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Workplace Relations Amendment (Transmission of Business) Bill 2004

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2002

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

WORKPLACE RELATIONS AMENDMENT

(TRANSMISSION OF BUSINESS) BILL 2002

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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

and Small Business , the Honourable Tony Abbott MP)



 



 

 

WORKPLACE RELATIONS AMENDMENT

  (TRANSMISSION OF BUSINESS) BILL 1999 2002

 

 

OUTLINE

 

This Bill will amend the Workplace Relations Act 1996 (the WR Act) to empower the Australian Industrial Relations Commission (the Commission) to make an order that a certified agreement does not bind an employer as a result of a transmission of business, or only binds the employer to a specified extent or for a specified period .

 

When a transmission of business occurs, the new operator of the business is bound by the awards and agreements that bound the former operator of that business .  Under section 149 of the WR Act, the Commission has the power to order that the new operator of the business is not bound by an award that bound the former operator of the business .  The Commission has exercised this power on several occasions .  However, no similar provision applies in relation to certified agreements.

 

Submissions  made in response to the Ministerial Discussion Paper Transmission of Business and Workplace Relations Issues ,  that was issued in September 2000 by the then Minister for Employment, Workplace Relations and Small Business, the Hon Peter Reith MP, emphasised the difficulties that arise where an employer becomes bound by multiple certified agreements as a result of transmission of business.

 

FINANCIAL IMPACT STATEMENT

 

The measures in this Bill re will have be no significant impact on Commonwealth expenditure.



 

 

REGULATION IMPACT STATEMENT

 

Policy development and consultation

 

The amendments proposed by the Bill are based on amendments initially proposed in the Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999, and later included in the Workplace Relations Amendment (Transmission of Business) Bill 2001.

 

In September 2000, the then Minister for Employment, Workplace Relations and Small Business, the Hon Peter Reith MP, issued a Discussion Paper entitled Transmission of Business and Workplace Relations Issues .  That Discussion Paper noted that a possible option for reforming provisions of the Workplace Relations Act 1996 (WR Act) that regulate the transmission of certified agreements would be to amend the WR Act in terms proposed by this Bill:

 

“…Parliament could re-establish the test originally contained in the IR Act, by which the transmission of certified agreements occurred ‘subject to any order of the Commission’. Under the IR Act, the definition of an award included a certified agreement.  Accordingly, the opening words of s149 applied equally to awards and certified agreements.  This option has the advantage of involving minimal redrafting, and giving transmittee employers an option to alter the application of, or the provisions in transmitted certified agreements.” (page 33).

 

Twenty one submissions were received in response to the Ministerial Discussion Paper, from twelve employer organisations, four employers (including two labour hire firms), the Australian Council of Trade Unions (ACTU), one union, the Queensland and Western Australian Governments, and the federal Joint House Department.

 

Analysis of the Bill

 

Background

 

Section 170MB of the WR Act currently provides that, subject to constitutional limits, where an employer is bound by a certified agreement and a new employer becomes the successor, assignee or transmittee of the first employer’s business (or part of the business), the new employer is bound by the certified agreement to the extent that it relates to the whole or the part of the business.

 

As at 30 September 2001, there were 11,755 current federal certified agreements, covering an estimated 1,362,100 employees.

 

Problem identification and specification of regulatory objectives

 

Several submissions made in response to the Discussion Paper highlighted difficulties that can arise from the interaction of existing and transmitted certified agreements following a transmission of business.

 

As a result of the operation of section 170MB, a transmittee employer can find itself bound by two or more different agreements in relation to the same group of employees.

 

A transmitted certified agreement will apply to the transmitted business, subject to the priority system established by the WR Act regarding the interrelationship of certified agreements.    Section 170LY provides that a certified agreement has no effect to the extent of any inconsistency with another agreement certified before it, whose nominal expiry date has not passed. 

 

The effect of this provision is that an employer acquiring a business may have to apply a certified agreement that transmits with the business over an agreement that it negotiated with its employees before the transmission.  The employer has no control over which agreement takes priority - this is simply determined by the respective certification dates of the agreements.

 

Further, the employer may not simply be able to negotiate a new, replacement certified agreement that is appropriate to the needs of the transmittee’s business.  A new agreement cannot have effect unless the agreement is made after the expiry date of existing and transmitted agreements, or existing agreements are terminated (which requires agreement of all parties as well as approval by a valid majority of all employees whose employment is subject to the agreements being terminated - which could include employees in other businesses).

 

The fact that certified agreements are generally negotiated on an enterprise basis and are therefore specific to the needs of that enterprise can mean that a transmitted certified agreement may not be appropriate to the new employer’s business.  A number of difficulties that employers have reported to the Government, affecting the administration of their businesses, include:

 

·          a transmitted agreement may contain impediments to productivity and efficiency which adversely affect the ongoing viability and profitability of the transmittee’s business;

 

·          the provisions in the transmitted agreement may be irrelevant to the business operations of the transmittee, and/or prevent or hinder the transmittee from implementing appropriate workplace arrangements;

 

·          there may be practical difficulties involved in applying transmitted agreements (e.g. the certified agreement may incorporate or refer to policies and procedures that the transmittee does not have access to and there may be differences in job and work design and organisation);

 

·          following a consolidation of the two businesses at the same site, employees working side by side at the same job may have different entitlements under their respective agreements.  This anomaly can arise as a transmitted certified agreement only applies to the extent that it relates to the whole or the part of the business that has been transmitted; and

 

·          there can be practical difficulties in attempting to vary or terminate a certified agreement.  A variation or termination of an agreement requires the agreement of all parties as well as approval by a valid majority of employees whose employment is subject to the agreement.  This agreement and approval can be difficult to organise, especially in cases where, as a result of transmission of business, a certified agreement s binds a of number of employers with employees whose employment is subject to the agreement; and

 

·          the above difficulties can act as a disincentive to the transmission of business and the risk of these difficulties can act as a disincentive to the development of business and cause interruption to business projects.

 

The Commission does not have a power to make orders addressing the interaction of certified agreements, as it does in relation to awards.

The desired objective is to provide the Commission with the power to address problems that might arise from the inappropriate interaction of industrial instruments, by ordering that a transmittee employer is not bound, or is bound only to a specified extent, by a certified agreement, while maintaining the integrity of the agreement-making process (e.g. by not allowing avoidance of obligations through changed business arrangements). 

 

Options

 

Option 1: Status Quo

 

Option 2: Amend the WR Act

 

Amend the WR Act to allow the Commission to make orders that a transmittee employer is not bound by a transmitting certified agreement, or is only bound to the extent ordered by the Commission. 

 

To ensure that this mechanism is not used to avoid obligations under a certified agreement, it is proposed that the Commission give interested persons (including employers, employees and representatives of employees) an opportunity to make submissions.  The Commission would need to take account of these submissions in making a judgment as to whether, or to what extent, a transmitting certified agreement should bind the new employer.

 

Parties Views

 

Submissions in response to the Discussion Paper highlighted difficulties for businesses that can arise from the interaction of existing and transmitted certified agreements following a transmission of business.

 

The ACTU is concerned to ensure that employees should retain negotiated benefits when the ownership of the business or part of the business changes.

 

Impact Analysis

 

This Bill will impact on employers, employees and their representatives and the Commission.

 

Option 1: Status Quo

 

Costs

 

Submissions received in response to the Ministerial Discussion Paper have stated that the consequences of a transmission of business in relation to certified agreements cause significant problems.

 

The problems identified above cause complications for the administration of businesses and the determination of pay and conditions of employment for employers and employees.

 

This is especially a problem in situations where labour hire employers provide s services to a number of other businesses which each have their own certified agreements in place.  There is a risk that contracting labour hire or other service providers will amount to a transmission of business and that the labour hire employer could become bound by several different certified agreements.

Without legislative amendment, these problems will continue, and the provisions of the WR Act regulating transmission of certified agreements will act as a disincentive to the transmission of business and the development of business, and interrupt the efficient management of business projects.

 

Benefits

 

Maintaining the status quo will ensure that the pay and conditions of employees who continue to be employed in a business following the transmission of the business to a new employer cannot be altered until after the nominal expiry date of their certified agreement.

 

Option 2: Amend the WR Act

 

Costs

 

There will be a small additional caseload for the Commission.  This increase is not expected to be significant when compared with the Commission’s current caseload.

 

There is a possibility that in some cases, where transmitting certified agreements are not appropriate to the business arrangements of the new employer, the pay and conditions of employees who transmit with a business may be affected by an order of the Commission.

 

Benefits

 

This option has the advantage of allowing the Commission to address difficulties associated with the interaction of certified agreements, and so avoid or reduce the difficulties identified above.  This is consistent with retaining the enterprise focus of agreements.

 

The option also protects the interests of employees by allowing them or their representatives to make submissions to the Commission before an order is made.  It would then be a matter for an independent body (the Commission) to consider the application and take account of the submissions of the parties when deciding whether to make an order, and the form of any such order.

 

An example of how the Commission has exercised its jurisdiction to make an order that an award (rather than a certified agreement) does not bind a transmittee employer is the EDS (Australia) Pty Ltd case decided in November 2000.  In that case the Commission took account of submissions from the relevant parties and ordered that EDS (Australia) Pty Ltd, which provides outsourced information technology and related services to a number of businesses, was not bound, as a result of a transmission of business, by 68 awards that bound one or more of those businesses.  The Commission considered that the making of the order did not disadvantage the employees.

 

Conclusion and Recommended Option

 

Option 2 is recommended over the status quo because it:

 

·          provides greater flexibility in the agreement-making process following a transmission of business;

·          provides appropriate safeguards for the parties, for example, through the requirement for certain parties to be allowed to make submissions prior to an order being made; and

 

·          addresses some of the practical problems that have arisen in connection with the operation of the current legislation.

 

Implementation and Review

 

The proposed reform measure is to be given effect by amendments to the WR Act.  The Department of Employment and Workplace Relations will monitor the impact of the legislation.

 

The legislation will also be reviewed through formal mechanisms for consultation already in place.  In particular, the National Labour Consultative Council will have an ongoing role in monitoring the legislation and any issues that may arise.

 

Consultation with interested parties and groups will continue .



[Please insert amended RIS here] Policy development and consultation

 

The amendments proposed by the Bill generally reflect changes initially proposed in the Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999 and again proposed in the Workplace Relations Amendment (Transmission of Business) Bill 2001 .   The major difference s between this Bill and those earlier Bills relate to the parties that w ill be able to make applications and submission s in relation to orders relating to transmission of certified agreements.

 

In September 2000, the then Minister for Employment, Workplace Relations and Small Business, the Hon Peter Reith MP, issued a Discussion Paper entitled Transmission of Business and Workplace Relations Issues .  That Discussion Paper noted that a possible option for reform was an amendment of the WR Act to give the Commission the power to exempt an employer from being bound by a certified agreement as a result of a transmission of business or to modify the circumstances in which the employer is bound (as is proposed in this Bill).

 

Several submissions in response to the Discussion Paper highlighted difficulties that can arise from the interaction of existing and transmitted certified agreements following a transmission of business.

 

Analysis of the Bill

 

Background

 

Section 170MB of the WR Act currently provides that, subject to constitutional limits, where an employer is bound by a certified agreement and a new employer becomes the successor, assignee or transmittee of the business or part of the business concerned, the new employer is bound by the certified agreement to the extent that it relates to the whole or the part of the business.

 

Problem identification and specification of regulatory objectives

 

An employer can find itself bound by two or more different agreements (its own agreement and other agreements that transmit to it as a successor, assignee or transmittee of another employers business) in relation to the same group of employees.

 

Inconsistencies between multiple agreements binding an employer are resolved by the priority system established by the WR Act (i.e. that a certified agreement has no effect to the extent of any inconsistency with another agreement certified before it, whose nominal expiry date has not passed: section 170LY).  The effect of this is that the transmittee employer may have to apply a transmitted certified agreement over its own agreement based on an event outside its control (the earlier certification date of the transmitted agreement).

 

The priority rule in the WR Act also imposes limitations on the ability of the parties to negotiate a new certified agreement which is appropriate for the needs of the transmittee’s business, as any such agreement could not have effect unless certified after the expiry of earlier (pre-existing and transmitted) agreements, or existing agreements are terminated (which requires agreement of all parties as well as approval by a valid majority of employees whose employment is subject to the agreement).

 

The fact that certified agreements are generally negotiated on an enterprise basis and are therefore specific to the needs of that enterprise can mean that a transmitted certified agreement may not be appropriate to a new employer s business.  A number of difficulties that employers have reported to the Government that affect the administration of their businesses include that:

 

· a transmitted agreement may contain impediments to productivity and efficiency which adversely affect the ongoing viability and profitability of the transmittee’s business;

 

· the provisions in the transmitted agreement may be irrelevant to the business operations of the transmittee, and/or prevent or hinder the transmittee from implementing appropriate workplace arrangements;

 

· there may be practical difficulties involved in applying transmitted agreements (e.g. the certified agreement may incorporate or refer to policies and procedures that the transmittee does not have access to and there may be differences in job and work design and organisation);

 

· following a consolidation of the two businesses at the same site, employees working side by side at the same job may have different entitlements under their respective agreements

 

-           this anomaly can arise as a transmitted certified agreement only applies to the extent that it relates to the whole or the part of the business that has been transmitted; and

 

· there can be practical difficulties in attempting to vary or terminate a certified agreement (as this requires the agreement of all parties as well as approval by a valid majority of employees whose employment is subject to the agreement, which can be difficult to organise, especially in cases where, as a result of transmission of business, a certified agreements binds of number of employers with employees whose employment is subject to the agreement).

 

These difficulties can act as a disincentive to the transmission of business and the risk of these difficulties can act as a disincentive to the development of business and cause interruption to business projects.

 

As at 30 September 2001 31 December 2000 , there were 11,755 certified agreements in operation under the WR Act, covering around 1 , 36 0 , 0 00 employees there was 10,183 certified agreements in operation under the WR Act covering around 1,400,000 employees .

 

The Commission does not have a power to make orders addressing the interaction of certified agreements, a lthough it has such a power s it does in relation to awards.

 

The desired objective is to reduce the cost to business of managing certified agreements when there is a transmission of business.  The proposed amendment will provide an additional low cost and more flexible mechanism by which businesses can manage this issue by providing the Commission with the power to address problems that might arise from the interaction of industrial instruments in appropriate cases by ordering that a transmittee employer is not bound, or is bound only to a specified extent, by a certified agreement, while maintaining the integrity of the agreement-making process (e.g. by not allowing avoidance of obligations through changed business arrangements).  The amendments require the Commission to give all those bound by the agreement specified employers, employees and organisations an opportunity to make submissions before making a decision as to whether, or to what extent, the certified agreement should bind the new employer (provided that, in the case of a union that is bound by an agreement made directly with employees, the union may only make submissions where an employee who they are entitled to represent requests that they do so) .

 

Options

 

Option 1: Status Quo

 

Option 2: Amend the WR Act

 

Amend the WR Act to allow the Commission to make orders that exempt a transmittee employer from being bound by a certified agreement, as it can with awards (in appropriate cases).  To ensure that this mechanism is not used to avoid obligations under a certified agreement, it is proposed that the Commission give appropriate persons bound by , or to be bound by, the certified agreement an opportunity to make submissions before making such an order.

 

Parties’ Views

 

Submissions in response to the Discussion Paper highlighted difficulties that can arise from the interaction of existing and transmitted certified agreements following a transmission of business.

 

The ACTU is concerned to ensure that employees should retain benefits when the ownership of the business or part of the business changes.

 

Impact Analysis

 

This Bill will impact on employers, employees and their representatives and the Commission.

 

Option 1: Status Quo

 

Costs

 

Submissions received in response to the Ministerial Discussion Paper have argued that the consequences of a transmission of business in relation to certified agreements cause significant problems, including complication for the administration of businesses and the determination of pay and conditions of employment for employers and employees.

 

Benefits

 

The status quo ensures that the effect of agreements can only be modified by agreement of the parties.

 

Option 2: Amend the WR Act

 

Costs

 

There will be a small additional caseload for the Commission.  This increase is not expected to be significant in the context of the Commission’s overall caseload.

 

Benefits

 

This option will provide a lower cost and more flexible additional mechanism for the management of certified agreements when there is a transmission of business, especially when multiple employers are bound by the same certified agreement.  This has the advantage of allowing difficulties with the interaction of certified agreements to be addressed, and so avoid or reduce the difficulties identified above that would otherwise result.  This is consistent with retaining the enterprise focus of agreements.

 

It also ensures that the interests of employees appropriate parties are protected by allowing them or their representatives to make submissions to the Commission before an order is made.  It would then be a matter for an independent body (the Commission) to consider the application and take account of the submissions of the parties when deciding whether to make an order, and the form of any such order.

 

An example of how the Commission has exercised its jurisdiction to make an order that an award does not bind a transmittee employer is the EDS (Australia) Pty Ltd case decided in November 2000.  In that case the Commission took account of submissions from the relevant parties and ordered that EDS (Australia) Pty Ltd, which provides information technology and related services to a number of businesses, was not bound by 49 awards (binding on those to whom it provided services) that were potentially applicable.

 

Conclusion and Recommended Option

 

Option 2 is recommended over the status quo because it:

 

· provides greater flexibility in the agreement making process following a transmission of business;

 

· provides appropriate safeguards for the parties, for example, through the requirement for certain parties to be allowed to make submissions prior to an order being made;

 

· addresses some the practical problems that have arisen in connection with the operation of the current legislation.

 

Implementation and Review

 

The proposed reform measure is to be given effect by amendments to existing legislation.

 



NOTES ON CLAUSES

 

Clause 1 - Short title

 

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

 

Clause 2 - Commencement

 

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

 

3.         Clauses 1 to 3 will commence on Royal Assent. 

 

4.         Schedule 1 will commence on a single day to be fixed by Proclamation.   However, if the Schedule ha s not commenced within six 6 months after Royal Assent, subsection 2(3) has the effect that the Schedules will commence on the first day following that six-month six month pe pe riod. 

 

2.         This clause specifies when the various provisions of the Act are proposed to commence. Subclause 2(1) provides that the Act commences on a day to be fixed by proclamation.

 

3. Subclause 2(2) has the effect that if the Act is not proclaimed to commence within six months of the Act receiving Royal Assent, it will commence on the day following that period of six months.

 

Clause 3 - - Schedule ( s )

 

5 4 .       This clause provides that an Act that is specified in a Schedule is amended or repealed as set out in that Schedule, and any other item in a Schedule operates according to its terms.

 



SCHEDULE 1 - TRANSMISSION OF BUSINESS

 

1.1         This Schedule proposes amendments to the provisions of the WR Act , in particular those provisions  that govern ing the application of certified agreements following a transmission of business.

 

Workplace Relations Act 1996

 

Item 1 - Paragraph 45(3)(a)

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

 

1.2         These items would amend sub section 45 (3) of the WR A ct, which sets out who can appeal Commission decisions to a F ull Bench of the Commission.   An organisation or person who participates in proceedings about whether the Commission should make an order that a certified agreement does not apply following a transmission of business, or should only apply to a limited extent or for a limited period , would be a ble to appeal against an order that was subsequently made by the Commission.   If the Commission subsequently refused to make such an order, the organisation or person who applied for the order could appeal against the decision not to make an order . provide for participants in transmission of business proceedings before the Commission to appeal against an order that was made , or a refusal to make an order , by the Commission .

 

Item 3 - Paragraph 45(3)(ba)

 

1.3         Item 3 would makes correct s a n existing drafting clerical error in the WR Act in the Act .

 

Item 4 - At the end of subsection 45(3)

 

1.4         This item would insert a note after section 45, to draw attention to the fact  notes that the new provisions to be inserted by Item 2 (above) would also appeal rights also operate to give the same appeal rights rights to appeal a decision to make an order about the transmission of a certified agreement, or a refusal to make an order about the transmission of a certified agreement, where a business transmits to a Victorian employer.   New subsection 494(3) (see item 11 below) would e xtend the operation of propos ed sub section 170MBA flow from orders made or refused by the Commission following an application made b y a n employer in Victoria or a Victorian employee (within the meaning of Part XV) . (2) in Victoria.

 

Item 5 1 - Paragraph 170 LX MB ( 4 1 )( b d )

 

1.5         This item proposes an amendment that is consequential to the insertion of new section 170MBA (see item 10 below).

 

Item 6 2 - Paragraph 170MB(1)( d f )

Item 7 3 - Paragraph 170MB( 1 2 )( f d )

Item 8 4 - Paragraph 170MB(2)( d f )

Item 9 - Paragraph 170 MB LX ( 2 4 )( f b )

 

1. 6 5 2      These items propose technical changes consequent upon the insertion of new sub section s 170MB ( 2A ) - ( 2D ) A [ item 10 5 of this Schedule] would make consequential amendments to clarify that the transmission of a certified agreement to a new employer under section 170MB is subject to any order made by the Commission under proposed section 170MBA. .

 

Item 10 5 - After subsection 170MB (2) At the end of Division 6 of Part VIB

 

1. 7 6 3      This item proposes to insert a new subsections section 170MB ( 2A ) , ( 5 4 2B ) A , (2C) and (2D) into the WR Act.

 

1. 7 4        Section 170MB provides for agreements in respect of a single business to bind a successor, transmittee or assignee employer (whether immediate or not).

 

1. 8 8 7 5    U nder section 170MB of the WR Act , where a n employer acquires or takes over a business or part of a business from another employer , a certified agreement that bound the original employer will bind the new employer (the ‘successor, assignee or transmittee’ of the business) , as far as the agreement relates to the business or the part of the business that is transmitting.   If the certified agreement was made under Division 2 of Part VIB of the Act, then the agreement can only transmit to a n ew employer that is a constitutional corporation or the Commonwealth .

 

1.9         New subsections section 170MB ()( 5 4 ) A (2A)-(2D) would allow the Commission to order that a certified agreement that would ordinarily transmit to a new employer under section 170MB   has has limited or no binding effect on the new employer , or only binds the new employer to a limited extent or for a limited period . a successor, transmittee or assignee of the business ,    or part of the business, to which a certified agreement applies.   This provision is intended to allow the Commission to make orders to avoid problems that may arise   where a certified agreement that would ordinarily bind the new employer is not appropriate to the new employer’s business, and to make orders to avoid problems associated with the interaction of multiple certified agreements following transmission. following a transmission of business The amendment would also  to bring the successor employer provision s of the Act regarding transmission of     in relation to certified agreements (section 170MB) into line with the equivalent provision s regarding transmission of award s ( under paragraph 149(1)(d) of the WR Act , the transmission of awards is already subject to any order of the Commission ) respondency ( section 149) .

 

 

 

1. 10 8 9    Proposed subsection (1) defines the terminology used in proposed section 170MBA this section :

 

·          The outgoing employer is the employer bound by a certified agreement who will is transmit ting , or has transmitted , the whole or a part of their business to another employer .

 

·          The incoming employer is the employer who, at a later time, becomes or is likely to become the successor, transmittee or assignee of th e outgoing employer’s business.

 

·          The business concerned is the whole or that part of the business that is transmitted by the outgoing employer to the incoming employer.

 

·          The transfer time is the time when the business or part of the business transmits from the outgoing employer to the incoming employer.

 

Commission may make order that certified agreement does not bind incoming employer

 

1. 11 9      Proposed s 1.6 S ubsection (2A) ( 2 ) would provide give the Commission with the power to make an order as to whether, or to what extent, an the new incoming employer is bound by a certified the agreement.  The order would be required to specify the day from which it takes effect, and could not be retrospective.

 

1. 12 9 10 Proposed s S ubsection ( 3 ) would clarify that one of the orders that the provide the Commission would hav can e possesses with the discretion to make under subsection (2) is order that an the agreement transmits bind s an incoming employer , but only for a specified period of time .   This provision is without prejudice to the power provided by subsection (2) .

 

When application for order can be made

 

1. 1 3 0 1 8 7          Proposed subsection (2B) (4) would clarify provide that an application for an order under the sub this section (2) can may be only be mad e e   at any time - before, at, or after or at the time a transmission of business occurs up on the an application of the employer bound by the agreement made before   or after the transmission of business has occur r ed . .



    It is envisaged that the Commission might make an order on application by:

the successor employer after the succession, assignment or transmission has occurred; or

· an employer that is contemplating a transfer of its business. In this situation, the Commission order would only take effect if a succession, assignment or transmission occurred.

 

Who may apply for order 1

 

1 . 1 4 1 2 9 8          Proposed subsections 170MBA(5) - ( 7) would would set out who may make an appl y ication for an order under subsection (2).

 

1.15     Proposed subsection (5) would provide that at a time before  a transmissio n n of business has actually occurred , an application for an order under subsection (2) may can only be made by the outgoing employer. where an order is sought before the transmission of business has occurred, the application may only be made by the outgoing employer.

  It is intended that this amendment should be applicable to all successions, assignments and transmissions of business, whether they occurred before or after the amendment commenced.

 

1. 1 6 2 3 0 9          Proposed New subsection (6) (2C) would require provide that where an application for an order under subsection (2) is made at or after the time of a transmission of business , or at a time after a transmission of business has occurred , it an  order is sought at or after the transmission of business, the application may be made by a number of people, including :

 

·          the incoming employer; or

 

·          an employee of the incoming employer whose employment is subject to the certified agreement in question; or

 

·          a registered organisation (for instance, a union) that is bound by the certified agreement in question and that is entitled to represent the industrial interests of employees of the incoming employer , whose employment is subject to the agreement , in relation to work that is subject to the agreement .

by : either

 

the successor, transmittee or assignee incoming employer ; or

an employee of the successor, transmittee or assignee incoming employe r: r

who is bound by the agreement; or

whose employment is subject to the agreement ; or

an organisation that :

who is bound by the agreement; and

 

1.17       However, proposed subsection (7) clarifies that in the case of an organisation bound by an agreement made under section 170LK of the WR Act (that is, a certified agreement made directly between an employer and the employer ’s employees), the organisation may only apply for an order under subsection 170MBA(2) if the organisation has at least one member:

 

·            who is an employee of the incoming employer and whose employment is subject to the certified agreement ; and

 

·            whose industrial interests the organisation is entitled to represent in relation to work that is subject to the agreement; and

 

·            who requested the organisation to apply for an order under subsection (2).

is entitled to represent the industrial interests of the employees.

 

Applicant to give notice of application

 

1.1 8 3 4    Proposed subsection (8) would require s the applicant for an order under subsection (2) to take reasonable steps to g ive notice of the application to those pe ople rsons who , or organisations that, are entitled to may make submissions to the Commission about regarding the application .   Subsections 170MBA(9) to (13) set out who may make submissions.

 

1.1 9 4      Proposed subsection s ( 9 1 0 ) , (11) and (1 2 )   require s that , before the Commission , before   it m to akes an order, it must to give the applicant and , specified people and organisations an opportunity to make submissions before it decides whether to make an order under subsection 170MBA(2). depending on the time of [ application / hearing / order], specified   In all cases, the applicant for an order is to be given the opportunity to make submissions.  The other people and organisations who can make submissions will depend on when the application for an order under subsection (2) is made. persons and organisations specified in either proposed subsection ( 10 12 ) or proposed subsection ( 12 14 ), bound by the agreement an opportunity to make submissions .  



 

Submissions - before t transfer time ransmission

 

1. 20 1 5 5 Where Commission hearings regarding an application for an order under subsection 170MBA(2) occur before the transmission of business has taken place , subsection (10) Proposed subsection (1 0 2 )   specifies that, in addition to the applican t , the following people and organisations must be  the persons and organisation s (in addition to the applicant) to who m the Commission must give n an opportunity to make submissions if the [ ???? application is made / hearing occurs / order is made ???? ] before the transfer time .   Where an order is sought before the transmission of business has occurred Those persons and organisations are :

.

the applicant;

· the employer who would be the successor, transmittee or assignee employer if the transmission of business occurred;

·            an employee s of the applicant outgoing employer , who are i s employed in the part of the business that is likely to transmit to the incoming employer proposed to be transmitted concerned , and whose employment is subject to the agreement; and

 

  who is bound by the agreement; or

  whose employment is subject to the agreement ; and ;

·               who is employed in the part of the business proposed to be transmitted ; the incoming employer who would be the successor, transmittee or assignee employer if the transmission of business occurred ; and

·             

 

 

·            an employee s of the incoming employer whose employment may become subject to the agreement if the agreement transmit t s ed to the incoming employer ; and :

 

  who would be come bound by the agreement if the agreement transmitted ; or

whose employment may become subject to the agreement if the agreement transmitted;

 

·               an organisation that is bound by the agreement and entitled to represent the industrial interests of the employees of the outgoing or incoming employer (whose employment is or may become subject to the agreement) in relation to work that is subject to the agreement .

●   an organisation that

· is bound by the agreement ; and

·                         is entitled to represent the industrial i nterests of the employees .

 

1. 21 1 6 6 However, proposed subsection (11) clarifies that in the case of an organisation bound by an agreement made under section 170LK of the WR Act (that is, a certified agreement made directly between an employer and the employer’s employees), the organisation may only make submissions if the organisation has at least one member:

 

·            who is an employee of the outgoing employer whose employment is subject to the agreement and who is employed in the business concerned; or an employee of the or incoming employer whose employment is or may become subject to the certified agreement ; and

 

·            whose industrial interests the organisation is entitled to represent in relation to work that is subject to the agreement; and

 

·            who requested the organisation to make submissions .

 

Submissions - at or after tra nsmission nsfer time

 

However, under proposed subsection s (11) an organisation bound by an agreement made in accordance with section 170LK would only to be entitled to make an application under subsection (5) or make submissions under subsection (10 ) if asked to do so by a member of the organisation:

who is bound by the agreement or 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.

 

1. 22 1 7    Where Commission hearings regarding an application for an order under subsection 170MBA(2) occur at or after the time of a transmission of business , or after a transmission of business has taken place , subsection (12) specifies that, in addition to the applicant, the following people and organisations must be given an opportunity to make submissions:

Proposed subsection (1 2 4 ) specifies the persons and organisations (in addition to the applicant) to whom the Commission must give an opportunity to make submissions if the [ ???? application is made/ hearing occurs/ order is made ???? ] at or after the transfer time.  Those persons and organisations are:

Where the order is sought at or after the transmission of business:

·            the incoming employer; and

 

·            an employee of the incoming employer , whose employment is subject to the agreement ; and

 

  who is bound by the agreement; or

  whose employment is subject to the agreement;

·               an organisation that

·               is bound by the agreement ; and

·              is entitled to represent the industrial interests of the employees of the incoming employer whose employment is subject to the agreement , in relation to work that is subject to the agreement such an employee s .

 

 

1. 23 1 7 7 2 0            However, under proposed new subsection (2D) 0 3 , (13) (1 3 5 4 ) an organisation bound by an agreement made directly between an employer and the employer’s employees (i.e. an agreement made in accordance with section 170LK ) would only to be entitled to make an application under subsection (5) or make submissions under subsections  or (12) (12) if asked to do so by a member of the organisation:

· who is bound by the agreement or 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 . However, proposed subsection (13) clarifies that in the case of an organisation bound by an agreement made under section 170LK of the WR Act (that is, a certified agreement made directly between an employer and the employer’s employees), the organisation may only make submissions if the organisation has at least one member:

 

·            who is an employee of the incoming employer , 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; and

 

·            who requested the organisation to make submissions.

 

Item 11 6 - Subsection 494(3)

 

 

1. 1 24 18 8 3 1      Th is is item propose s s to amend Part XV of the WR Act, which to provide s for the expanded operation in Victoria of the provisions contained in other Parts of sections 170MB and 170MBA within Victoria. In 1996, t T he Victorian Government referred many of its industrial relations powers to the Commonwealth Government under the Commonwealth Powers (Industrial Relations) Act 1996 (Vic) . Division 2 of Part VIB of the WR Act.

 

1. 25 1 9 9 4 2        E The e xisting s S ubsection 494(3) , which currently provides for the expanded operation of existing section 170MB within Victoria, will be repealed and replaced by substituted with two new subsections.

 

1.2 6 0    Proposed new subsection 494(3) would provide that section 170MB, as amended by this Bill, applies so that a s for certified agreement made under Division 2 of Part VIB (an agreement made between an employer who is a constitutional corporation or the Commonwealth and its employees or organisations representing its employees ) will transmit with a business or part of a business s to bind the a successor, assignee or transmittee employer in circumstances where one of the the successor, assignee or transmittee employer s is a Victorian employer . an employer within the meaning of Part XV of the WR Act.   The amendment proposed by item 1 0 6 would replace subsection 494(3) to ensure that the Commission had the same powers in relation to such agreements as are proposed in respect of certified agreements generally [items 7 3 - 9 5 of this Schedule].   Normally, under section 170MB, a Division 2 agreement can only transmit to an employer that is a constitutional corpo r ation or the Commonwealth. However, due to the referral of power s by the Victorian Government, this provision will have wider application in Victoria , so that Division 2 agreements can transmit to any Victorian employer .

 

1.2 7 1    Proposed new subsection 494(4) would modify the operation of proposed new section 170MBA in Victoria.  Subsection 494(4) would allow provide for the Commission to make orders about the extent to which a successor , assignee or transmittee employer within Victoria ( within the meaning of Part XV of the WR Act) is bound by a transmitting certified agreement.   Th e is intention is to  would ensure that give the Commission has the same powers in relation to making orders about when certified agreements transmit to Victoria n employers , such agreements as are proposed in respect of certified agreements generally (see item 10 above) [Item 10 of this Schedule] . .