA would be taken not to have started to operate. 

New section 170VCB - Employment Advocate must approve, or refuse to approve, AWA  

3.30           Section 170VCB would provide for the approval of AWAs.  New subsection 170VCB(1) would require the Employment Advocate to approve an AWA if:

·                     the application has been made in accordance with section 170VC [paragraph 170VCB(1)(a)];

·                     the AWA satisfies the requirements of section 170VBA [paragraph 170VCB(1)(b)];

·                     the AWA complies with section 170VBB [paragraph 170VCB(1)(c)]; and

·                     subject to subsection 170VCB(2), the AWA passes the no-disadvantage test [paragraph 170VCB(1)(d)]. 

3.31           New subsection 170VCB(2) would provide that if the Employment Advocate has any concerns about whether the AWA meets the requirements of subsection 170VCB(1), the Employment Advocate would be required to give the parties to the AWA an opportunity to:

·                     take any action (including the giving of undertakings) [paragraph 170VCB(2)(a)]; or

·                     give the Employment Advocate any further information [paragraph 170VCB(2)(b)]. 

3.32           If these steps resolve the Employment Advocate’s concerns, the Employment Advocate would then be required to approve the AWA [subsection 170VCB(2)]. 

3.33           New subsection 170VCB(3) would provide that any undertakings accepted by the Employment Advocate are taken to be included in the AWA. 

3.34           New subsection 170VCB(4) would allow the Employment Advocate to approve an AWA in certain circumstances where the requirements of subsection 170VBA(1) have not been met in all respects.  This requirement would apply only where the Employment Advocate is satisfied that the failure to meet those requirements has not disadvantaged, and will not disadvantage, either party to the AWA 

3.35           New subsection 170VCB(5) would provide that where the Employment Advocate is not satisfied that an AWA passes the no-disadvantage test (see Part XIE), the Employment Advocate would be required to approve the AWA if satisfied that it is not contrary to the public interest to do so. 

3.36           New subsection 170VCB(6) would provide that in deciding whether the approval of an AWA is not contrary to the public interest, the Employment Advocate would have to apply the principles (if any) established by the President of the Commission under section 170VCC (see below). 

3.37           The effect of new subsection 170VCB(7) would be that if none of the preceding subsections require the Employment Advocate to approve an AWA, or the Employment Advocate did not approve the AWA under subsections (4) or (5), the Employment Advocate must refuse to approve it. 

New section 170VCC - Principles for deciding whether approval of an AWA etc.  is not contrary to the public interest  

3.38           Under proposed subsection 170VCC(1), the President of the Commission could establish principles to provide general guidance to the Employment Advocate concerning whether the approval of an AWA (or an AWA as varied) is not contrary to the public interest. 

3.39           New subsection 170VCC(2) would permit the President to establish such principles at his or her own initiative, or upon application by the Employment Advocate. 

3.40           Under new subsection 170VCC(3), if the Employment Advocate applies to the President for the establishment of principles, the President would be required to take such steps as he or she considers appropriate to ascertain the Employment Advocate’s views about the proposed principles. 

New section 170VCD - Employment Advocate must issue approval or refusal notice  

3.41           New subsections 170VCD(1) and (2) would require the Employment Advocate to issue either an approval notice or a refusal notice to the employer. 

3.42           New subsection 170VCD(3) would require that, where the Employment Advocate has designated an award for the purposes of the no-disadvantage test (see Part VIE of the WR Act), the approval or refusal notice must identify the designated award. 

3.43           Under new subsection 170VCD(4), an approval notice would be required to include copies of any provisions included by reason of subsections 170VBB(1) (model anti-discrimination provisions), 170VBB(2) (model dispute resolution procedure) or 170VCB(3) (undertakings). 

New section 170VCE - Consequences for AWA of failure to apply for approval, or refusal of approval  

3.44           New section 170VCE would set out what happens when an AWA is not approved because of either failure to apply for approval of an AWA within 60 days of the AWA date or the issuing of a refusal notice. 

3.45           Proposed subsection 170VCE(1) would provide that if no application is made for approval of an AWA within 60 days:

·                     where the AWA has started operating, the AWA stops operating after the end of the 60 day period [paragraph 170VCE(1)(a)];

·                     if the AWA has not started operating, it does not start operating (an AWA may not have started operating in circumstances in which it has been signed well in advance of the commencement of employment or the date specified in the AWA as the start date) [paragraph 170VCE(1)(b)]; and

·                     where paragraph (a) or (b) applies, the Employment Advocate is not permitted to approve the AWA [paragraph 170VCE(1)(c)]. 

3.46           New subsection 170VCE(2) would provide that if the Employment Advocate issues a refusal notice in relation to the AWA:

·                     where the AWA has started operating, the AWA stops operating at the end of the day the refusal notice is issued [paragraph 170VCE(2)(a)];

·                     if the AWA has not started operating, it does not start operating (an AWA may not have started operating in circumstances in which it has been signed well in advance of the commencement of employment or the date specified in the AWA as the start date) [paragraph 170VCE(2)(b)]; and

·                     where paragraph (a) or (b) applies, the Employment Advocate is not permitted to approve the AWA [paragraph 170VCE(2)(c)]. 

New section 170VCF - Employer must give copies of documents to employee  

3.47           Proposed subsection 170VCF(1) would require that, as soon as practicable after the employer has received a copy of the approval or refusal notice, the employer must provide a copy of the notice to the employee, together with any material taken to be included in the AWA by reason of section 170VBB(1) (model anti-discrimination provisions), 170VBB(2) (model dispute resolution procedure) or 170VCB(3) (undertakings).  (The requirement to provide the employee with a copy of the AWA is provided for in section 170VBA.)  Proposed subsection 170VCF(2) would require the employer to provide the employee with any other document if required to do so by the regulations. 

New Division 4 - Effect of an AWA

New section 170VD - Effect of AWAs on awards and agreements  

3.48           New section 170VD would set out the effect of an AWA on Awards and Agreements.  It replicates, in its entirety, existing section 170VQ of the Workplace Relations Act 1996

3.49           New subsection 170VD(1) would provide that (subject to proposed new subsections 170VD(2) and 170VD(3)), an AWA completely excludes the operation of any federal award which would otherwise apply to the employee’s employment.  Where the proposed new subsection applies, therefore, there would be no room for the application of award provisions; the AWA would effectively ‘cover the field’ to the exclusion of any award.

3.50           New subsection 170VD(2) would provide that an award made under subsection 170MX(3) (ie an award made upon the termination of a bargaining period) renders ineffectual an AWA made after the commencement of the award, but before the nominal expiry date of the award.

3.51           New subsection 170VD(3) would provide that an AWA prevails, to the extent of any inconsistency, over an exceptional matters order.  In such a case, the AWA will not be taken to ‘cover the field’ to the exclusion of the exceptional matters order.  The exceptional matters order could operate in conjunction with the AWA, provided that it was not directly inconsistent with the AWA.

3.52           New subsection 170VD(4) provides that an AWA operates to the exclusion of any State award or State agreement that would otherwise apply to the employee’s employment.

3.53           New subsection 170VD(5) deals with the order of precedence where a certified agreement and an AWA have been made in respect of the same employee.

3.54           A certified agreement will prevail over an AWA to the extent of any inconsistency if:

·          the certified agreement is already in operation but has not passed its nominal expiry date at the time the AWA comes into operation; and

·          the certified agreement does not expressly allow a subsequent AWA to displace it or to prevail to the extent of any inconsistency

3.55           A certified agreement will prevail over the AWA to the extent of any inconsistency where the certified agreement comes into operation after the nominal expiry date of the AWA.

3.56           In all other cases, an AWA will operate to the exclusion of a certified agreement

New section 170VDA - Effect of AWA on other laws  

3.57           New section 170VDA would set out the relationship between AWAs and State and other Commonwealth laws. 

3.58           New subsection 170VDA(1) would provide that, subject to the exceptions contained in this section, an AWA prevails over conditions of employment specified in State laws to the extent of any inconsistency. 

3.59           New subsection 170VDA(2) proposes exceptions to this general rule.  Provisions in an AWA which deal with occupational health and safety, workers compensation, apprenticeship or any other matters prescribed by the regulations would operate subject to the provisions of any State law which deal with those matters.  This is intended to ensure that these fundamental matters are dealt with consistently while still enabling the parties to address the issue in the AWA if they wish to do so.  The regulations could also prescribe other matters that are to operate subject to a State law. 

3.60           New subsection 170VDA(3) would ensure that State laws providing a remedy for termination of employment are still to be available, where they are able to operate concurrently with the AWA. 

3.61           New subsection 170VDA(4) would provide that to the extent of any inconsistency, an AWA prevails over prescribed conditions of employment which are specified in a Commonwealth law which is prescribed by the regulations. 

3.62           New subsection 170VDA(5) defines the terms Commonwealth law, prescribed conditions and State law.

New section 170VDB - Parties must not breach AWA  

3.63           New subsection 170VDB would require that a party to an AWA must not breach the AWA.  Contravention of this subsection could lead to the imposition of a civil penalty (see section 170VV). 

New section 170VDC - Industrial action etc.  by party to AWA  

3.64           New subsection 170VDC(1) would prevent an employee whose employment is covered by an AWA from engaging in industrial action in relation to the employment to which the AWA relates during the period of operation of the AWA before its nominal expiry date. 

3.65           New subsection 170VDC(2) would prevent an employer locking out an employee who is covered by an AWA during the period of operation of the AWA, but before the nominal expiry date of the AWA, for the purpose of supporting or advancing claims in respect of the employee’s employment. 

3.66           A civil penalty could be imposed in respect of a breach of either subsection 170VDC(1) or (2) (see section 170VV). 

New section 170VDD - Employer’s successor and AWA to which employer is a party  

3.67           Proposed section 170VDD would specify the circumstances in which AWAs bind a successor, transmittee or assignee employer. 

3.68           Subsection 170VDD(2) would make it clear that the rights and obligations of the previous employer which arose before the succession of the business or undertaking are not affected. 

3.69           Subsection 170VDD(3) would provide that for the purposes of this section, a successor includes a transmittee or assignee. 

New Division 5 - Extending, varying or terminating an AWA

New Subdivision A - Extension agreements

New section 170VE - Agreement to extend AWA’s nominal expiry date  

3.70           Proposed section 170VE would allow parties to an AWA to make a written agreement to extend the AWA’s nominal expiry date.  Such an agreement could only be made before the AWA’s nominal expiry date and the extended date could not be more than 3 years after the AWA date [new subsections 170VE(1) and (2)]. 

3.71           Proposed subsection 170VE(3) would provide that an extension agreement will be made when it is signed and dated by the parties to the agreement.  The employee would have to genuinely consent to making the extension agreement [new subsection 170VE(4)]. 

3.72           An employee may withdraw his or her consent to the extension agreement by giving writing notice of the withdrawal of consent to the employer and the Employment Advocate before the end of the cooling off period [new subsection 170VE(5)].  The cooling off period is period of 14 days after the day on which the employee signs the agreement.

3.73           The agreement would come into effect on the day when both parties have signed the agreement [subsection (170VE(5)], subject to section 170VEC (which deals with the consequences of failing to apply for approval, or refusal of approval, of the variation agreement).

New section 170VEA - Application for approval of extension agreement  

3.74           Proposed section 170VEA would set out the application process for approval of extension agreements. 

3.75           Under proposed subsection 170VEA(1), an employer would be required to apply for approval of the extension agreement within 60 days of the day when the agreement takes effect. 

3.76           Under proposed subsection 170VEA(2), the application would be required to be accompanied by a copy of the agreement, together with any information required by the Employment Advocate (as specified by a Gazette notice). 

3.77           Two or more agreements could be included in the same notice of application for approval.  The agreements need not be in the same terms [new subsection 170VEA(3)]. 

New section 170VEB - Employment Advocate must approve, or refuse to approve, extension agreement  

3.78           New section 170VEB would require the Employment Advocate to approve an extension agreement if the application has been made in accordance with section 170VEA and the agreement satisfies the requirements of section 170VE [new subsection 170VEB(1)].

3.79           If the Employment Advocate is not satisfied that the requirements set out in subsection 170VE(3) have been met in all respects, the Employment Advocate may still approve the extension agreement if he or she is satisfied that the failure to meet those requirements has not disadvantaged, and will not, disadvantage either party to the AWA [new subsection 170VEB(2)]. 

3.80           New subsections 170VEB(3), (4), (5) and (6) would set out the proposed requirements in relation to the issuing of approval and refusal notices by the Employment Advocate and the provision of a copy of the notice, the approved agreement and any other prescribed information to the employee. 

New section 170VEC - Consequences for extension agreement of failure to apply for approval or refusal of approval  

3.81           Proposed subsection 170VEC(1) would provide that if an employer fails to apply for approval of an extension agreement within 60 days of the starting day of the agreement the agreement would cease operating after the end of that period and the Employment Advocate cannot approve the extension agreement. 

3.82           Under proposed subsection 170VEC(2), the issuing of a refusal notice in relation to an extension agreement would cause the extension agreement to cease to operate from the end of the day on which the notice was issued. 

New Subdivision B - Variation agreements

New section 170VED - Agreement to vary an AWA  

3.83           New subsection 170VED(1) would provide that parties to an AWA may enter into a written agreement to vary the terms of the AWA.  (A variation agreement may vary the AWA’s nominal expiry date.  That is, where the parties agree to vary the nominal expiry date as well as other terms of the agreement, it would not be necessary to make separate extension and variation agreements).  A variation agreement would be made when it is signed and dated by the parties to the agreement. 

3.84           New subsections 170VED(2) and (3) would provide for a cooling-off period during which an employee may withdraw his or her consent to the variation agreement.  The cooling-off period is the period of 14 days after the day on which the employee signs the agreement.  This cooling-off period would operate in the same manner as the cooling-off period applicable to AWAs. 

3.85           New subsection 170VED(4) would provide that subject to sections 170VEF (which deals with withdrawal of consent) and 170VEJ (which deals with the consequences of failure to apply for approval and refusal of approval) a variation agreement takes effect on the day on which the parties sign the agreement (or the later day if signed on different days), or, if later, on the day specified in the agreement. 

3.86           Proposed subsections 170VBA and 170VBB would apply to the AWA as varied.  That is, the employee would be required to genuinely consent to the terms and conditions in the variation agreement, the employer would be required to give the employee a copy of the agreement and before the employee signs the agreement, the employer would be required to give the employee a copy of an information statement prepared by the Employment Advocate and explain the effect of the agreement to the employee.  The AWA as varied would have to include the prescribed anti-discrimination provisions and a dispute resolution procedure.  The AWA as varied could not include any provisions which would prohibit or restrict either party to the AWA from disclosing details of the AWA to another person and could not include any objectionable provisions within the meaning of section 298Z of the WR Act. 

New section 170VEE - Applications for approval of variation agreements  

3.87           Proposed section 170VEE would set out the requirements for applications for approval of variation agreements.  These requirements would operate in the same way as the proposed requirements for applications for approval of an AWA. 

New section 170VEF - Consequences for variation agreement of employee’s withdrawal of consent  

3.88           New section 170VEF would set out the consequences of the withdrawal of consent.  If an eligible employee withdraws his or her consent to the variation agreement before the end of the cooling-off period, the agreement would be taken not to have started to operate. 

New section 170VEG - Employment Advocate must approve, or refuse to approve, variation agreement  

3.89           New section 170VEG proposes requirements for approval of a variation agreement.  These requirements would operate in the same way as the proposed requirements for approval of an AWA as set out in section 170VCB. 

New section 170VEH - Employment Advocate must issue approval or refusal notice  

3.90           New section 170VEH proposes requirements applicable to the issuing of approval and refusal notices in respect of variation agreements.  New subsection 170VEH(1) would require the Employment Advocate to issue an approval notice in respect of an approved variation agreement and provide a copy of the notice and the agreement to the employer.  New subsection 170VEH(2) would require the Employment Advocate to issue to the employer a refusal notice in respect of a variation agreement that has been refused. 

New section 170VEI - Employer must give copies of documents to employee  

3.91           New section 170VEI would specify the information that the employer must provide to the employee after receiving an approval or refusal notice from the Employment Advocate.  Proposed subsection 170VEI(1) would require that as soon as practicable after the employer has received a copy of the approval or refusal notice, the employer must provide a copy of the notice to the employee, together with a copy of the variation agreement and any material taken to be included in the AWA as varied by reason of subsections 170VBB(1) (model anti-discrimination provisions), 170VBB(2) (model dispute resolution procedure) or 170VEG(3) (undertakings). 

3.92           New subsection 170VEI(2) would provide for regulations to prescribe additional requirements as to material to be provided to the employee. 

New section 170VEJ - Consequences for variation agreement of failure to apply for approval or refusal of approval  

3.93           New section 170VEJ would set out what happens when a variation agreement is not approved because of either failure to apply for approval within 60 days of the AWA date or the issuing of a refusal notice. 

3.94           Proposed subsection 170VEJ(1) would provide that:

·                     where the variation agreement has already taken effect, it ceases to have effect after the end of the 60 day period [paragraph 170VEJ(1)(a)];

·                     if the variation agreement has not already taken effect, it does not take effect [paragraph 170VEJ(1)(b)]; and

·                     where paragraph (a) or (b) applies, the Employment Advocate is not permitted to approve the AWA [paragraph 170VEJ(1)(c)]. 

3.95           New subsection 170VEJ(2) would provide that:

·                     where the variation agreement has already taken effect, it ceases to have effect at the end of the day the refusal notice is issued [paragraph 170VEJ(2)(a)]; and

·                     if the variation agreement has not already taken effect, it does not take effect [paragraph 170VEJ(2)(b)]. 

New Subdivision C - Terminating an AWA

New section 170VEK - Terminating an AWA 

3.96           New section 170VEK would set out the three ways in which an AWA may be terminated:

·                     by a termination agreement as provided for in sections 170VEL and 170VEN;

·                     by the Employment Advocate on application of an AWA party as provided for in section 170VEO; and

·                     in accordance with a provision in the AWA as provided for in sections 170VEP and 170VEQ. 

New section 170VEL - Termination agreement  

3.97           New subsection 170VEL(1) would allow the parties to an AWA at any time to make a written agreement to terminate the AWA.  Proposed subsection 170VEL(2) would provide that the termination agreement will be made when it is signed and dated by the parties to the agreement.  The employee would be required to genuinely consent to making the termination agreement [new subsection 170VEL(3)]. 

3.98           An employee may withdraw his or her consent to the termination agreement by giving writing notice of the withdrawal of consent to the employer and the Employment Advocate before the end of the cooling off period [new subsection 170VEL(4)].  The cooling off period is period of 14 days after the day on which the employee signs the agreement [new subsection 170VEL(5)].

3.99           A termination agreement would be required to be approved by the Employment Advocate, and if approved, it would come into effect on the day on which the approval notice is issued, or a later date if specified in the termination agreement [subsection 170VEL(4)].  If the agreement is not approved by the Employment Advocate, it does not take effect.

New section 170VEM - Application for approval of termination agreement  

3.100       New section 170VEM would set out the requirements for an application for approval of a termination agreement. 

3.101       Under proposed subsection 170VEM(1), an employer would be required to apply in writing to the Employment Advocate for approval of the termination agreement.  The application would have to be made within 60 days of the agreement being made [new subsection 170VEM(2)].

3.102       Under proposed subsection 170VEM(3), the application would be required to be accompanied by a copy of the agreement, together with any information required by the Employment Advocate (as specified by a Gazette notice). 

3.103       Two or more agreements could be included in the same notice of application for approval.  The agreements need not be in the same terms [new subsection 170VEM(4)]. 

New section 170VEN - Employment Advocate must approve, or refuse to approve, termination agreement  

3.104       New section 170VEN would require the Employment Advocate to approve a termination agreement if the application has been made in accordance with section 170VEM and the agreement satisfies the requirements of section 170VEL [new subsection 170VEN(1)]. 

3.105       If the Employment Advocate is not satisfied that the requirements set out in paragraphs 170VEN(1)(a) and (b) have been met in all respects, the Employment Advocate may  approve the termination agreement if he or she is satisfied that the failure to meet those requirements has not disadvantaged, and will not disadvantage, either party to the AWA [new subsection 170VEN(2)]. 

3.106       New subsections 170VEN(3), (4), (5) and (6) would set out the proposed requirements in relation to the issuing of approval and refusal notices by the Employment Advocate and the provision of a copy of the notice, the approved agreement and any other prescribed information to the employee. 

New section 170VEO - Termination by Employment Advocate  

3.107       New section 170VEO would provide for an AWA party to apply to have the AWA terminated.  Applications would be made in writing to the Employment Advocate after the AWA’s nominal expiry date [new subsection 170VEO(1)]. 

3.108       Before making a determination in respect of an application to terminate an AWA, the Employment Advocate would be required to take such steps as he or she considers appropriate to obtain the views of each of the parties about whether the agreement should be terminated [new subsection 170VEO(2)]. 

3.109       The Employment Advocate would be required to issue a determination in respect of an application under subsection 170VEO(1).  If the Employment Advocate determines that the AWA should be terminated, the termination would take place at the end of the day the determination is issued and or a later time if specified in the determination [new subsections 170VEO(3) and (4)]. 

New section 170VEP - Termination in accordance with the AWA  

3.110       New section 170VEP would provide for the termination of an AWA in the manner provided for in the AWA.  Such terminations would need to be approved by the Employment Advocate to ensure that they comply with the terms of the relevant AWA.  Applications would be required to be made in writing to the Employment Advocate after the AWA’s nominal expiry date [new subsection 170VEP(1)].  The applicant would be required to notify the other party to the AWA of the application as soon as practicable after it is made [new subsection 170VEP(2)].

3.111       New subsection 170VEP(3) would set out the requirements for an application under subsection 170VEP(1).  The application would be required to be accompanied by details of the manner of termination provided for in the AWA and any other information the Employment Advocate requires (as specified by a Gazette notice). 

3.112       The termination of two or more agreements could be covered in the same notice of application if the applicant is the employer and the employer is a party to all the AWAs to which the notice of application applies.  The terminations need not be in the same terms [new subsection 170VEP(4)]. 

3.113       New subsection 170VEP(5) would provide that a termination in accordance with an AWA comes into effect on the day on which the approval notice is issued, or a later date if specified in the application. 

New section 170VEQ - Employment Advocate must approve, or refuse to approve, terminations under AWAs  

3.114       New section 170VEQ would require the Employment Advocate to approve an application if it has been made in accordance with section 170VEP, the applicant has notified the other party of the application and the termination is in accordance with the AWA [new subsection 170VEQ(1)]. 

3.115       New subsections 170VEQ(2), (3), (4) and (5) would set out the proposed requirements in relation to the issuing of approval and refusal notices by the Employment Advocate and the provision of a copy of the notice and any other prescribed information by the applicant to the other party. 

Item 2 - At the end of subsection 170VV(1)  

3.116       Section 170VV sets out the penalties for contravening this Part.  This item proposes to add a new provision to make it clear that the penalties are civil penalties.  A legislative note would replace the existing heading to the section, ‘Penalties for contravening this Part’, with a new heading, ‘Civil penalties’. 

Item 3 - Subsection 170VV(3)  

3.117       Subsection 170VV(1) provides that an eligible court may impose a penalty on a person who contravenes a penalty provision.  Existing subsection 170VV(3) provides that an application for an order under subsection 170VV(1) that relates to an AWA or ancillary document may be made by a party to the AWA or ancillary document.  New subsection 170VV(3) would permit an application for an order under subsection 170VV(1) to be made by the Employment Advocate or an authorised officer (as defined in section 83BG) or by a party to the AWA or ancillary document. 

Item 4 - Subsection 170VV(4) (definition of penalty provision )  

3.118       This item would repeal existing subsection 170VV(4), which lists the sections of Part VID which are penalty provisions, and replace it with a revised list reflecting the repeal and insertions of sections to which penalties apply. 

Item 5 - After section 170VV  

New section 170VVA - Eligible court may order employer to pay underpayment to employee  

3.119       This item would insert new section 170VVA, which would permit a court, in a proceeding under section 170VV, to order an employer to make a payment to an employee in respect of any underpayment of entitlements under an AWA.  The power to make such an order is additional to the power to impose a penalty under subsection 170VV(1). 

3.120       New subsection 170VVA(2) would limit the scope of orders under subsection 170VVA(1) to exclude underpayments relating to any period more than 6 years before the commencement of the proceedings.  This limit is consistent with the time limit on recovery of underpayments imposed by subsection 179(1) in respect of breaches of awards and certified agreements. 

Item 6 - At the end of section 170VW  

3.121       This item would insert new subsection 170VW(3), which would ensure that, to the extent that the relevant loss had been recovered through an order made under subsection 170VV(3), an employee could not recover damages for a breach of an AWA. 

Item 7 - Section 170VX  

3.122       This item would repeal existing section 170VX (which deals with compensation for shortfalls for new employees whose AWAs are subsequently refused approval) and insert new sections 170VX, 170VXA, 170VXB and 170VXC.  The new sections would also provide for the recovery of compensation for shortfalls, but they substantially widen the circumstances in which compensation may be recovered.  The new sections providing for the recovery of compensation take account of the new sections providing for the commencement of AWAs and variation agreements, the effect of which would be that most AWAs and variation agreements (including those for existing employees) would start to operate before they are assessed by the Employment Advocate. 

3.123       The new provisions would also widen access to recovery of compensation where an AWA has been approved on the basis of undertakings or other action, and the undertakings have been breached or other action has not been taken as required. 

3.124       In each case, the employee (or the Employment Advocate or an authorised officer on the employee’s behalf) could make a claim in an eligible court for this amount (an eligible court is defined in new section 170VA). 

New section 170VX - Compensation for shortfall in entitlements - AWA not operating

3.125       New subsection 170VX(1) would allow an employee (or the Employment Advocate or an authorised officer on the employee’s behalf) to claim compensation in the event that he or she was disadvantaged by making an AWA that subsequently stopped operating for one of the reasons set out in subsection 170VX(2).  (The reasons specified in subsection 170VX(2) are that the AWA was subsequently refused approval or that the employer failed to apply for the AWA’s approval as required by new subsection 170VC(2).)  

3.126       New subsection 170VX(1) would provide a formula for calculating the amount of compensation payable. 

New section 170VXA - Compensation for shortfall in entitlements - AWA approved after employer’s action  

3.127       New subsection 170VXA(1) would allow an employee (or the Employment Advocate or an authorised officer on the employee’s behalf) to claim compensation where his or her entitlements under an AWA are increased as a result of a requirement that the employee’s employer give undertakings or take other action in order for an AWA to be approved. 

3.128       New subsection 170VXA(2) would provide a formula for calculating the amount of compensation payable. 

New section 170VXB - Compensation for shortfall in entitlements - variation agreement ceasing to have effect  

3.129       New subsection 170VXB(1) would allow an employee (or the Employment Advocate or an authorised officer on the employee’s behalf) to claim compensation where a variation agreement has stopped operating for one of the reasons set out in subsection 170VXB(2).  (The reasons specified in subsection 170VXB(2) are that the variation agreement was subsequently refused approval or that the employer failed to apply for the approval of the agreement as required by new section 170VEE(2).)  

3.130       New subsection 170VXB(1) would provide a formula for calculating the amount of compensation payable. 

New section 170VXC - Compensation for shortfall in entitlements - variation agreement approved after employer’s action  

3.131       New subsection 170VXC(1) would allow an employee (or the Employment Advocate or an authorised officer on the employee’s behalf) to claim compensation where his or her entitlements under an AWA, as varied by a variation agreement, were increased as a result of a requirement that the employee’s employer give undertakings or take other action in order for an AWA to be approved. 

3.132       New subsection 170VXC(2) would provide a formula for calculating the amount of compensation payable. 

Item 8 - At the end of subsection 170WE(1)  

3.133       This item would amend subsection 170WE(1) by inserting a note indicating that a civil penalty is applicable to a breach of this provision. 

Item 9 - Before section 170WF  

3.134       This item would insert a new section 170WAA which sets out the requirements relating to bargaining agents, as follows. 

New section 170WEA - Bargaining agents  

3.135       New subsection 170WEA(1) would provide that either of the parties may appoint a bargaining agent to negotiate an AWA.  This appointment would be required to be in writing.  Subsection 170WAA(5) would provide that a bargaining agent may be a group of persons. 

3.136       New subsection 170WEA(2) would provide that a party must not refuse to recognise the appointment of a duly appointed bargaining agent by the other party for the purposes of new subsection 170WAA(1).  Contravention of this section could lead to the imposition of a monetary penalty.  If a person did not wish to negotiate the making of an AWA, that would not constitute a refusal to recognise a bargaining agent. 

3.137       New subsection 170WEA(3) would provide that a party is not in breach of new subsection 170WAA(2) if they were not given a copy of the bargaining agents instrument of appointment before the refusal. 

3.138       New subsection 170WEA(4) would provide that a party must not coerce or attempt to coerce the other party:

·                     to appoint or not to appoint a particular person as their authorised bargaining agent; or

·                     to terminate the appointment of their authorised bargaining agent. 

3.139       The contravention of this provision could lead to the imposition of a civil penalty. 

Item 10 - At the end of subsection 170WF(1)

Item 11 - At the end of subsection 170WG(1)

Item 12 - At the end of subsection 170WG(2)  

3.140       These items would amend subsections 170WF(1), 170WG(1) and 170WG(2) by inserting notes indicating that civil penalties are applicable to breaches of these provisions. 

Item 13 - Section 170WH  

New section 170WH - Information must not be false or misleading  

3.141       This item would repeal existing section 170WH and replace it with a new provision to the effect that a person must not give the Employment Advocate information for the purposes of this Part that the person knows or ought reasonably to know is false or misleading. 

3.142       The contravention of this provision could lead to the imposition of a civil penalty. 

3.143       In determining whether a person ought reasonably to know that information is false or misleading, it would be appropriate to have regard to the persons abilities, experience, qualifications and other attributes and to all the other circumstances surrounding the alleged contravention. 

Item 14 - Subsection 170WHA(1)  

3.144       This item proposes a minor technical amendment consequent upon the replacement of filing requirements with approval requirements. 

Item 15 - Sections 170WHB, 170WHC and 170WHD  

3.145       This item would repeal sections 170WHB, 170WHC and 170WHD which concern the Commission’s functions with respect to AWAs.  These provisions would not be required as a consequence of the repeal of Subdivision C of Division 5 of Part VID and subsections 170VM(3), (4) and (5), which provide for the approval of AWAs and variation agreements and the termination of AWAs by the Commission.  These functions would be transferred to the Employment Advocate by item 2. 

Item 16 - Subsection 170WI(1)  

3.146       This item proposes a minor technical amendment consequent upon the replacement of filing requirements with approval requirements.

Item 17 - Subsection 170WI(1)  

3.147       This item would omit a reference to the Commission in subsection 170WI(1) consequent upon the transfer to the Employment Advocate of the Commission’s functions with respect to the approval of AWAs and variation agreements and the termination of AWAs. 

Item 18 - Paragraph 170WI(2)(a)  

3.148       This item proposes a minor technical amendment consequent upon the replacement of filing requirements with approval requirements. 

Item 19 - Paragraph 170WI(2)(b)  

3.149       This item would omit a reference to the Commission in paragraph 170WI(2)(b) consequent upon the transfer to the Employment Advocate of the Commission’s functions with respect to the approval of AWAs and variation agreements and the termination of AWAs. 

Item 20 - Paragraph 170WI(2)(c)  

3.150       This item would repeal existing paragraph 170WI(2)(c) and replace it with a new paragraph to reflect the replacement of filing requirements with approval requirements. 

Item 21 - Paragraph 170WL(d)  

3.151       This is a consequential amendment to remove existing paragraph 170WL(d), which provides that the regulations may make provision in relation to the witnessing of signatures on AWAs or ancillary documents.  Under other amendments proposed in this Schedule, an AWA, extension agreement, variation agreement or termination agreement will be required to be signed only by the employer and employee parties to the AWA.  As a consequence, the regulation-making power in paragraph 170WL(d) will no longer be necessary. 

 

Part 2 - Application and saving provisions

Item 22 - Application of items 1, 4, 7, 9 and 13 to 20  

3.152       This item would provide that items 1, 4, 7, 9 and 13 to 20 apply only to AWAs, extension agreements, variation agreements and termination agreements made on or after the commencement of those items. 

Item 23 - Application of items 3, 5 and 6  

3.153       The effect of this item is that items 3, 5 and 6 would apply to AWAs, extension agreements, variation agreements and termination agreements irrespective of the date they are or were made. 

Item 24 - Saving - AWAs

Item 25 - Saving - extension agreements

Item 26 - Saving - variation agreements

Item 27 - Saving - termination agreements  

3.154       The effect of these items is to provide for the continuing effect of AWAs, extension agreements, variation agreements and termination agreements approved in accordance with the requirements that applied before the commencement of the new approval provisions. 

Item 28 - Saving - regulations made for the purposes of former sections 170VG and 170VR  

3.155       This item would save regulations made for the purposes of former subsections 170VG(1) and (3) and 170VR(4).  These regulations would continue to have effect as if they had been made under the corresponding new provisions (as indicated in the table set out in this item) that would be inserted by item 1, that is, subject to any new regulations made for the purposes of the new provisions. 

Item 29 - Saving - Gazette notices  

3.156       This item would save Gazette notices published for the purposes of former paragraphs 170VO(1)(c), (3)(c), (4)(b), (5)(b) and (6)(b).  These notices would continue to have effect as if they had been made under the corresponding new provisions (as indicated in the table set out in this item) that would be inserted by item 1, that is, subject to any new Gazette notices published for the purposes of the new provisions. 

Item 30 - Saving - prescribed conditions  

3.157       This item would save regulations made for the purposes of former subsection 170VR(5).  These regulations would continue to have effect as if they had been made for the purposes of the definition of ‘prescribed conditions’ in new subsection 170VDA(5), that is, subject to any new regulations made for the purposes of the new definition.

Item 31 - Saving - appointment of bargaining agent  

3.158       This item would save appointments of bargaining agents made under former subsection 170VK(1).  Such appointments would continue in force as if they had been made under new subsection 170WEA.

Item 32 - Definitions

3.159       This item defines the terms ‘amended Act’, ‘former provision’ and ‘new provision’ as used in Part 2 of this Schedule.

 

 



SCHEDULE 4 - CERTIFIED AGREEMENTS

 

4.1   This Schedule proposes amendments to the certified agreement provisions of the Workplace Relations Act 1996 .

4.2   The new provisions are intended to make agreement making easier and more widely accessible, to reduce the formality and cost involved in having an agreement certified, and to prevent unwarranted interference by third parties in agreement making.  These objectives would be achieved by:

  • providing that, in cases where an application to certify, extend, vary or terminate a certified agreement is considered by the Commission, no formal hearing should be held unless it is necessary in the circumstances (although allowing employees and other defined persons to request that the Commission conduct a hearing);

 

  • removing the entitlement of employee organisations to prevent the extension, variation or termination of section 170LK agreements, while still retaining a role for such organisations where requested by a member;

 

·          making a number of minor amendments and correcting technical defects.



Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - Paragraph 170LJ(3)(a)  

4.3   This item proposes an amendment to address a technical defect, concerning the process for approval by employees of agreements made under section 170LJ (agreements between employers and organisations of employees).  It is intended to provide that, where a new employee or employees commence work with the employer during the 14 day period prior to approval of the agreement, the employer must take steps to provide those employees with access to the agreement before approval is given.  The requirement for a minimum of 14 days notice would not apply in relation to such employees.  (Paragraph 170LJ(3)(b) continues to require that the agreement be explained, before approval, to all persons whose employment will be subject to the agreement.)

Item 2 - After subsection 170LJ(3)

4.4   This item relates to proposed new section 170LVA, which will provide that the Australian Industrial Relations Commission (AIRC) should generally determine whether or not to certify an agreement without conducting a hearing.  However, that section also specifies persons who may apply to the AIRC to request a hearing be conducted in respect of a proposed agreement.  One such person is a person whose employment will be subject to the agreement. 

4.5   This item will insert a new subsection 170LJ(3A), which will require an employer to take reasonable steps, within 7 days of the agreement being approved by a valid majority of employees, to inform each person whose employment will be subject to the agreement of their right to request such a hearing and that the request must be made no later than 28 days after the agreement is approved.

Item 3 - Subsection 170LK(2)

4.6   This item would effect an amendment to address a technical defect, concerning the process for approval by employees of agreements made under section 170LK (agreements between employers and their employees).  It is intended to provide that, where a new employee or employees commence work with the employer during the 14 day period prior to approval of the agreement, the employer must take steps to provide those employees with access to the agreement before approval is given.  The requirement for a minimum of 14 days notice would not apply in relation to such employees (new paragraph (c) would require that the agreement be explained, before it is made, to all persons whose employment will be subject to the agreement.)

4.7   This item would also incorporate into subsection 170LK(2) the existing requirement in subsection 170LK(7) for the employer to take reasonable steps to ensure that the terms of the agreement are explained to all the persons employed at the time whose employment will be subject to the agreement. 

Item 4 - Subsection 170LK(7)

4.8   This item would repeal existing subsection 170LK(7) (which would be incorporated into new subsection 170LK(2)) and insert a new subsection 170LK(7).  The new subsection 170LK(7) would require an employer to take reasonable steps, within 7 days of the agreement being approved by a valid majority of employees, to inform each person whose employment will be subject to the agreement of their right to request the Commission to conduct a hearing regarding whether or not to certify the agreement and that the request must be made no later than 28 days after the agreement is approved (hearings are dealt with in proposed new section 170LVA).

Item 5 - Subsection 170LK(8)

4.9    This item proposes consequential amendments to reflect the changes made by items 3 and 4.

Item 6 - At the end of section 170LK

4.10           This item proposes to add a note after subsection 170LK(8).  The note would refer readers to the Commission’s power under the proposed new subsection 170LT(11) to dispense with compliance with subsection 170LK(8) in certain cases.

Item 7 - Paragraph 170LR(2)(a)

4.11           This item proposes an amendment to address a technical defect, concerning the process for approval by employees of agreements made under Division 3 (agreements between employers and organisations of employees).  It is intended to provide that, where an employee or employees commence work with the employer during the 14 day period prior to approval of the agreement, the employer must take steps to provide those employees with access to the agreement before approval is given.  The requirement for a minimum of 14 days notice would not apply in relation to such employees.  (Paragraph 170LR(2)(b) continues to require that the agreement be explained, before approval, to all persons whose employment will be subject to the agreement.)

Item 8 - At the end of section 170LR

4.12           This items proposes a new subsection 170LR(3) which would require an employer to take reasonable steps, within 7 days of the agreement being approved by a valid majority of employees, to inform each person whose employment will be subject to the agreement of their right to request such a hearing and that the request must be made no later than 28 days after the agreement is approved (hearings are dealt with in proposed new section 170LVA).

Item 9 - Subsection 170LT(7)

4.13           This item updates references in subsection 170LT(7) to other subsections that will be renumbered as a consequence of other proposed amendments.

Item 10 - At the end of section 170LT

4.14           This item proposes a new subsection 170LT(11).  This would allow the Commission to certify an agreement if the requirements of subsection 170LK(8)(which deals with the variation of a proposed agreement) were not satisfied but the Commission was satisfied that no person whose employment would be covered by the proposed agreement suffered detriment as a result of that failure.

Item 11 - After section 170LV

New section 170LVA - Hearings not required

4.15           This item would insert a new section 170LVA, which would require the Commission to decide whether or not to certify an agreement without holding a hearing unless it is not satisfied that it can make that decision with the information available to it or a hearing is requested by one of the persons set out in subsection 170LVA(b) and the Commission is satisfied that there are reasonable grounds for doing so.

4.16           The persons who may request a hearing are:

·          The employer [subparagraph 170LVA(1)(b)(i)];

·          A person whose employment will be subject to the agreement [subparagraph 170LVA(1)(b)(ii)];

·          For section 170LJ, 170LL or Division 3 agreements- the one or more organisations of employees that made the agreement with the employer [subparagraph 170LVA(1)(b)(iii)];

·          For section 170LK agreements - an organisation of employees that has notified the Commission, and the employer, in writing that it wants to be bound by the agreement [subparagraph 170LVA(1)(b)(iv)];

·          A person prescribed by the regulations [subparagraph 170LVA(1)(b)(v)].

4.17           New subsection 170LVA(2) would require that the application requesting a hearing must be made within 28 days of the agreement being approved or made.

Item 12 - Subsection 170MC(1)

Item 13 - Paragraphs 170MC(1)(a) and (b)

Item 14 - After subsection 170MC(2)

Item 15 - After subsection 170MC(4)

Item 16 - Subsection 170MC(5)

 

4.18           These items will make a number of changes to section 170MC, which deals with extending the nominal expiry date of a certified agreement (where a valid majority approves).

4.19           At present, an organisation of employees bound by an agreement made in accordance with section 170LK (ie an agreement between an employer and the employer’s employees) must consent to an extension.  The amendments proposed by these items are intended to remove the entitlement of employee organisations to prevent the extension of section 170LK agreements, while still retaining a role for such organisations where requested by a member

4.20           Item 13 would replace paragraphs 170MC(1)(a) and (b).  New paragraphs (1)(a) and (b) would provide that an application for Commission approval of an extension to the nominal expiry date must be made by:

·   in the case of an agreement between an employer and one or more employee organisations under section 170LJ or Division 3 (the duration of a ‘greenfields’ agreement made under section 170LL may not be extended) - the employer and one or more of the organisations bound by the agreement; or

·   in the case of an agreement between an employer and the employer’s employees made in accordance with section 170LK - the employer.

 

4.21           Item 14 proposes to insert new subsections (2A) and (2B) to ensure that an organisation bound by a section 170LK agreement could make submissions in relation to the proposed extension if asked to do so by a member of the organisation:

·   whose employment is subject to the agreement; and

·   whose industrial interests the organisation is entitled to represent.

4.22           Item 15 reflects that, as with the certification of agreements, the Commission is not required to hold a hearing in respect of an application to extend an agreement (see section 170MHB). 

4.23           Consistent with provisions for certification, this item would insert new subsections 170MC(4A) and 170MC(4B) that will require an employer to take reasonable steps, within 7 days of the employer or the employer and the organisation(s) bound to the agreement extending the agreement, to inform each person whose employment will be subject to the agreement, of their right to request such a hearing and that the request must be made no later than 28 days after the agreement is approved (although the employer, or the employer and the organisation(s) bound to the agreement may, in writing, extend the agreement, this has no effect unless the Commission approves it - see existing s170MC(2)).

4.24           Items 12 and 16 propose consequential amendments

Item 17 - Paragraphs 170MD(1)(a) and (b)

Item 18 - After subsection 170MD(2)

Item 19 - After subsection 170MD(5)

 

4.25           These items propose amendments to section 170MD, which deals with variation of a certified agreement (where a valid majority approve).

4.26           At present an organisation of employees bound by an agreement made in accordance with section 170LK (ie an agreement between an employer and the employer’s employees) must consent to a variation.  The amendments proposed by these items are intended to remove the entitlement of employee organisations to prevent the variation of section 170LK agreements, while still retaining a role for such organisations where requested by a member.

4.27           Item 17 would replace paragraphs 170MD(1)(a) and (b).  New paragraphs (1)(a) and (b) would provide that an application for Commission approval of a variation must be made by:

·   in the case of an agreement between an employer and one or more employee organisations under section 170LJ, section 170LL or Division 3 - the employer and one or more of the organisations bound by the agreement; or

 

·   in the case of an agreement between an employer and the employer’s employees made in accordance with section 170LK - the employer

 

4.28           Item 18 proposes to insert new subsections (2A) and (2B) to ensure that an organisation bound by a section 170LK agreement could make submissions in relation to the proposed variation if asked to do so by a member of the organisation:

·   whose employment is subject to the agreement; and

 

·   whose industrial interests the organisation is entitled to represent

4.29           Consistent with provisions for application for certification of an agreement, item 19 would insert new subsections 170MD(5A) and 170MC(5B) that will require an employer to take reasonable steps, within 7 days of the employer, or the employer and the organisation(s) bound to the agreement, extending the agreement, to inform each person whose employment will be subject to the agreement, of their right to request such a hearing; and that the request must be made no later than 28 days after the agreement is approved  (although the employer, or the employer and the organisation(s) bound to the agreement may, in writing, vary the agreement, this has no effect unless the Commission approves it - see existing s170MC(2)).

Item 20 - Paragraphs 170MG(1)(a) and (b)

Item 21 - After subsection 170MG(2)

Item 22 - At the end of section 170MG

 

4.30           Items 20, 21 and 22 propose amendments to section 170MG, which deals with termination of a certified agreement at any time (where a valid majority approves).

4.31           At present, an organisation of employees bound by an agreement made in accordance with section 170LK (ie an agreement between an employer and the employer’s employees) must consent to a termination.  The amendments proposed by these items are intended to remove the entitlement of employee organisations to prevent the termination of a section 170LK agreement, while still retaining a role for such organisations where requested by a member.

4.32           Item 20 would replace paragraphs 170MG(1)(a) and (b).  New paragraphs (1)(a) and (b) would provide that an application for Commission approval of a termination must be made by

·                      in the case of an agreement between an employer and one or more employee organisations under section 170LJ, section 170LL or Division 3 - the employer and one or more of the organisations bound by the agreement; or

 

·                      in the case of an agreement between an employer and the employer’s employees made in accordance with section 170LK - the employer

4.33           Item 21 proposes to insert new subsections (2A) and (2B) to ensure that an organisation bound by a section 170LK agreement could make submissions in relation to the proposed termination if asked to do so by a member of the organisation:

·                whose employment is subject to the agreement; and

 

·                whose industrial interests the organisation is entitled to represent

4.34           Consistent with provisions for application for certification of an agreement, item 21 would insert new subsections 170MD(5A) and 170MC(5B) that will require an employer to take reasonable steps, within 7 days of the employer, or the employer and the organisation(s) bound to the agreement extending the agreement, to inform each person whose employment will be subject to the agreement, of their right to request such a hearing; and that the request must be made no later than 28 days after the agreement is approved  (although the employer, or the employer and the organisation(s) bound to the agreement may, in writing, vary the agreement, this has no effect unless the Commission approves it - see existing subsection 170MC(2)).

Item 23 - Paragraph 170MH(1)(c)

Item 24 - After subsection 170MH(2)

 

4.35           Section 170MH provides for termination of a certified agreement after the nominal expiry date.  Such an agreement may be terminated where to do so is not contrary to the public interest

4.36           Under subsection (1), an application for termination of an agreement that has passed its nominal expiry date may be made by the employer, a valid majority of employees or an organisation bound by the agreement.

4.37           The effect of the amendment proposed by item 23 would be to remove the entitlement of employee organisations to seek termination of a section 170LK agreement.  The right of such organisations to put their views on a proposed termination is governed by existing subsection (2) and proposed subsection (2A).

4.38           Item 24 proposes to insert new subsection 170MH(2A).  The amendment would provide that the Commission may only obtain the views of an organisation bound by a section 170LK agreement in respect of a proposed termination if it has been requested to make a submission by at least one member whose employment is subject to the agreement, and whose industrial interests the organisation is entitled to represent in relation to work that is subject to the agreement.

Item 25 - Paragraph 170MHA(2)(c)

Item 26 - After subsection 170MHA(3)

4.39           Items 25 and 26 propose amendments to section 170MHA, which deals with termination of a certified agreement in a manner provided for by the agreement

4.40           Under subsection (1), an application for termination of an agreement that has passed its nominal expiry date may be made by the employer, a valid majority of employees or an organisation bound by the agreement

4.41           The effect of the amendment proposed by item 25 would be to remove the entitlement of employee organisations to seek termination of a section 170LK agreement.

4.42           Such organisations would retain, as a result of amendments proposed by item 26, a right to make submissions in relation to a proposed termination if asked to do so by a member of the organisation:

·                      whose employment is subject to the agreement; and

 

·                      whose industrial interests the organisation is entitled to represent.

Item 27 - At the end of Division 7 of Part VIB

4.43           This item would insert a new section 170MHB, which would require the Commission to decide whether or not to extend, vary or terminate an agreement without holding a hearing unless it is not satisfied that it can make that decision with the information available to it or a hearing is requested by one of the persons set out in subsection 170MHB(b) and the Commission is satisfied that there are reasonable grounds for doing so.

4.44           The persons who may request a hearing are:

·        the employer [subparagraph 170MHB(1)(b)(i)];

·        a person whose employment will be subject to the agreement [subparagraph 170MHB(1)(b)(ii)];

·        one or more of the organisations bound by the agreement [subparagraph 170MHB(1)(b)(iii)]; and

·        a person prescribed by the regulations [subparagraph 170MHB(1)(b)(iv)].

4.45           New subsection 170MHB(2) would require that the application requesting a hearing must be made within 28 days of the agreement to extend, vary or terminate, or, in the case of sections 170MH and 170MHA, within 28 days of the application to terminate being made to the Commission.



Part 2 - Application and transitional provisions

Item 28 - Application of items 1 to 11

4.46           This item provides that the amendments made by items 1 to 11 would apply in relation to any agreement where the application to certify the agreement is made on or after the commencement of the Schedule.  The amendments also apply in relation to the applications to certify those agreements.

Item 29 - Application of items 12 to 27

4.47           This item provides that the amendments made by items 12 to 27 would apply to a decision made by the Commission on or after the commencement of the Schedule, about the extension, variation or termination of a certified agreement in respect of applications for the extension, variation or termination made on or after that commencement. 

Item 30 - Transitional provision - Rules of Commission

4.48           This item would insert a transitional provision requiring the President to exercise his powers under section 48 of the Workplace Relations Act 1996 to vary the rules of the Commission to allow for the electronic lodgement of applications (and ancillary documents in relation to such applications) to the Commission under Part VIB of the Act.

 

 

 



SCHEDULE 5 - SECONDARY BOYCOTTS

 

 

Part 1 - Amendments

 

Trade Practices Act 1974

 

Item 1 - Paragraph 87(1A)(b)  

 

5.1   This item would remove the words “(other than section 45D or 45E)” from Paragraph 87(1A)(b) of the Trade Practices Act 1974 (TPA).  The effect of this change would be to enable the Australian Consumer and Competition Commission (ACCC) to seek orders from the Federal Court on behalf of one or more persons who have suffered, or are likely to suffer, loss or damage by conduct of another person where the conduct engaged in is in contravention of sections 45D or 45E.

5.2   This change would remove the current limitation, where the ACCC is able to seek such orders for all of Part IV of the TPA other than sections 45D or 45E

Item 2 - Paragraph 87(1B)(a)

5.3    This item would remove the words “(other than section 45D or 45E)” from Paragraph 87(1B)(a) of the Act, which prescribes the conditions the ACCC must satisfy before they may commence a representative action on behalf of a person or persons who have suffered loss or damage, or likely to suffer loss or damage, as a result of conduct in contravention of the TPA

5.4   This change would allow the ACCC to initiate representative actions in respect of breaches of sections 45D and 45E.  The ACCC may currently initiate such representative actions for all of Part IV of the TPA, other than sections 45D and 45E. 



Part 2 - Application provision

Item 3 - Application

5.5   Item 3 makes it clear that the ACCC may only bring actions for compensation or representative actions for contraventions of Sections 45D and 45E in relation to conduct that occurred on or after the commencement of the amendment

 

 



SCHEDULE 6 - FEDERAL AWARDS

 

6.1          This Schedule proposes amendments to Part VI and Part IX of the Workplace Relations Act 1996 .

 

6.2          Consistent with the proposed amendments to the principal object of the Act (and the objects of Part VI), these amendments are directed towards:

 

·                providing all businesses with more information about their rights and the processes involved with roping-in claims;

 

·                restraining the ability of unions to rope small businesses which employ no union members into the federal jurisdiction; and

 

·                requiring the Commission to inquire into the views of unrepresented small business employers potentially affected by a roping-in claim.

 

 

Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - Subsection 101(1)

 

6.3          This amendment is consequential upon the amendment proposed by item 2.  It would provide, in relation to an alleged industrial dispute notified in the Commission, that the Commission’s powers to determine the parties to the industrial dispute and the matters in dispute and to record its findings are subject to the requirements set out in proposed new sections 101A and 101B.

 

Item 2 - After section 101

 

New section 101A - When Commission must not make findings under section 101

 

6.4          New section 101A would provide that where an alleged industrial dispute has been notified to the Commission on the grounds that a party has not agreed to demands set out in a log of claims, the Commission must not make any findings under section 101 unless it is satisfied that the requirements set out in paragraphs (a) to (d) were met.

 

6.5          Proposed new paragraph (a) would require the log of claims served by the party notifying the alleged industrial dispute to be accompanied by a notice containing prescribed information. 

 

6.6          The purpose of the requirement contained in paragraph (a) is to ensure that the recipients of logs of claims, especially recipients that are unfamiliar with the log of claims process, such as small business or new business operators, are provided with basic information about the process and their rights and obligations at the time the log is served.  The notice is required to state that small business employers (that is, employers who employ less than 20 people on the day the log of claims was served on the employer, including any casual employee who has been engaged on a regular and systematic basis for a sequence of periods of employment of at least 12 months) will be able to identify themselves to the Commission at a later date and if they do not employ a union member, will not be able to be made a party to a dispute finding.  Other relevant information would include, for example, explanations of the processes of the Commission for dealing with logs of claims, the Commission’s powers with respect to matters contained in logs of claims and the rights of parties who have been served with logs.

 

6.7          Proposed new paragraph (b) would require that the alleged industrial dispute was notified under section 99 of the Act at least 28 days after the service of the log.

 

6.8          Proposed new paragraph (c) would require that the party notifying the alleged industrial dispute had, at least 28 days before the day fixed for the initial proceedings in relation to the alleged dispute, served each person alleged to be a party to the dispute with a notice of the time and place fixed for proceedings.

 

6.9          The purpose of the requirements contained in paragraphs (b) and (c) is to ensure that the recipients of logs of claims and notices of proceedings, especially recipients that are unfamiliar with the logs of claims process, such as small business employers, are allowed adequate time to seek advice about their rights and obligations, and to prepare for any relevant proceedings.

 

6.10      Proposed new paragraph (d) would require that the log of claims does not include any demand that:

 

·                requires conduct that would contravene Part XA of the Act;

 

·                a provision be included in an award that the Commission is prevented from including under new subsection 89A(6A), or an objectionable provision within the meaning of new section 170MDB be included in an agreement [these new provisions are proposed by Schedule 8 to this Bill - the effect of this element is that the log of claims may not include demands to restrict the use of contractors that cannot be implemented in awards or agreements];)

 

·                an objectionable provision (within the meaning of section 298Z) be included in an award or agreement; or

 

·                does not pertain to the relationship between employers and employees.

 

6.11      Proposed new paragraph (d) is designed to ensure that where a log of claims is served with a view of notifying the Commission of an alleged industrial dispute in relation to the log, such a log of claims should only include demands in respect of matters that may be included in an award or agreement under the Act.

 

New section 101B - Findings in relation to employers in small business

 

6.12      New section 101B would provide that where an alleged industrial dispute has been notified to the Commission on the grounds that a party has not agreed to demands set out in the log of claims, the Commission must not make any findings under section 101 unless it is satisfied that the requirements set out in subsections (1) to (3) are met.

 

6.13      Proposed new subsection 101B(1) states that it applies where an organisation of employees notifies an alleged industrial dispute on the grounds that one or more employers (notified employers) have not agreed to demands set out in a log of claims served by that organisation on those employers.

 

6.14      The purpose of the requirement contained in subsection 101B(1) is to make clear that it applies where an organisation of employees notifies an alleged industrial dispute.

 

6.15      Proposed new subsection 101B(2) would require that, before making any dispute finding in respect of such an alleged industrial dispute, the Commission give each notified employer a notice in writing requesting that the employer inform the Commission within the time specified in the notice, whether the employer employed less than 20 people on the service day (defined in subsection 101B(5) as the day the log of claims was served on the employer). 

 

6.16      The purpose of the requirement contained in subsection 101B(2) is to give all small business employers an opportunity to identify themselves to the Commission.  The Commission would accept the employer's statement as prima facie evidence that they are a small business employer unless evidence to the contrary was provided.  The notice is intended to contain a warning that providing any false or misleading information to the Commission may result in prosecution under the Criminal Code Act 1995 (Cth).  Where evidence that contradicts the employer’s assertion is provided, the Commission must weigh up whether it accepts that the employer fits the definition of a small business.  The Commission would provide a list of all employers identifying as small businesses to the relevant organisation(s) of employees, in order for the organisation to have an opportunity to satisfy the Commission that the employer was not a small business, or employs a union member. 

 

6.17      Proposed new subsection 101B(3) prevents the Commission from determining that a notified employer is party to any dispute finding in respect of such an alleged industrial dispute unless:

 

§   the Commission is not satisfied that the employer who informed the Commission under subsection 101B(2) was a small business on the service day; or

 

§   the Commission is satisfied that the employer employs a member of the relevant organisation. 

 

6.18      The purpose of the requirement contained in subsection 101B(3) is to ensure that a small business employer who identifies themselves to the Commission and who does not employ a union member is not determined to be a party to a dispute finding in respect of an alleged industrial dispute.  The onus of proof lies with the organisation of employees which would need to satisfy the Commission that the employer was not a small business, or employs a member.  (New section 290A, proposed by item 3 of this Schedule, would allow an organisation of employees to apply to the Industrial Registrar to obtain a certificate that states that a particular small business employer employs a member of the organisation.)

 

6.19      Proposed new subsection 101B(4) would require the Commission, before making an award in relation to such a dispute, to give a notice in writing inviting each party determined to be a party to that dispute, who the Commission is satisfied employed less than 20 people on the service day, to make comments on the proposed award within the period specified in the notice.

 

6.20      The purpose of the requirement contained in subsection 101B(4) is to ensure the Commission provides an opportunity for the views of unrepresented small business employers potentially affected by a roping in claim (ie those businesses employing at least one union member) to be expressed, by a means other than attending a hearing.

 

6.21      Proposed new subsection 101B(5) defines ‘service day’, in relation to a notified employer, as the day on which the log of claims was served on the employer.

 

6.22      Proposed new subsection 101B(6) makes clear that, for the purposes of working out whether a notified employer employed less than 20 people on the service day, a casual employee who had been engaged on a regular and systematic basis for a sequence of periods of employment of at least 12 months should be counted, but not any other casual employee.

 

Item 3 - After section 290

 

New section 290A - Certificate to the effect that an employee is a member of an organisation

 

6.23      New section 290A which would provide that an organisation of employees, for the purposes of section 101B may apply to the Industrial Registrar for a certificate certifying that an employee is a member of that organisation.  The certificate will identify the organisation and the employer and is for all purposes of the Act evidence of what it certifies.

 

6.24      The purpose of the section is to provide a mechanism for an organisation of employees to apply to the Industrial Registrar to prove that a small business employer employs their members.  The certificate will identify the employer and the organisation of employees but will assure employee confidentiality as it will not identify employees. 

 

 

Part 2 - Application provision

 

Item 4 - Application of items 1, 2 and 3

 

6.25      This item proposes that the amendments made by items 1, 2 and 3 of this Schedule, which would restrict the capacity for small business employers to be roped-in to Federal awards, apply to alleged industrial disputes notified after the commencement of this Schedule.

 

 



SCHEDULE 7 - ENTRY AND INSPECTION OF PREMISES BY ORGANISATIONS

 

7.1         This Schedule proposes to introduce new requirements for entry to premises by employees and officials of organisations by amending Division 11A of Part IX of the Workplace Relations Act 1996 (WR Act)

7.2         The proposed amendments build on the current permit system, by introducing a requirement that, as a prerequisite to exercising right of entry to a workplace, a union have a written invitation from an employee who is a member of that organisation. 

7.3         Provision is made to ensure the confidentiality of employees who give invitations.  An employee’s decision to give or refuse to give an invitation is further protected by new prohibitions on certain conduct by employers and organisations.

7.4         The current notice requirements will be extended to 5 working days, and a new requirement will provide that a person exercising right of entry show the employer or occupier a card outlining the rights and obligations of the employer, occupier and the permit holder under the WR Act. 



Part 1 - Amendments

Workplace Relations Act 1996

Item 1 - After subsection 285B(2)

7.5         This item proposes to insert a new subsection 285B(2A).  This subsection would ensure entry under subsection 285B(2) (ie, for inspection purposes) could only occur if the permit holder’s organisation has received an invitation that meets the requirements of proposed new section 285CA. 

Item 2 - Paragraph 285B(3)(a)

7.6          The amendment proposed by this item would ensure that a permit holder may only inspect and make copies of documents that relate to the employment of the members of their organisation. 

Item 3 - Paragraph 285B(3)(c)

7.7         The amendment proposed by this item would ensure that a permit holder, having entered for the purpose of investigating a suspected breach, may only interview employees who are willing to be interviewed, about the suspected breach.

Item 4 - After subsection 285B(3)

7.8         The amendment proposed by this item will prohibit a person from inspecting or making copies of documents referred to in paragraphs 285B(3)(ii) to (iii) that do not relate to the employment of members of the organisation of which the person is an officer or employee.  This is a civil penalty provision.

Item 5 - Subsection 285C(2)

7.9         This item proposes to replace existing subsection 285C(2) with new subsections 285C(2), 285C(2A) and 285C(2B).  [The new subsections are numbered in this way to accommodate amendments to section 285C proposed by the Workplace Relations (Registered Organisations) (Consequential Provisions) Bill 2001.]

7.10           Subsection 285C(2) would ensure that entry under section 285C (ie, for the purpose of discussion with employees) could only occur if the permit holder’s organisation has an invitation as required by proposed new section 285CA.

7.11           Proposed subsection 285C(2A) would require that permit holders are only to enter premises during working hours and that discussions between employees and permit holders can only occur during employees’ meal time or other breaks.  (This replicates existing subsection 285C(2).)

7.12           Proposed subsection 285C(2B) provides that an organisation can only enter a particular premises for discussion purposes once every 6 months.  It is not intended to restrict an organisation from accessing other premises of the same employer in the 6 month period. 

Item 6 - After section 285C

7.13           This item relates to the new invitation requirement.

New section 285CA - Requirements of employee invitation to enter premises

7.14           New section 285CA sets out the requirements for a valid invitation to enter premises.  Those requirements are as follows:

·         the invitation must be in writing and signed by at least one employee who works at the premises and is a member of the organisation to which it is issued;

·         the invitation must be given to the organisation or to an officer or employee of the organisation; and

·         the invitation must be current.

7.15           A ‘current invitation’ is one that has been given within 3 months of the proposed entry, or has been certified under proposed section 291B within 3 months of the proposed entry [proposed section 291B is described in the notes on item 10 of this Schedule].

New section 285CB - Protection of inviting employee’s identity

7.16           New section 285CB  (together with proposed new section 291B) would provide for the protection of the identity of an employee who has given an invitation.

7.17           An invitation may state that the identity of the inviting employee or employees is confidential [proposed subsection 285CB(1)].

7.18           New subsection 285CB(2) would require the organisation receiving the invitation to ask the employee or employees who have signed the invitation if they wish their identity to be confidential if there is no statement as to confidentiality in the invitation.  This is a civil penalty provision.

7.19           If an employee has indicated a preference for confidentiality, the organisation must not reveal the employee’s identity to the employee’s employer or the occupier of the premises to which the invitation relates [proposed subsection 285CB(3)].  This subsection is a civil penalty provision.

Item 7 - Section 285D

7.20           Current section 285D requires a permit holder to comply with certain requirements in exercising the right of entry conferred by sections 285B and 285C.  Section 285D would be repealed, and new sections 285D, 285DA, 285DB and 285DC - which extend these requirements - would be inserted.

New section 285D - Obligations on entering premises

7.21           Proposed subsection 285D(1) would require a permit holder to comply with a request to see the invitation or permit relating to the proposed entry by the employer of the employees who issued the invitation (known as the ‘relevant employer’) or the occupier.  If the permit holder does not comply with such a request he or she cannot not enter or remain on the premises.  This subsection is a civil penalty provision.

7.22           Under proposed subsection 285D(2), a permit holder requested to show the invitation would be able to comply with the request by showing the employer and occupier a copy of the invitation or a confidentiality certificate issued under section 291B [on which see item 10 of this Schedule].  Proposed subsection 285D(3) provides that this would not limit the ways in which a request may be complied with.

7.23           New subsection 285DA(4) is a civil penalty provision which would require the permit holder to take all reasonable steps to provide the relevant employer or occupier with a card containing specific information about the rights and obligations of the employer, occupier and permit holder (see proposed section 285DC and schedule 9), immediately upon entering the premises.

7.24           Proposed subsection 285D(5) would define, for the purpose of section 285D, the term ‘relevant employer’ as the employer of the employee or employees who issued the invitation.

New section 285DA - Notification of entry to premises

7.25           New section 285DA specifies requirements in relation to notice of entry to premises. 

7.26           Subsection 285DA(1) is a civil penalty provision and would require the permit holder to give both the relevant employer and the occupier of the premises (each known as a ‘notified party’) at least 5 working days written notice of the intended entry.  This notice must:

·         specify the day on which entry is proposed (the ‘nominated day’);

·         specify whether entry to the premises is proposed under section 285B or 285C (ie whether inspection is for the purposes of inspection or discussion with employees); and

·         contain the information set out in Schedule 9 to the Act [to be inserted by Item 11 of this Schedule].

7.27           A legislative note advises that the information must contain phone numbers for the Office of the Employment Advocate, as per proposed paragraph 285DC(1)(b).

7.28           Proposed subsection 285DA(2) would allow a notified party to give the person seeking entry a notice in writing specifying an alternative day on which the person may enter the premises.  This notice must be given at least one day before the ‘nominated day’ and must propose a day no more than 5 working days after the nominated day. 

7.29           Subsection 285DA(3) would provide that the notified parties must provide to one another a copy of any notice they give to the person seeking entry.  Subsection 285DA(4) provides that if an alternative day has been proposed, the permit holder may only enter on that day, and subsection 285DA(5) provides that if both notified parties give a notice which specify alternative days, then the person seeking entry may only enter the premises on the later of those days.

7.30           Proposed subsection 285DA(6) would define the term ‘relevant employer’ for the purpose of section 285DA.

New section 285DB - Premises used for residential purposes

7.31           New section 285DB would replicate subsection 285D(3) of the WR Act (which will be omitted because of the amendments proposed by this item - see above). 

New section 285DC - Entry cards

7.32           This section would deal with the new requirement for entry cards. 

7.33           Subsection 285DC(1) would provide for the preparation and issue to permit holders of cards containing information set out in Schedule 9 (information relating to entry to premises) by the Industrial Registrar.  This subsection would also require that the cards contain phone numbers of the Office of the Employment Advocate.

7.34           These cards are to be in a form considered appropriate by the Industrial Registrar (proposed subsection 285DC(2)).

Item 8 - After section 285E

7.35           This item would insert new sections 285EA and 285EB to prohibit conduct by employers and organisations relating to an invitation to enter premises.

New section 285EA - Prohibited conduct - employers

7.36           New subsection 285EA(1) (which is a civil penalty provision) prohibits specified conduct by an employer, where engaged in for a prohibited reason or reasons including a prohibited reason:

·         dismiss an employee;

·         injure an employee in his or her employment;

·         alter the position of the employee to the employee’s prejudice; or

·         discriminate against an employee.

7.37           Threats to engage in such conduct are also prohibited.

7.38           New subsection 285EA(2) specifies as a prohibited reason for engaging in conduct of the type listed in subsection 285EA(1) the fact that an employee gives or proposes to give an invitation to enter premises.

New section 285EB - Prohibited conduct - organisations

7.39           This section prohibits certain conduct by organisations, or officers or members of organisations. 

7.40           Subsection 285EB(1) prohibits taking, or threatening to take, industrial action where the aim (or one of the aims) is to coerce a person to breach proposed section 285EA. 

7.41           New subsections 285EB(2) and (3) prohibit the following conduct, if done for a ‘prohibited reason’ (or reasons which include a prohibited reason) - as defined in subsection 285EB(4):

·         taking or threatening to take any action whose aim, or one of whose aims, is to prejudice a person in the person’s employment;

·         imposing, or threatening to impose, a penalty, forfeiture or disability of any kind on a person who is a member of the organisation.

7.42           Proposed subsection (4) defines ‘prohibited reason’ for the purposes of section 285EB.  Conduct against a person is engaged in for a ‘prohibited reason’ if the conduct was engaged in because the person has refused to give an invitation to enter premises under sections 285B or 285C or because a person has given such an invitation to another organisation.

7.43           Subsection 285EB(5) would prohibit an organisation, or an officer or member of an organisation, from making a right of entry invitation a condition of membership. 

7.44           Subsection 285EB(6) would provide that an organisation or an officer or member of an organisation must not harass a member of an organisation to give an invitation to enter premises.  The word ‘harass’ in this subsection is to have its ordinary meaning.

7.45           Each of subsections (1), (2), (3), (5) and (6) are civil penalty provisions.

Item 9 - Subsection 285F(1) (definition of penalty provision )

7.46           This item proposes to repeal the existing definition of ‘penalty provision’ and substitute a new definition.  The new definition reflects the fact that additional conduct is subject to civil penalty as a result of the amendments proposed by this Schedule. 

Item 10 - After section 291A

New section 291B - Certificate as to invitation to enter premises

 

7.47           Item 10 would insert new section 291B.  This section would provide for a certificate to be issued to the effect that an invitation that meets the requirements of the WR Act has been given to an organisation.  This is designed to ensure that the identity of inviting employees need not be revealed. 

7.48           A Registrar would be required to issue a certificate to an organisation which has an invitation to enter specified premises which has given to the organisation no earlier than 3 months before the application was made, and which meets the requirements of section 285CA [proposed subsection 291B(1)].  An invitation would be taken to have been given to the organisation if it was given to one of the organisations’ officers or employees - proposed subsection 291B(2).

7.49           Proposed subsection 291B(3) would provide a certificate could not identify the inviting employee.  It would, however, be required to identify the organisation to whom the invitation was given, the premises to which the invitation relates and the employer and occupier of the premises.

7.50           A certificate would be taken to be sufficient evidence that the invitation was given and meets the requirements of section 285CA (proposed subsection 291B(4)).

Item 11 - Before Schedule 10

New Schedule 9 - Information relating to entry to premises under section 285B or 285C

 

7.51           This item would insert a new Schedule 9 to the WR Act, which would set out the text to be included in written notification to employers and occupiers of intention to enter premises and on entry cards.  The information on these cards would include:

·         the rights of union officials to enter workplaces under federal law;

·         the purposes for which union officials can enter business premises;

·         the obligations of union officials entering business premises;

·         the rights of employers and occupiers, including the right to specify an alternative day for right of entry;

·         the rights and obligations of union officials in investigating a suspected breach; and

·         the obligations of employers and occupiers in relation to union officials exercising right of entry and inspection of documents. 



Part 2 - Application and transitional provisions

7.52           Part 2 contains specific application and transitional provisions relating to the amendments in Part 1.

Item 12 - Application and transitional provision

7.53           This item provides that, subject to the exceptions below, the amendments made by all items in Part 1 (except item 8) apply on and after the commencing day (that is, the day on which the amendments proposed in Part 1 of this Schedule come into effect).

7.54           Certain requirements of the new scheme being established by the amendments would not apply until 14 days after the commencing day.

·         The new requirement for an invitation would not apply to an entry to premises within 14 days of the commencing day.  Notice given before the commencing day under current subsection 285D(2) of the WR Act would continue in relation to any entry to the premises within 14 days of the commencing day. 

·         An entry made within 14 days of the commencing day for which a notice was given under subsection 285D(2) would also be disregarded for the purposes of new subsection 285C(2B) (which limits entry for discussion purposes to once each 6 months). 

·         New subsection 285D(1)(b), insofar as it requires a person to comply with a requirement to show an occupier or employer the person’s invitation to enter premises, would not apply to a person within 14 days after commencement.

·         Proposed subsection 285DA(5) would not apply within 14 days of commencement.

7.55           In addition, the amendment made to paragraph 285B(3)(a) (which limits access to documents to documents relevant to the employment of members - item 2 of Part 1) is not to apply to a notice given before the commencing day under current subsection 285D(2) of the WR Act. 

Item 13 - Application of  item 8

7.56           This item provides that the amendments made by item 8, which would insert new sections 285EA and 285EB, only apply in relation to conduct engaged in on or after the commencement of that item.



SCHEDULE 8 - CONTRACTS FOR SERVICES

 

8.1         This Schedule proposes to amend the Workplace Relations Act 1996 (WR Act) to prevent awards and certified agreements from restricting the use of contractors.  The Australian Industrial Relations Commission will not have the power to include such clauses in awards, and existing clauses will be removed, with an exception for the textiles, clothing and footwear industry.  The Commission will not be able to certify agreements which it was satisfied contained such clauses, any such clause in an agreement will become void, and such clauses will be able to be removed from agreements.

 

 

Part 1 - Amendments

 

Workplace Relations Act 1996

 

Item 1 - After paragraph 45(1)(eaa)

Item 2 - After paragraph 45(3)(ba)

 

8.2           These items are consequential upon item 7, which proposes that the Commission have the power to vary a certified agreement so as to remove a provision restricting the use of contractors.  The first amendment adds to the list of decisions against which appeals may be made to a Full Bench of the Commission, a decision to vary or not vary a certified agreement in this way.  The second amendment identifies the classes of persons who can lodge such an appeal; these are the same as the classes of persons who can apply to the Commission for the removal of such a provision. 

 

Item 3 - After subsection 89A(6)

 

8.3                   Section 89A(2) of the WR Act sets out a number of allowable award matters.  These matters may be the subject of an industrial dispute, and are the only matters about which the Australian Industrial Relations Commission (Commission) may make awards.  Subsection 89A(6) allows provides that the Commission may include in an award matters that are incidental to the matters set out in subsection (2) and necessary for the effective operation of the award.  This item proposes to introduce two new subsections in section 89A. 

 

8.4                   Subsection 89A(6A) would limit the Commission’s power under subsections 89A(2) and (6) to ensure that awards do not contain provisions that restrict employers from:

 

·         entering into contracts for services; or

 

·         including particular terms or conditions in contracts for services.

 

8.5                   This provision is intended to ensure that awards do not contain provisions that restrict employers in relation to the use of independent contractors, labour hire firms or other non-employee labour.

 

8.6                   Subsection 89A(6B) is an exception to subsection 89A(6A), which will apply in relation to awards for the textiles, clothing and footwear industry.  This is a limited exception that will allow certain award provisions to continue to operate in that industry.  Acceptable award provisions are those that restrain an employer from entering into contracts for services unless those contracts provide that the work concerned is to be performed on terms and conditions that are at least as favourable as those that would otherwise apply under the award in relation to that work.  An explanation of the particular circumstances of the textiles, clothing and footwear industry, which make this exception necessary, is provided in the regulation impact statement for this Schedule, in this Explanatory Memorandum.

 

8.7                   New subsection 89A(6C) provides a definition of ‘TCF award’ for the purposes of subsection 89A(6B).  A TCF award means an award regulating employment in the textiles, clothing and footwear industry.

 

Item 4 - After subsection 170LU(2A)

 

8.8                   This item proposes a new criterion in certifying agreements.  The Commission will be unable to certify an agreement, if satisfied that it contains provisions restricting entry into contracts for services.  Such provisions will be rendered void by new section 170LZA, proposed by the following item.  However, it is preferable for agreements containing ostensible provisions of this type not to be certified. 

 

8.9                   The new subsection parallels existing subsection 170LU(2A), which prevents certification of agreements containing ‘objectionable provisions’, within the meaning of Part XA of the Act.

 

Item 5 - At the end of Division 5 of Part VIB

 

New section 170LZA - Provisions of certified agreements restricting employers from entering into contracts for services

 

8.10               This new section renders void existing or future clauses in certified agreements which purport to restrict employers in the use of contractors.  This section parallels existing section 298Z, which renders void provisions in industrial instruments which purport to authorise or require conduct contrary to Part XA of the Act.

 

Item 6 - After paragraph 170MD(7)(c)

 

8.11           Section 170MD deals with the process for varying certified agreements made under Part VIB of the WR Act.  Under subsection 170MD(7), a certified agreement is not to be varied except in accordance with a number of specified provisions.

 

8.12           This item would include a new paragraph in subsection 170MD(7) which will refer to new section 170MDB proposed to be added by the following item.

 

Item 7 - After section 170MDA

 

8.13               This item proposes to include a new section in Part VIB of the WR Act.

 

New section 170MDB - Removal of provisions relating to the entry into contracts for services from certified agreements

 

8.14               This new section provides for removal from certified agreements of provisions restricting the use of contractors, on application.  Applications will be able to be made by:

 

·         a person bound by the agreement;

 

·         an employee whose employment is subject to the agreement;

 

·         a person who wishes to enter into a contract for services with an employer bound by the agreement; or

 

·         the Minister.

 

 

Part 2 - Application and transitional provisions

 

8.15           Part 2 contains the application and transitional provisions for the amendments contained in Part 1 of the Schedule.

 

Item 8 - Application of items 1, 2, 4, 5, 6 and 7

 

8.16           The proposed item would ensure that the amendments made by Part 1 would apply in relation to all certified agreements, whether certified before or after commencement of this Schedule.

 

Item 9 - Application of item 3

 

8.17           The proposed item would ensure that the amendments made by Part 1 would apply (after commencement) to industrial disputes, whether or not the Commission had been dealing with those disputes before the commencement of Part 1.

 

Item 10 - Transitional provision - review of certain awards

 

8.18           These provisions provide a process for the consideration and removal of clauses in awards that will no longer be allowable after the commencement of Part 1.

 

8.19           Within 12 months after the commencement of this Schedule, the Commission is to review all awards that contain clauses that restrict use of contractors, other than clauses within the exception for the textiles, clothing and footwear industry.

 

8.20           After considering appropriate alternatives, the Commission may vary the awards to remove the provisions.  If the Commission does not remove the clauses they will cease to have effect at the end of twelve months after the commencement of the Schedule.  Any provisions that cease to have effect may be removed by the Commission.

 

 




[1]     Evidence, Mr Grant Poulton, 29 January 1999, EWRSBE 6

[2]     Evidence, Mrs Leyla Yilmaz, 7 October 1999, EWRSBE 187.

 

[3]     The Employment Advocate is required to issue a filing receipt when certain procedural requirements are met - see subsection 170VN(2).  The issuing of a filing receipt does not amount to approval of an AWA - assessment of an AWA for compliance with the statutory approval requirements is a separate (and later) process. 

[4]      This data does not relate exclusively to workplaces in the federal jurisdiction.

[5]      Based on private sector data for Australian workplaces from the 1995 Business Longitudinal Survey.

[6]      Based on employee numbers from ABS Wage and Salary Earners (Cat.  No.  6248.0), March Quarter 2001.

[7]      ABS Employee Earnings, Benefits and Trade Union Membership (Cat.  no.  6310.0), August 2000. 

[8]     Senate Economic References Committee, Parliament of the Commonwealth of Australia, Outworkers in the Garment Industry , Senate Printing Unit, Parliament House, Canberra, December 1996, pp.  xiii, 13-16.