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Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2017

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2016-2017

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

HOUSE OF REPRESENTATIVES

 

 

 

 

 

 

 

FAIR WORK (REGISTERED ORGANISATIONS) AMENDMENT

(ENSURING INTEGRITY) BILL 2017

 

 

 

 

 

EXPLANATORY MEMORANDUM

 

 

 

 

 

 

 

(Circulated by authority of the Minister for Employment, Senator the Hon Michaelia Cash)

 

 

 

 

 





 



FAIR WORK (REGISTERED ORGANISATIONS) AMENDMENT

(ENSURING INTEGRITY) BILL 2017

OUTLINE

The Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2017 (the Bill) amends the Fair Work (Registered Organisations) Act 2009 (the Act) to respond to community concern and the recommendations of the Final Report of the Royal Commission into Trade Union Governance and Corruption (the Royal Commission) to ensure the integrity of registered organisations and their officials, for the benefit of members.

Registered employee and employer organisations are placed in a privileged position in Australia’s workplace relations system and their members place a great deal of trust in them. 

The Royal Commission, however, uncovered numerous examples of organisations and officials repeatedly flouting the law, misappropriating union funds, putting their own interests before members and generally failing to meet the basic standards of accountability and governance that members and the community more broadly, should be able to expect from registered organisations.

In response, the Royal Commission made a number of observations and recommendations. These included highlighting the insufficiency of the current regulatory framework in relation to the disqualification of registered organisations’ officers from office, the regime for cancellation of registration of registered organisations’ and the potential to use the amalgamation procedure to avoid cancellation of registration.

The Bill responds to Royal Commission recommendations 36, 37 and 38 and the Government’s commitment to fairness and transparency in workplaces by amending the Act to:

·                      include serious criminal offences punishable by five or more years’ imprisonment or more as a new category of ‘prescribed offence’ for the purposes of the automatic disqualification regime which prohibits a person from acting as an official of a registered organisation;

·                      allow the Federal Court to prohibit officials from holding office who contravene a range of industrial and other relevant laws, are found in contempt of court, repeatedly fail to stop their organisation from breaking the law or are otherwise not a fit and proper person to hold office in a registered organisation;

·                      make it an offence for a person to continue to act as an official or in a way that influences the affairs of an organisation once they have been disqualified;

·                      allow the Federal Court to cancel the registration of an organisation on a range of grounds including corrupt conduct by officials, repeated breaches of a range of industrial and other laws by the organisation or its members and the taking of obstructive unprotected industrial action by a substantial number of members;

·                      allow applications to be made to the Federal Court for other orders, including suspending the rights and privileges of an organisation or an individual branch or division of an organisation where its officers or members are acting in a manner that is inconsistent with the rights and privileges of registration;

·                      expand the grounds on which the Federal Court may order remedial action to deal with governance issues in an organisation and expressly provide that the Federal Court may appoint an administrator to an organisation or part of an organisation as part of a remedial scheme;

·                      introduce a public interest test for amalgamations of registered organisations, which will allow relevant matters to be taken into account such as each organisation’s record of compliance with industrial laws.

The new disqualification regime for officers of registered organisations in the Bill will ensure more acceptable minimum standards of behaviour and accountability for officers and promote democratic governance in the interests of members of registered organisations.

The measures in the Bill also implement the Government’s election commitments to effectively deal with registered organisations that are dysfunctional or not serving the interests of their members and to provide that registered organisations’ amalgamations are subject to a public interest test.

In addressing these issues, the amendments will combat the culture of lawlessness identified by the Royal Commission and improve the governance of registered organisations.

The Bill also makes a number of minor and technical amendments to the Act subsequent to the passage of the Fair Work (Registered Organisations) Amendment Act 2016 .



FINANCIAL IMPACT STATEMENT

Nil



REGULATION IMPACT STATEMENT

The Interim and Final reports of the Royal Commission into Trade Union Governance and Corruption have been certified by the Department of Employment as being informed by a process and analysis equivalent to a Regulation Impact Statement as set out in the Australian Government Guide to Regulation. The Office of Best Practice Regulation ID for this proposal is 19873. The Office of Best Practice Regulation does not assess independent reviews.

These Royal Commission reports can be accessed at:

https://www.tradeunionroyalcommission.gov.au/reports/Pages/default.aspx .

 



STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2017

The Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2017 (the Bill) is compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Overview of the Bill

The object of the Fair Work (Registered Organisations) Act 2009 (the Act) is to enhance relations within workplaces and to reduce the adverse effects of industrial disputation. By requiring associations of employers and employees to meet the standards set out in the Act in order to gain a range of rights and privileges, those relations will be enhanced and the adverse effects will be reduced.

The Bill amends the Act to respond to community concern and the recommendations of the Final Report of the Royal Commission into Trade Union Governance and Corruption (the Royal Commission) to ensure the integrity of registered organisations and their officials, for the benefit of members. The Royal Commission uncovered numerous examples of organisations and officials repeatedly flouting industrial and other laws, putting their own interests before members and generally failing to meet the basic standards of accountability and governance that members and the community more broadly, should be able to expect from registered organisations.

The Royal Commission highlighted the insufficiency of the current regulatory framework in relation to disqualification of officers of registered organisations from office, the regime for the cancellation of registration of registered organisations’ and the potential to use the amalgamation procedure to avoid cancellation of registration.

The Bill responds to Royal Commission recommendations 36, 37 and 38 and the Government’s commitment to fairness and transparency in workplaces by amending the Act to:

·                      include serious criminal offences punishable by five or more years’ imprisonment as a new category of ‘prescribed offence’ for the purposes of the automatic disqualification regime which prohibits a person from acting as an official of a registered organisation;

·                      allow the Federal Court to prohibit officials from holding office who contravene a range of industrial and other relevant laws, are found in contempt of court, repeatedly fail to stop their organisation from breaking the law or are otherwise not a fit and proper person to hold office in a registered organisation;

·                      make it an offence for a person to continue to act as an official or in a way that influences the affairs of an organisation once they have been disqualified;

·                      allow the Federal Court to cancel the registration of an organisation on a range of grounds including corrupt conduct by officials, repeated breaches of a range of industrial and other laws by the organisation or its members and the taking of obstructive unprotected industrial action by a substantial number of members;

·                      allow applications to be made to the Federal Court for other orders, including suspending the rights and privileges of an organisation or an individual branch or division of an organisation where its officers or members are acting in a manner that is inconsistent with the rights and privileges of registration;

·                      expand the grounds on which the Federal Court may order remedial action to deal with governance issues in an organisation and expressly provide that the Federal Court may appoint an administrator to an organisation or part of an organisation as part of a remedial scheme;

·                      introduce a public interest test for amalgamations of registered organisations, which will allow relevant matters to be taken into account such as each organisation’s record of compliance with industrial laws.

The new disqualification regime for officers of registered organisations will ensure appropriate minimum standards of behaviour and accountability for officers and promote democratic governance in the interests of members of registered organisations.

The measures in the Bill also implement the Government’s election commitments to effectively deal with registered organisations that are dysfunctional or not serving the interests of their members and to provide that registered organistions’ amalgamations are subject to a public interest test.

In addressing these issues, the amendments will combat the culture of lawlessness identified by the Royal Commission and improve the governance of registered organisations.

Human rights implications

The definition of ‘human rights’ in the Human Rights (Parliamentary Scrutiny) Act 2011 relates to the seven core United Nations human rights treaties. The Bill engages with the following rights:

·                      rights in work in Article 22 of the International Covenant on Civil and Political Rights (ICCPR) and Articles 6 and 8(1)(a) of the International Covenant on Economic, Social and Cultural Rights (ICESCR) including:

o    the right to freedom of association;

o    the right to form and join trade unions; and

o    the right of trade unions to function freely;

The content of the rights to work and rights in work in the ICESCR can be informed by specific obligations in treaties of the International Labour Organization (ILO), such as the Freedom of Association and Protection of the Right to Organise Convention 1948 (No. 87) (ILO Convention 87), which provides employer and employee organisations with protection for their organisational autonomy.

·                      the right to take part in public affairs and elections in Article 25 of the ICCPR;

·                      the right to the presumption of innocence and the minimum guarantees in Article 14 of the ICCPR; and

·                      the right to privacy and not to be subject to unlawful attacks on a person’s reputation in Article 17 of the ICCPR.

The Right to Freedom of Association and the Right to take part in Public Affairs and Elections

The Right to Freedom of Association

Article 6(1) of the ICESCR provides for the right to work. The exercise of work requires the existence of just and favourable conditions of work, including the right to form trade unions. [1]

Article 22(1) of the ICCPR protects the right to freedom of association, including the right to form and join trade unions. Article 8(1)(a) of the ICESCR also provides for:

The right of everyone to form trade unions and join the trade union of his choice, subject only to the rules of the organization concerned, for the promotion and protection of his economic and social interests. No restrictions may be placed on the exercise of these rights other than those prescribed by law and which are necessary in a democratic society in the interests of national security or public order or for the protection of the rights and freedoms of others.

Article 8(1) of ILO Convention 87 provides that:

1.       In exercising the rights provided for in this Convention workers and employers and their respective organisations, like other persons or organised collectives, shall respect the law of the land.

2.       The law of the land shall not be such as to impair, nor shall it be so applied as to impair, the guarantees provided for in this Convention.

ILO Convention 87 also provides employer and employee organisations with protection for their organisational autonomy. Article 3 of Convention 87 provides:

1.       Workers’ and employers’ organisations shall have the right to draw up their constitutions and rules, to elect their representatives in full freedom, to organise their administration and activities and to formulate their programmes.

2.         The public authorities shall refrain from any interference which would restrict this right or impede the lawful exercise thereof.

The ILO Committee on Freedom of Association has made the following observations on the rights of organisations to organise their administration:

Legislative provisions which regulate in detail the internal functioning of workers’ and employers’ organizations pose a serious risk of interference by the public authorities. Where such provisions are deemed necessary by the public authorities, they should simply establish an overall framework in which the greatest possible autonomy is left to the organizations in their functioning and administration. Restrictions on this principle should have the sole objective of protecting the interests of members and guaranteeing the democratic functioning of organizations. Furthermore, there should be a procedure for appeal to an impartial and independent judicial body so as to avoid any risk of excessive or arbitrary interference in the free functioning of organizations. [2]

Amendments

On the basis of these observations, the following amendments in the Bill engage the right to freedom of association and insofar as they engage that right also engage the right to take part in public affairs and elections:

·                      amending the regime for disqualification of officers (recommendations 36-38 of the Royal Commission);

·                      amending the regime for cancellation of registration of organisations;

·                      broadening the grounds for a remedial scheme to be approved by the Federal Court, including the appointment of an administrator, when officers of an organisation or branch are no longer serving member’s interests; and

·                      introducing a public interest test for amalgamations of registered organisations.

The right recgonises that organisations and officials, like other persons or organised collectives, shall respect the law of the land.Where the provisions of the Bill engage the right to freedom of association, any  limitations on the right are permissible as they pursue a legitimate objective, are prescribed by law and are reasonable, necessary and proportionate. They have the sole objective of protecting the interests of members and guaranteeing the democratic functioning of organisations.

1.                   Amendments to the regime for the disqualification of officers (recommendations 36-38 of the Royal Commission)

The Bill adds a ground for automatic disqualification from holding office (recommendation 36), makes it a criminal offence for a person who is disqualified from holding office in a registered organisation to continue to hold office or to act in a manner that influences the conduct of the organisation (recommendation 37), and gives the Federal Court discretion to disqualify a person from holding any office in a registered organisation for the period of time the Court considers appropriate (recommendation 38) .

These new provisions, are made pursuant to the legitimate objectives of improving the governance of registered organisations and protecting the interests of members. Any limitations on the capacity of registered organisations to regulate their affairs as they see fit  are a necessary and proportionate means of improving the governance of registered organisations. The amendments have the objective of protecting the interests of members and guaranteeing public order by ensuring the leadership of registered organisations acts lawfully.

This approach is required to ensure that officials who deliberately flout the law are restricted in their ability to be in charge of registered organisations. [3] The procedure for disqualification from office will continue to be supervised by the Federal Court, an impartial and independent judicial body from which appeals to a Full Federal Court and to the High Court are available, so as to avoid any risk of excessive or arbitrary interference in the free functioning of organisations.

2.                   Amendments to the regime for cancellation of registration of organisations 

The Bill expands the grounds for and streamlines the regime for the cancellation of registration of registered organisations. The new grounds for cancellation will be available where an organisation or its officials or members have broken the law. The amendments do not limit the ability of members to form and join trade unions.

The right recgonises that organisations and officials, like other persons or organised collectives, shall respect the law of the land. The provisions  have the sole objective of protecting the interests of members and guaranteeing the democratic functioning of organisations under the stewardship of officials and a membership that respects the law and thus maintains public order.

These measures will improve the effectiveness of the provisions in the Act concerning cancellation of registration as they:

·                      address the costly and lengthy process under the Act that the Royal Commission found to be one of the impediments to deregistration; [4] and

·                      facilitate the continued existence and functioning of an organisation or some of its component parts in circumstances in which one part of the organisation is affected by maladministration or dysfunction associated with a culture of lawlessness.

These measures are proportionate as they are made with the sole objective of benefiting members. The measures:

·                      protect the rights of members in that the amendments have the objective of protecting the interests of members and guaranteeing public order by ensuring an organisation is administered lawfully;

·                      limit the effect on members who have not been involved in activity that would ground an order for cancellation of registration by providing for orders to be limited to the part of the organisation that has conducted these activities; and

·                      do not impact on the rights of workers to continue to be represented by a registered organisation and take the likely benefit to members of the existing organisations into account.

3.                   Amendments to the regime for the remediation of dysfunction and lawlessness

The Bill expands the grounds for a remedial scheme to be approved by the Federal Court, including the appointment of an administrator, when officers of an organisation or branch are no longer serving members’ interests.

These measures have the sole objective of protecting the interests of members and guaranteeing the democratic functioning of organisations under the stewardship of officials and a membership that respects the law and thus maintains public order.

The measures will improve the effectiveness of the administration provisions as they facilitate the continued functioning of an organisation or its component parts in circumstances in which administration or interim administration is required to overcome maladministration or dysfunction associated with a culture of lawlessness or financial maladministration.

These measures are proportionate as they are made with the sole objective of benefiting members. The measures:

·                      protect the interests of members and guarantee public order by ensuring an organisation is administered lawfully;

·                      protect union members who have not been involved in maladministration or unlawful activity by providing for orders to be limited to the part of the organisation that has conducted these activities;

·                      provide only for the appointment of an administrator or interim administrator under a scheme in new Part 2A of Chapter 11 if the Court is satisfied that it is in the best interests of members of the organisation; and

·                      do not impact on the rights of workers to continue to be represented by a registered organisation.

4.                   Introduction of a public interest test for amalgamations of registered organisations

The amendments provide for a public interest test for amalgamations of registered organisations which will allow the FWC to take relevant matters into account, such as the relevant organisations’ record of compliance with industrial and other laws, when determining an application for amalgamation.

An object of the Act is to enhance relations within workplaces and to reduce the adverse effects of industrial disputation. By requiring registered organisations to meet the standards set out in the Act in order to gain a range of rights and privileges, it is considered that those relations will be enhanced and the adverse effects will be reduced.

The amendments are necessary in a democratic society as they will empower the FWC with more effective assessment and oversight of applications for amalgamation under the Act. The measures will reduce the risk of an adverse effect of an amalgamation of existing organisations on the Australian economy, including relevant industrial sectors, and employers and employees in the industry or industries concerned.

These amendments engage the right of freedom of association and are proportionate in that they:

·                      do not impact on the rights of workers to continue to be represented by a registered organisation and take the likely benefit to members of the existing organisations into account; and

·                      further protect the interests of members by helping to ensure the democratic functioning of organisations under the stewardship of officials who respect the law and thus maintain public order.

Right to the presumption of innocence and other guarantees

The right to the presumption of innocence and the minimum guarantees contained in Article 14 of the ICCPR is relevant to some of the new criminal offences in the Bill. H owever, the provisions are not inconsistent with the right to the presumption of innocence as they are reasonable, necessary and proportionate in pursuit of a legitimate objective.

When strict liability applies to an offence, the prosecution is only required to prove the relevant physical and not the fault elements of the offence.

The Bill contains the following new strict liability offences:

·                      the offences in relation to a person who is disqualified from holding office by the Federal Court, standing for or continuing to hold either an actual or de facto office (in section 226);

·                      the offence in relation to helping administrators (section 323G); and

·                      the offence in relation to administrators’ access to an organisation’s books (section 323H).

1.                   The offences in relation to a person who is disqualified from holding office by the Federal Court, standing for office or continuing to hold office (in section 226)

The Royal Commission recommended that the offence of continuing in office while disqualified should be an offence of strict liability to address the gap in the Act that currently provides no consequences for a person who stands for or continues to hold either an actual or de facto office whilst disqualified. [5] This limitation is reasonable, necessary and proportionate in cases where a person has been disqualified from holding office by the Federal Court because:

·                      the lack of a strong sanction in these circumstances, including strict liability elements of the relevant offence, may encourage further non-compliance with the Act, the Fair Work Act 2009 (FW Act) and other relevant laws;

·                      the Corporations Act provides that it is an offence for a person disqualified from managing a corporation to do so and similarly applies strict liability to the circumstance of whether or not a person is disqualified from managing corporations. Under section 206A of the Corporations Act, strict liability applies to the element of the offence concerning whether or not the relevant person is disqualified from managing a corporation under the Corporations Act;

·                      the strict liability elements of the offences are clear and straightforward; the Federal Court either has or has not disqualified a person from holding office under the Act. Requiring proof of fault for this element of the offences would undermine the integrity and effectiveness of the regulatory and enforcement regime for disqualification of officials. Strict liability applies only if the person is disqualified under an order made under new sections 28N or 222 and does not apply where an officer has been automatically disqualified under section 215 of the Act; and

·                      the defence of honest and reasonable mistake of fact is also available for these offences where the defendant has turned his or her mind to the existence of these facts (see section 9.2 of the Criminal Code Act 1995 (Criminal Code)).

2.                   The offence in relation to assisting administrators (section 323G) and the offence in relation to administrators’ access to an organisation’s books (section 323H)

The amendments requiring officers and employees of registered organisations to assist administrators and entitling an administrator to access an organisation’s books are intended to assist an administrator appointed by the Federal Court under new Part 2 of Chapter 11 to effectively carry out their functions. These are important provisions that ensure an administrator can carry out their role in remediating an organisation that has become dysfunctional or is no longer serving its members’ interests.

These strict liability offence provisions are reasonable, necessary and proportionate because:

·                      strict liability offences are a common feature of regulatory frameworks underpinning corporate regulation in the Corporations Act and are the appropriate comparator for the administration provisions in the Bill. In particular, the proposed strict liability offences replicate identical strict liability offences in the Corporations Act (see proposed sections 323G and 323H of the Bill and sections 438B and 438C of the Corporations Act) and are necessary and appropriate to enforce obligations arising from an administrator’s functions and powers;

·                      the strict liability elements of the offences are clear and straightforward and are necessary to ensure the integrity and effectiveness of the regulatory regime to optimise the opportunity for remedial administration of dysfunctional organisations;

·                      the defence of honest and reasonable mistake of fact is also available for these offences where the defendant has turned his or her mind to the existence of these facts (see section 9.2 of the Criminal Code); and

·                      the strict liability offence in relation to assisting administrators (section 323G) also contains a defence of reasonable excuse, consistent with the comparable offence in section 438B of the Corporations Act. Explicit provisions are also included so that the offence is not intended to override the privilege against self-incrimination or legal professional privilege (subsections 323G(4) and (5)).

Conclusion

The Bill is compatible with human rights because any restriction is for a purpose that falls within one of the permitted grounds for restriction under the relevant article, the measures will be effective in achieving better governance of registered organisations.  T o the extent that the Bill may limit human rights, those limitations are reasonable, necessary and proportionate .

 

Minister for Employment, Senator the Hon Michaelia Cash

 



NOTES ON CLAUSES

In these notes on clauses, the following abbreviations are used:

Act

Fair Work (Registered Organisations) Act 2009

Amendment Act

Fair Work (Registered Organisations) Amendment Act 2016

Bill

Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2017

Corporations Act

Corporations Act 2001

Criminal Code

Criminal Code Act 1995

Final Report

Hon John Dyson Heydon AC QC’s Final Report of the Royal Commission into Trade Union Governance and Corruption

FW Act

Fair Work Act 2009

FWC

Fair Work Commission

Regulations

Fair Work Regulations 2009

Commissioner

Registered Organisations Commissioner

Royal Commission

Royal Commission into Trade Union Governance and Corruption

Clause 1 - Short title

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

Clause 2 - Commencement 

2.                   The table in this clause sets out when the provisions of the Bill commence.

Clause 3 - Schedules

3.                   Clause 3 of the Bill provides that legislation 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 - AMENDMENTS RELATING TO DISQUALIFICATION FROM OFFICE

 



4.                   Schedule 1 will amend the Act in relation to disqualification from office. The amendments will expand the circumstances in which a person may be disqualified from office and make it a criminal offence for a person who is disqualified from holding office in a registered organisation to continue to hold office or act in a manner that would significantly influence the organisation.

Fair Work (Registered Organisations) Act 2009

Item 1 - Section 6

5.                   This item amends section 6 by inserting four new definitions related to the new provisions contained in the Bill. Key concepts that underpin the various schedules in Bill are:  

·            designated finding (new subsection 9C(1));

·            designated law (new subsection 9C(2)); and

·            wider criminal finding (new subsection 9C(3)).

6.                   The item inserts a new definition of ‘designated finding’ for the purposes of new sections 223 (Grounds for disqualification from office), 28D (Cancellation of registration - multiple findings against organisation) and 28F (Cancellation of registration - multiple findings against members) and 72E (Compliance record events). The new definition provides that a ‘designated finding’ has the meaning provided in new section 9C.

7.                   The item also inserts a new definition of ‘designated law’ that is relevant to the definition of ‘designated finding’ provided in new section 9C and relevant to new sections 223 (Grounds for disqualification from office), 28G (Cancellation of registration - noncompliance with orders or injunctions) and 323 (Declaration of dysfunction etc). The new definition provides that a ‘designated law’ has the meaning provided in new section 9C.

8.                   This item also inserts a new definition of ‘wider criminal finding’ relevant to new sections 223 (Grounds for disqualification from office), 28D (Cancellation of registration - multiple findings against organisation) and 72E (Compliance record events). The new definition provides that a ‘wider criminal finding’ has the meaning provided in new section 9C.

9.                   Finally, this item also inserts a new definition of ‘disqualified from holding office in an organisation’ and provides that the term has the meaning given by new section 225. New section 225 defines a person disqualified from holding office in an organisation or branch as:

·            a person not eligible to be a candidate for election to, or to hold, an office in an organisation or branch of an organisation under subsection 215(1); or

·            a person disqualified from holding office in an organisation or branch of an organisation under sections 28N or section 222.

Item 2 - After Section 9B

10.               This item inserts new sections 9C and 9D providing the definitions of ‘designated finding’, ‘designated law’ and ‘wider criminal finding’ and when findings will apply to an organisation.

Section 9C - Designated findings, designated laws and wider criminal findings

11.               New subsection 9C(1) provides that a ‘designated finding’ is:

·            a finding in criminal proceedings that a person has committed an offence under a ‘designated law’; or

·            in any civil proceedings, that the organisation has contravened, or been involved in a contravention of:

o     a civil penalty provision of the Act;

o     a civil remedy provision of the FW Act;

o     a civil remedy provision of the Building and Construction Industry (Improving Productivity) Act 2016 ;

o     a civil remedy provision of the Fair Work (Building Industry) Act 2012 as in force at any time before its repeal;

o     a provision of Part IV of the Competition and Consumer Act 2010 or a provision of the Competition Code of a State or Territory (other than an offence);

o     a WHS civil penalty provision of the Work Health and Safety Act 2011 ; or

o     a provision of a State or Territory OHS law within the meaning of the FW Act (other than an offence).

12.               New subsection 9C(2) provides that a‘designated law’ is:

·            the Act;

·            the FW Act;

·            the Building and Construction Industry (Improving Productivity) Act 2016 ;

·            the Fair Work (Building Industry) Act 2012 as in force at any time before its repeal;

·            Part IV of the Competition and Consumer Act 2010 and any other provision of the Act so far as it applies in relation to Part IV, and the Competition Code of each State or Territory;

·            the Work Health and Safety Act 2011 ;

·            each State or Territory OHS law within the meaning of the FW Act; or

·            Part 7.8 of the Criminal Code (causing harm to, an impersonation and obstruction of, Commonwealth public officials) and any other provision of the Code so far as it applies in relation to that Part.

13.               Compliance with the legislation listed in the new definitions of ‘designated finding’ and ‘designated law’ goes to the heart of the effective operation of the workplace relations system and by extension, the effective and lawful management of registered organisations. The legislation listed in each definition has been adapted from the list of circumstances in which Commissioner Heydon recommended that the Federal Court be given capacity to disqualify a person from holding office in an organisation. [6] Organisations and officers that do not comply with these legislative regimes cannot be considered to be lawfully and effectively representing the interests of organisation members as a whole.

14.               New subsection 9C(3) provides that a ‘wider criminal finding’ is a finding, other than a designated finding, in any criminal proceedings that a person has committed an offence against any law of the Commonwealth, a State or Territory. 

Section 9D - Findings against part of an organisation

15.                New section 9D provides that a finding made against a part of an organisation will, for the purposes of the Act, be taken to have been made against the organisation.

Item 3 - Division 1 of Part 4 of Chapter 7 (heading)

16.               This item repeals and replaces the current heading of Division 1. The new heading for Division 1 is ‘Preliminary’. 

Item 4 - At the end of section 210

17.               This item amends the simplified outline of Part 4 of Chapter 7 set out in section 210 to cover new Divisions 3 and 4.

18.               The amendments to section 210 amend the description of Part 4 of Chapter 7 to account for new Division 3 that allows the Commissioner, the Minister and persons with sufficient interest, to apply to the Federal Court for an order disqualifying a person from holding office in an organisation. Section 210 has also been amended to note that sections in new Division 4 will make it an offence for a person disqualified from holding office in an organisation, to stand for, or hold, or act as though the person holds, office in an organisation.

Item 5 - At the end of Division 1 of Part 4 of Chapter 7

Section 210A - Application of this Part to branches

19.               New section 210A provides that a reference in Part 4 of Chapter 7 to ‘an office in, or holding office in an organisation’ includes a reference to an office in a branch of an organisation or holding office in a branch of an organisation. The new section also provides that a reference to ‘an officer in an organisation’ in Part 4 of Chapter 7 will include a reference to an officer in a branch of an organisation.

20.               This new section aligns the existing disqualification provisions in Division 2, Part 4 of Chapter 7 with the new disqualification provisions that will be inserted in new Division 3, Part 4 of Chapter 7. The new disqualification provisions apply to holding office in a branch of an organisation andnot just an organisation. 

21.               New subsection 210A(2) specifically notes that this section does not limit the operation of subsection 9(2) of the Act which provides that a reference to an office in an association or organisation includes a reference to an office in a branch of the association or organisation.

Item 6 - After paragraph 212(a)

22.               This item inserts new paragraph 212(aa) into existing section 212 to expand the definition of ‘prescribed offence’. Section 212 defines prescribed offence for the purposes of Division 2, Part 4 of Chapter 7, which provides when a person will be disqualified from holding office because they have been convicted of a prescribed offence.

23.               Recommendation 36 of the Final Report was that the definition of prescribed offence in section 212 be expanded to include a category of ‘serious offences’. The Final Report defined serious offences as offences under a law of the Commonwealth, State or Territory punishable on conviction by a maximum penalty of imprisonment for life or a period of five years or more.

24.               The insertion of the new paragraph 212(aa) expands the definition of prescribed offence to include an offence under a law of the Commonwealth, a State or Territory, or another country, punishable upon conviction by imprisonment for life or a period of five years or more. Section 215 provides that a person convicted, per section 213, of one of the prescribed offences set out in section 212 is disqualified from holding office (subject to the person making an application for leave to hold office or a reduced period of exclusion under sections 216 or 217). 

25.               The effect of item 15(1) is that automatic disqualification will not apply to a conviction for an offence of the type listed in new paragraph 212(aa) if the conviction occurred before commencement of this Schedule. 

Item 7 - Subsection 215(1)

26.               This item amends subsection 215(1) to streamline the terms used in the section to take into account the offences created in new section 222 and align the terms used in section 215 with those used in the disqualification provisions in new Division 3, Part 4 of Chapter 7 and offence provisions in new Division 4, Part 4 of Chapter 7.

27.               Subsection 215(1) currently provides that a person convicted of one of the prescribed offences set out in section 212 is disqualified from being a candidate in an election for office and from being elected or appointed to office. This amendment to subsection 215(1) is consequential to the new offences to provide that a person convicted of a prescribed offence is disqualified from being elected to, or holding, office.

Item 8 - At the end of subsection 215(1)

28.               This item adds a new note to amended subsection 215(1) to explain that the effect of new section 225 will be that a person who is disqualified from holding office is also not eligible to be a candidate for election to, or to hold, office in a branch of an organisation.

 Item 9 - At the end of Part 4 of Chapter 7

29.               This item inserts new Divisions 3 and 4 of Part 4, Chapter 7.

30.               New Division 3 includes new sections 221-223 which respond to recommendation 38 of the Royal Commission. Recommendation 38 was that the Federal Court be provided with the jurisdiction to disqualify a person from holding office in a registered organisation for a period of time the Court considers appropriate.  

Section 221 - Simplified outline of this Division

31.               New section 221 provides a simplified outline of Division 3 of Part 4 of Chapter 7 and explains that the Federal Court may make an order disqualifying a person from holding office in an organisation on the grounds set out in section 223 if the court does not consider that it would be unjust to disqualify the person.

Section 222 - Disqualification orders

32.               New subsection 222(1) provides that the Commissioner, the Minister or a person with sufficient interest, can apply to the Federal Court for an order disqualifying a person from holding office in an organisation or a branch of an organisation if the applicant considers one or more of the grounds set out in section 223 applies.

33.               ‘Sufficient interest’ has been interpreted as an interest beyond that of an ordinary person and includes those whose rights, interests or legitimate expectations would be affected by the decision.

34.               New subsection 222(2) provides that the Federal Court can make an order disqualifying the person from holding office for any period the Court considers appropriate if the Court is satisfied that a ground for disqualification set out in the application applies to the person and, the Court does not consider it would be unjust to disqualify the person. In determining whether disqualifying a person from office would be unjust, the Court must have regard to:

·            the nature of the matters that constituted the ground for disqualification (new subparagraph 222(2)(b)(i));

·            the circumstances and nature of the person’s involvement in the matters constituting the ground for disqualification (new subparagraph 222(2)(b)(ii)); and

·            any other matter the Court considers relevant (new subparagraph 222(2)(b)(iii).

35.               New subsection 222(3) clarifies that if the Federal Court makes an order under new subsection 222(2), the person is also disqualified from holding office in a branch of an organisation.

36.               Finally, subsection 222(4) provides that if the Federal Court makes an order under subsection 222(2), a copy of that order must be given to the Commissioner.

Section 223 - Grounds for disqualification

37.               New section 223 sets out the prima facie grounds that enliven the power of the Federal Court to consider making an order under new section 222 .

38.               The effect of item 15(2) is that a ground for disqualification can only be established by conduct that occurs after commencement of this Schedule.

Designated finding or contempt

39.               New subsection 223(1) provides that a ground for disqualification exists if a person has had a ‘designated finding’ made against them or has been found to be in contempt of court in relation to an order or injunction made under a designated law.

40.               Section 6, as amended, provides that a ‘designated finding’ has the meaning given to it by new section 9C. New section 9C defines a ‘designated finding’ as a finding:

·            in criminal proceedings that a person has committed an offence against a ‘designated law’; or

·            that a person has contravened, or been involved in a contravention, of a civil remedy or civil penalty provision of a ‘designated law’.

Wider criminal finding or contempt  

41.               New subsection 223(2) provides that a ground for disqualification exists if a ‘wider criminal finding’ has been made against a person or the person has been found to be in contempt of court under any law of the Commonwealth, a State or Territory (other than a designated law). Section 6, as amended, provides that ‘wider criminal finding’ has the meaning given to it by section 9C. Section 9C defines ‘wider criminal finding’ as a finding that a person has committed an offence against a law of the Commonwealth, a State or Territory.

42.               Significantly, this ground will only be established if the person engaged in the conduct to which the finding relates in the course of, or purportedly in the course of, performing functions in relation to an organisation.  In this way, findings which are committed in a purely private capacity will not be relevant.

43.               Ensuring compliance with all criminal laws and absence of contempt by officials is important for ensuring the effective and lawful management of registered organisations by law-abiding officials.

Multiple failures to prevent contraventions etc. by organisations

44.               New subsection 223(3) provides that a ground for disqualification applies in relation to a person if two of any of the following findings are made against an organisation whilst that person was an officer of that organisation:

·            a designated finding (new subparagraph 223(3)(a)(i)); or

·            a wider criminal finding (new subparagraph 223(3)(a)(ii)); or

·            the organisation was found to be in contempt of court under any law of the Commonwealth, a State or Territory (new subparagraph 223(3)(a)(iii));

and the person failed to take reasonable steps to prevent that conduct (new paragraph 223(3)(b)).

45.               The requisite threshold of two findings can be made up of any combination of findings in paragraph 223(3)(a). For example, the ground could be established by a single designated finding and a wider criminal finding.

46.               The Final Report recommended that this ground for disqualification from office be incorporated to reflect a similar ground for disqualifying a person from managing a corporation provided for in subsection 206E(1) of the Corporations Act. Like the comparable Corporations Act offence, the new ground for disqualification only applies where a person has failed to take reasonable steps to prevent the branch or organisation, of which they are an officer, from engaging in the relevant conduct.

Corporate impropriety

47.               New subsection 223(4) provides a ground for disqualification applies to a person if:

·            the person is found to have committed an offence under, or contravened a provision of,  Division 1 of Part 2D.1 of the Corporations Act (this Division concerns the general duties of officers of corporations); or

·            the person becomes disqualified from managing corporations under Part 2D.6 of the Corporations Act.

48.               The general duties of officers in a corporation, set out in Division 1, Part 2D.1 of the Corporations Act, mirror those in Division 2, Part 2 of Chapter 9 of the Act. Each of these Acts imposes duties on officers relating to an appropriate level of care and diligence, acting in good faith and not misusing their position of officer or information gained as a result of holding office. A finding that a person has previously contravened their duties as an officer in relation to a corporation may be indicative that the person is not a suitable person to hold office in an organisation or branch of an organisation.

49.               If a person has been disqualified from managing a corporation under Part 2D.6 of the Corporations Act, such disqualification should properly be a ground for disqualification of an official under this Part. This is because if a person has engaged in the types of conduct that form the grounds for disqualification under Part 2D.6 of the Corporations Act, suitability of the person to hold office in an organisation is also relevant.

Not fit and proper

50.               New subsection 223(5) provides that a ground for disqualification applies to a person if having regard to the matters set out under subsection 223(6) a person is not a fit and proper person to hold office in an organisation.

51.               New subsection 223(6) sets out the events relevant for the ground in new subsection 223(5). These are:

·            the person was refused an entry permit, or had an entry permit revoked or suspended, under Part 3-4 of the FW Act (new paragraph 223(6)(a));

·            the person was refused a WHS entry permit, or had a WHS entry permit revoked or suspended, under Part 7 of the Work Health and Safety Act 2011 (new paragraph 223(6)(b));

·            the person was refused an entry permit (however described), or had such a permit revoked or suspended, under a State or Territory OHS law within the meaning of the FW Act (new paragraph 223(6)(c));

·            in criminal or civil proceedings, or in enforcement action by an agency of the Commonwealth or a State or Territory against the person, the person was found to have engaged in conduct involving fraud, dishonesty, misrepresentation, concealment of material facts or a breach of duty (new paragraph 223(6)(d));

·            in criminal proceedings against the person, the person was found to have engaged in conduct involving the use of violence toward another person, the intentional causing of death or injury to another person or the intentional damaging or destruction of property (new paragraph 223(6)(e)); and

·            any other event the Court considers relevant (new paragraph 223(6)(f)).

52.               Currently, there is no capacity in the Act for a person to be disqualified from holding office in an organisation on the basis that they are not a fit and proper person to hold such a position. The Final Report specifically recommended that a person’s fitness and propriety be included as a ground for disqualification from office in light of the various case studies provided throughout the Final Report of continuing and unabated mismanagement by officers. The matters set out in new subsection 223(6) give content to the term ‘fit and proper’ by highlighting the types of conduct and behaviour that may indicate that a person is neither fit nor proper to hold office in an organisation. 

53.               The Final Report questioned whether a person who has been a denied an entry permit, or had such a permit suspended or revoked under the FW Act, the Work Health and Safety Act 2011 or a State or Territory occupational health and safety law, is an appropriate person to hold office in an organisation or branch of an organisation. The issuing of an entry permit under section 212 the FW Act is conditional upon a person being a fit and proper person and a person cannot hold an entry permit under the Work Health and Safety Act 2011 unless they have a permit issued under the FW Act. The denial, suspension or revocation of an entry permit, as described in new subsections 223(6)(a), (b) and (c), may be indicative that the person is not a suitable person to hold office in an organisation or branch of an organisation. This is because the right of entry provisions in the FW Act grant significant rights and privileges to permit holders to access premises and should only be exercisable by those who demonstrate appropriate regard for the law.

54.               Division 2, Part 2 of Chapter 9 of the Act places duties on officers including a duty to act with an appropriate level care and diligence, a duty to act in good faith and duties to not misuse the position of officer or misuse information gained as a result of holding office. A person who has been found in any relevant proceedings to have engaged in conduct involving fraud, dishonesty, misrepresentation, concealment of material facts or a breach of duty, in the circumstances described in paragraph 223(6)(d), may be a person who cannot uphold the duties of an officer and is thus not suitable to hold office in an organisation.

55.               A person who has been convicted of an offence involving the intentional use of violence toward another person, the intentional causing of death or injury to another person or the intentional damaging or destruction of property is automatically ineligible to be elected to, or hold, office under section 215. New paragraph 223(6)(e) will require the Federal Court to consider whether a person has ever been found in any criminal proceedings to have engaged such violent, damaging or destructive behaviour, whether or not a conviction was recorded, in order to determine if a person is a fit and proper person to hold office in an organisation. A finding in criminal or civil proceedings that a person has engaged in such behaviour may be indicative that the person is not a suitable person to hold office in an organisation due to the significant and important functions and powers that are exercisable by officers.

Division 4 - Offences in relation to standing for or holding office etc. while disqualified

56.               Item 6 also inserts new Division 4, Part 4 of Chapter 7 responding to recommendation 37 of the Final Report. Recommendation 37 was that the Act be amended to make it a criminal offence for a person disqualified from holding office to continue to hold office. It was recommended that the offence be one of strict liability.

Section 224 - Simplified outline of this Division

57.               New section 224 provides a simplified outline of Division 4, Part 4 of Chapter 7 and explains that the division provides for a criminal offence where a person, who has been disqualified from holding office, is a candidate for, holds, or acts as if the person holds office in an organisation or branch of an organisation or otherwise acts in a way that might influence the affairs of an organisation or branch.

Section 225 - Definition of ‘disqualified from holding office in an organisation’

58.               New section 225 provides that a person is ‘disqualified from holding office in an organisation’ if a person is:

·            not eligible to be a candidate for election to, or to hold, an office in an organisation or a branch of an organisation under subsection 215(1) (new paragraph 225(a)); or

·            disqualified from holding office in an organisation or branch of an organisation under section 28N or section 222 (new paragraph 225(b)).

59.               A person is not eligible to be a candidate for election to, or to hold, an office in an organisation or a branch of an organisation under subsection 215(1) if the person has been convicted, within the meaning of section 213, of one of the prescribed offences listed in section 212.

60.               New section 28N provides the Federal Court with jurisdiction to disqualify a person from holding office in an organisation where an application has been made to the Federal Court under new sections 28 or 28A seeking the cancellation of an organisation’s registration or alternative orders. The Federal Court can make an order under new section 28N where the Court determines that one of the grounds set out in in the application is established, subject to the conditions set out in new section 28M, the Court is satisfied that the ground was established wholly or mainly because of the conduct of officers. 

61.               The Federal Court can disqualify a person from holding office in an organisation or branch of an organisation under new section 222 where the Court is satisfied that one of the grounds for disqualification set out in new section 223 exists and the Court does not consider it would be unjust to disqualify the person.

Section 226 - Offences

62.               New section 226 provides that  a person commits an offence if the person is disqualified from holding office in an organisation or branch, as per section 225, and the person:

·            is a candidate for office in an organisation or branch of an organisation (new subsection 226(1));

·            continues to hold a position as an officer in an organisation or branch of an organisation (new subsection 226(2));

·            exercises the capacity to significantly affect the financial standing or other affairs of an organisation or branch (subparagraph 226(3)(b)(i)); or

·            gives directions to the committee of management of an organisation or branch, excluding advice given in a professional capacity, knowing the committee of management is accustomed to acting in accordance with the person’s wishes or intends that the committee of management will do so (subparagraph 226(3)(b)(ii)).

63.               The maximum penalty for each of these offences is 100 penalty units ($21,000), two years imprisonment, or both. Subsection 226(4) provides that for each of the offences in new section 226, where a person is disqualified as a result of an order made by the Court under either new section 28N or new section 222, strict liability will apply to that circumstance concerning whether or not the person was disqualified from holding office (the physical element).

64.               Section 206A of the Corporations Act, which provides the comparable offence for a person disqualified from managing a corporation to do so, similarly applies strict liability to the circumstance of whether or not a person is disqualified from holding office. Strict liability is appropriate in circumstances where the Federal Court has made an order disqualifying a person from holding office under new sections 28N or 222 in terms of providing a sufficient deterrent effect. Applying a fault element, whether intention, knowledge, recklessness or negligence, would unnecessarily weaken the deterrent effect of new sections 28N or 222. It is a matter of fact as to whether a person has been disqualified by order of the Federal Court and by virtue of such order, a person will be aware that they have been disqualified under those provisions. The defence of honest and reasonable mistake of fact is also available where the defendant has turned his or her mind to the existence of these facts (see section 9.2 of the Criminal Code).

65.               Strict liability does not apply to automatic disqualification under subsection 215(1), since there may be a question as to whether a person was aware of their automatic disqualification, in the absence of a Court order.

66.               Subsection 226(5) provides that new section 226 does not limit the Federal Court’s power to punish a person for contempt of Court.

Item 10 - Subsection 255E(2)

67.               Existing section 255E provides when the Commissioner can refuse to grant an application for registration as an auditor under section 255A of the Act. This item repeals and replaces existing subsection 255E(2) with a new subsection that reflects the amendment made to subsection 215(1) and the creation of a new power of disqualification to the Federal Court in new section 222.

68.               Existing subsection 255E(2) provides that the Commissioner must refuse a person’s application for registration as an auditor if the person:

·            is not eligible to be a candidate for election, or to be elected or appointed, to an office in an organisation under existing subsection 215(1); or

·            is disqualified from holding office under existing section 307A.

69.               Item 7 replaces subsection 255E(2) with a new subsection that simply provides that the Commissioner must refuse to register a person as an auditor under the Act if the person is disqualified from holding office in an organisation. This replacement subsection relies on the definition of ‘disqualified from holding office in an organisation or branch’ provided in new section 225.

Item 11 - Section 307A

70.               This item repeals existing section 307A which is no longer needed due to the new disqualification regime in section 222. The grounds for disqualifying a person from holding office under new section 222 provided in new subsection 223(3) include the ground in existing 307A of contravening a civil penalty provision of the Act.

Item 12 - At the end of subsection 308(1)

71.               Existing section 308 provides that the Federal Court may make such orders as the Court considers appropriate in all the circumstances of the case where a person has contravened a civil penalty provision of the Act.

72.               This item inserts a new note to subsection 308(1) providing that the Commissioner, the Minister, or a person with sufficient interest, may apply under new section 222 for an order disqualifying a person from holding office in an organisation. New subsection 223(3) provides a ground for disqualification under new section 222 where a person has contravened a civil penalty provision of the Act.

Item 13 - Paragraph 324(2)(g)

73.               Existing section 324 provides when the Minister may authorise financial assistance to certain persons under the Act. Paragraph 324(2)(g) allows a person who has made an application for a declaration under subsection 215(5) to apply to the Minister for financial assistance relating to that application.

74.               This item is consequential to the changes the Bill makes to section 215.  

Item 14 - Subsection 325(2)

75.               Subsection 325(2) provides for when the Federal Court may certify that an application made under subsection 215(5), for a declaration that a person was not eligible to be a candidate for office, not eligible to be elected or appointed to office or had ceased to hold office, was made reasonably.

76.               This item is consequential to the changes the Bill makes to section 215. 

Item 15 - Application of amendments

Definition of prescribed offence

77.               This item explains how the amendments to the disqualification regimes made by the Bill will apply upon commencement of the provisions of this Schedule.

78.               Subitem 15(1) provides that despite existing paragraph 213(a), which provides that a person is ‘convicted of a prescribed offence’ whether or not the conviction occurred prior to the commencement of Part 4 of Chapter 7, Part 4 will not apply to a conviction for an offence of the type listed in new paragraph 212(aa) unless the offence is a prescribed offence within the meaning of another paragraph of section 212 and the conviction occurred after the commencement of this Schedule.

Section 222 disqualification

79.               Subitem 15(2) provides for which conduct or events the Federal Court may consider when determining whether any of the grounds for disqualification under new section 223 are applicable to a person. The general effect of this subitem is that a ground for disqualification can only be established by conduct or events that occur after commencement of this Schedule.

·            For the purposes of the grounds set out in new subsections 223(1) and 223(2), concerning designated findings, wider criminal findings and contempt, the Federal Court may only consider conduct the person engaged in after the commencement of this Schedule and contempt relating to an order or injunction made after the commencement of this Schedule.

·            For the purposes of the ground set out in new subsections 223(3), concerning multiple findings made against an organisation, the Federal Court may only consider conduct the organisation engaged in after the commencement of this Schedule and contempt by the organisation relating to an order or injunction made after the commencement of this Schedule. Further, when considering whether the person failed to take steps to prevent the organisation’s conduct, the Court may only have regard to a failure to take reasonable steps after the commencement of this Schedule.

·            For the purposes of the ground set out in new subsections 223(4), concerning corporate impropriety, the Federal Court may only consider findings, or a disqualification, made in relation to conduct or an event occurring after the commencement of this Schedule.

·            For the purposes of the ground set out in new subsections 223(5), concerning whether the person is a fit and proper person to hold office, the Federal Court may only consider events that occurred after the commencement of this Schedule or findings made in relation to conduct that was engaged in after the commencement of this Schedule.

80.               The effect of subitem 15(3) is that once a ground for disqualification is established by reference to conduct or events that occurred after commencement of this Schedule, the Federal Court may have regard to matters that occurred prior to the commencement of this Schedule for the purposes of determining whether it would be unjust to disqualify the person from holding office (per new section 222(2)(b)(iii)).

Section 307A disqualification

81.               Subitem 15(4) provides that current section 307A will continue to have effect, allowing the Federal Court to disqualify a person from office in certain circumstances, after the commencement of this Schedule and in spite of the section’s repeal, in relation to relevant conduct that was engaged in prior to the commencement of this Schedule.

82.               Subitem 15(5) is a consequential amendment to subitem 15(4).

Commencement

83.               Subitem 15(6) clarifies that references to ‘commencement’ within Item 15 are references to the day on which this Schedule commences.

 



Schedule 2 - AMENDMENTS RELATING TO CANCELLATION OF rEGISTRATION AND ALTERNATIVE ORDERS

84.               Schedule 2 amends the Act to expand the grounds for, and streamline the regime in relation to, the cancellation of registration of registered organisations by the Federal Court. Provision is also made for the availability of alternative orders where a ground for cancellation has been made out because of the conduct of the officers or members of a particular part of an organisation.

Fair Work (Registered Organisations) Act 2009

Item 1- At the end of section 17

85.               This item amends the simplified outline of Chapter 2 of the Act in existing section 17 to provide that, under new Division 5, the Federal Court can make certain orders instead of cancelling the registration of an organisation. Alternative orders that can be made under new Division 5 include orders disqualifying certain officers from holding office, orders altering eligibility rules to exclude certain members from organisations and orders suspending the rights and privileges of the organisation and members.  

Item 2 - Subsections 19(4) and 20(2)

86.               This item is a consequential amendment to include references to ‘officers’ of an organisation. This amendment takes into account the provisions of the Bill that repeal and replace section 28 to provide that the actions of officers may provide a ground for an application to have an organisation’s registration cancelled.

Item 3 - Part 3 of Chapter 2 (heading)

87.               This item repeals and replaces the heading to Part 3 of Chapter 2. The heading will now read ‘Part 3 - Cancellation of registration and alternative orders’ to reflect the fact that the Part allows an applicant to seek orders other than the cancellation of an organisation’s registration.

Item 4 - Sections 28 and 29

88.               This item repeals current sections 28 and 29 and inserts new Divisions 1-7 of Part 3 of Chapter 2.

Division 1- Simplified Outline of this Part

Section 27A - Simplified outline of this Part

89.               New section 27A provides a simplified outline of Part 3 of Chapter 2.

 Division 2 - Applications to the Federal Court for orders under this Part

Section 28 - Application for cancellation of registration

90.               New section 28 provides that the Commissioner, the Minister, or a person with sufficient interest may apply to the Federal Court for an order cancelling the registration of an organisation on any of the grounds set out in new Division 3. The Commissioner will now have automatic standing to apply for the cancellation of an organisation’s registration. The current standing of the Minister is retained. An organisation (or other person) will also have standing if they are a person with a sufficient interest.

91.               ‘Sufficient interest’ has been interpreted as an interest beyond that of an ordinary person and includes those whose rights, interests or legitimate expectations would be affected by the decision.

Section 28A - Application for alternative orders

92.               New section 28A provides that the Commissioner, the Minister or a person with sufficient interest, may also apply to the Federal Court for one or more of the alternative orders set out in new Division 5 on any of the grounds contained in new Division 3.

93.               An application under new section 28A provides an alternative avenue for redress where a ground for cancellation in Division 3 is established because of the behaviour of officers or members in a particular part of an organisation, for example, a branch or division.

Section 28B - Multiple applications

94.               New section 28B makes it clear that a person can make an application for the cancellation of an organisation’s registration under new section 28 and an application for alternative orders under new section 28A at the same time. The Federal Court will be required to deal with those applications together.

Division 3 - Grounds for Federal Court orders

95.               The Division sets out the grounds for cancellation of an organisation’s registration. When a ground or grounds applies, it is still necessary for the Federal Court to determine whether cancellation of registration and/or or the imposition of alternative orders is just in the circumstances.

96.               Attention of the reader is drawn to item 11 (Application of amendments). The effect of item 11 is that a ground for deregistration can only be established by conduct that occur after commencement of this Schedule.

Section 28C - Ground—corrupt conduct of officers

97.               New section 28C provides a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where a substantial number of officers, or two or more senior officers, of an organisation, or part of an organisation, have:

·            engaged in conduct that involved, or was engaged in for the purposes of, abusing their position as officers (new paragraph 28C(1)(a)); or

·            engaged in conduct that perverted, or was engaged in for the purposes of perverting, the course of justice (new paragraph 28C(1)(b)); or

·            engaged in conduct that, having regard to their duties and powers as officers, involved, or was engaged in for the purposes of, corruption of any other kind (new paragraph 28C(1)(c)); or

·            acted in affairs of the organisation, or a part of the organisation, in their own interests rather than in the interests of the members of the organisation, or part, as a whole (new paragraph 28C(1)(d)); or

·            conducted affairs of the organisation, or part of the organisation, in a manner that is oppressive or unfairly prejudicial to, or unfairly discriminatory against, a member or a section or class of members, or in a manner that is contrary to the interests of the members of the organisation, or part, as a whole (new paragraph 28C(1)(e)).

98.               The indicia of corrupt conduct contained in new paragraphs 28C(1)(a)-28C(1)(c) are adapted from the definition of ‘engages in corrupt conduct’ in subsection 6(1) of the Law Enforcement Integrity Commission Act 2006 . New paragraphs 28C(1)(d) and 28C(1)(e) are adapted from paragraphs 461(1)(e) and 461(1)(f) of the Corporations Act which provide grounds on which a company may be wound up on the basis of the prejudicial manner in which directors are running the affairs of the company.

99.               Subsection 28C(2) provides that a finding of fact in proceedings before any court, relating to the grounds for cancelling registration or alternative orders set out in new section 28C, is admissible as prima facie evidence of that fact. This new subsection is an evidentiary provision to allow an applicant to use a finding of fact in another proceeding as evidence of that fact, unless the contrary is established. It is intended to expedite the application under new sections 28 or 28A where relevant factual findings have been made in other proceedings.

Section 28D - Ground—multiple findings against organisation

100.           New section 28D provides a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where two of either a ‘designated finding’ and a ‘wider criminal finding’, or two or more of either type of finding, have been made against the organisation. The terms ‘designated finding’ and ‘wider criminal finding’ are defined under amended section 6 and new section 9C (items 1 and 2 of Schedule 1).

Section 28E - Ground—serious offence committed by organisation

101.           New section 28E provides a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where the organisation is found, in criminal proceedings against it, to have committed an offence against a law of the Commonwealth or a State or Territory and the offence is punishable upon conviction by a penalty for a body corporate of (or equivalent to) at least 1,500 penalty units ($315,000). The threshold quantum of penalty units required establishes the gravity of the offence for a body corporate, which is equivalent to 5 years imprisonment for a natural person.

102.           The words ‘or equivalent to’ are necessary as not all States and Territories utilise the concept of penalty units and some instead express penalties as fixed amounts. In such a case where the fixed amount is equivalent to the monetary value of at least 1,500 penalty units, it will be sufficient to provide a ground for cancellation.

Section 28F - Ground—multiple findings against members

103.           New section 28F is adapted from current paragraph 28(1)(a)(ii) of the Act.

104.           New section 28F provides a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where designated findings have been made against a substantial number of the members of the organisation or the members of a part or class of the organisation. The term ‘designated finding’ is defined under amended section 6 and new section 9C (items 1 and 2 of Schedule 1).

Section 28G - Ground—non-compliance with orders or injunctions

105.           New section 28G is adapted from current paragraph 28(1)(d) of the Act.

106.           New section 28G provides a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where the organisation has failed to comply with an order or injunction made under a law of the Commonwealth, a State or Territory (paragraph 28G(1)(a)).

107.           New section 28G also provides a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where a substantial number of the members of the organisation, or a part or class of the organisation have failed to comply with an order or injunction made under a designated law. The term ‘designated law’ is defined under amended section 6 and new section 9C (items 1 and 2 of Schedule 1). 

108.           New subsection 28G(2) provides that where an application under new sections 28 or 28A is made on the ground in new section 28G, a finding in proceedings before any court that there has been a relevant failure to comply with court orders or injunctions is admissible as prima facie evidence. This new subsection is an evidentiary provision to allow an applicant to use a finding of fact in another proceeding as evidence of that fact, unless the contrary is established. It is intended to expedite the application under new sections 28 or 28A where relevant factual findings have been made in other proceedings.

Section 28H - Ground—obstructive industrial action

109.           New section 28H substantively replicates current paragraphs 28(1)(b) and (c) of the Act.

110.           New subsections 28H(1) and (2) provide a ground for cancelling an organisation’s registration under new section 28, or making an alternative order under new section 28A, where the organisation, or a substantial number of the members of the organisation or of a part or class of the organisation, have organised or engaged in unprotected industrial action (other than protected industrial action) that:

·            prevented, hindered or interfered with the activities of a federal system employer or the provision of any public service by the Commonwealth, a State or Territory or an authority of the Commonwealth, a State or Territory (new subparagraphs 28H(2)(a)(i) and (ii)); or

·            has had, is having, or is likely to have, a substantial adverse effect on the safety, health or welfare of the community or a part of the community (new paragraph 28H(2)(b)).

111.           The definition of ‘protected industrial action’ is set out in section 408 of the FW Act.

112.           New subsection 28H(3) provides that where an application under new sections 28 or 28A is made on the ground in new section 28H, a finding of fact in any court is admissible as prima facie evidence in the application under new sections 28 or 28A. This new subsection is an evidentiary provision to allow an applicant to use a finding of fact in another proceeding as evidence of that fact, unless the contrary is established. It is intended to expedite the application under new sections 28 or 28A where relevant factual findings have been made in other proceedings.

Section 28J - Application of grounds in relation to amalgamated organisations

113.           New subsection 28J(1) provides  that when considering whether a ground in new Division 3 exists in relation to an amalgamated organisation:

·            a reference to an ‘organisation’ includes any deregistered organisation in relation to the amalgamation (new paragraph 28J(1)(a));

·            a reference to an ‘officer’ of the organisation includes a person who was an officer of any deregistered organisation (new paragraph 28J(1)(b)); and

·            a reference to the conduct of an officer in relation to an organisation includes any conduct of the officer as an officer in relation to a de-registered organisation (new paragraph 28J(1)(c)).

114.           In relation to an amalgamated organisation, this provision ensures that where relevant conduct occurs after commencement of this Schedule so that a ground for cancellation is established, the Federal Court can consider the prior conduct of any deregistered organisation or its officers, for the purposes of determining whether it is unjust to make an order under Division 4 or Division 5 of Part 3 of Chapter 2 of the Act.

115.           New subsection 28J(2) explains that the definitions created for the purposes of Part 2 of Chapter 3 which deal with amalgamations, apply to any such terms used in new section 28J. 

Division 4 - Cancellation of registration of an organisation by the Federal Court

Section 28K - Order cancelling registration of an organisation

116.           New section 28K provides that, if an application is made for the cancellation of an organisation’s registration under new section 28, the Federal Court must cancel the registration of the organisation if:

·            the Court finds that one of the grounds set out in the application is established; and

·            the organisation concerned does not satisfy the Court that cancelling the organisation’s registration would be unjust having regard to:

o       the nature of the matters constituting the ground (new subparagraph 28K(1)(b)(i));

o       any action taken by or against the organisation, members or officers in relation to those matters (new subparagraph 28K(1)(b)(ii));

o       the best interests of the members of the organisation as a whole (new subparagraph 28K(1)(b)(iii)); and

o       any other matters the Court considers relevant (new subparagraph 28K(1)(b)(iv)).

117.           New subsection 28K(2) clarifies that the relevant organisation must be given the opportunity to be heard by the Federal Court when the Court is determining whether or not to cancel the organisation’s registration.

118.           Note 1 to new subsection 28K(1) draws the reader’s attention to the alternative orders the Court may make under new Division 5 in circumstances where a ground for cancellation is established but the organisation satisfies the Court that it would be unjust to cancel its registration.

119.           Note 2 to new subsection 28K(1) draws the reader’s attention to the effect of cancellation of registration as provided for under new Division 7.

Section 28L - Orders additional to cancelling registration under section 28K

120.           New section 28L is adapted from existing subsection 28(5) and provides that, where an order cancelling the registration of an organisation has been made under new section 28K the Court may also direct, by order, either or both of the following:

·            that any future application for registration under the Act by the former organisation not be dealt with before the end of a specified period (new paragraph 28L(a));

·            that any future application for the registration of an organisation with the same, or substantially the same, officers as those in the organisation that has had its registration cancelled, not be dealt with before the end of a specified period (new paragraph 28L(b)).

121.           Each of the grounds for cancelling an organisation’s registration set out in new Division 3 relates to an organisation that has ceased to function in the best interests of members as a whole. New section 28L is intended to ensure that the cancellation of an organisation’s registration is effective and is not undermined by the re-registration of the organisation or the registration of an organisation that has the same, or substantially the same, officers as those in the organisation that had its registration cancelled.

Division 5 - Alternative Federal Court orders

Section 28M - When the Federal Court may make alternative orders

122.           New section 28M provides that the Federal Court may make alternative orders (other than the cancellation of the registration of the organisation) under Division 5 if:

·            the Court finds that one of the grounds set out in Division 3 has been established in an application made under new sections 28 or 28A (new paragraph 28M(1)(a)); and

·            if the Court is considering an application made under new section 28, or an application made under new section 28A in conjunction with an order made under section 28, the relevant organisation has satisfied the Court that cancelling the organisation’s registration would be unjust (new paragraph 28M (1)(b)).

123.           The alternative orders that the Federal Court can make are:

·            disqualification of certain officers (new section 28N);

·            exclusion of certain members (new section 28P); and

·            suspension of rights, privilege and capacity (new section 28Q).

124.           New subsection 28M (2) provides that, before making an order under new sections 28N (disqualification of officers) or 28P (exclusion of certain members), or exercising power under new paragraph 28Q(1)(a) (suspension of rights, privileges or capacity) in relation to only part of an organisation or only some of its members, the Federal Court must be satisfied that the relevant ground was established wholly or mainly because of the conduct of:

·            officers of a particular part of the organisation (new subparagraph 28M(2)(a)(i)); or

·            members or class of members of a particular part of the organisation (new subparagraph 28M(2)(a)(ii).

125.           In addition, the Court must be satisfied that it would not be unjust to make the order or exercise the power, having regard to the circumstances and nature of the officers’ or members’ involvement in the matters constituting the ground and any other matters the Court considers relevant (new paragraph 28M(2)(b)).

126.           Subsection 28M(3) provides that, before exercising the power provided to the Federal Court under new paragraph 28Q(1)(a) (suspension of rights, privileges or capacity) in relation to the whole of an organisation or all of its members, the Court must be satisfied that exercising that power in that way would not be unjust having regard to the nature of the matters constituting the ground and any other matters the Court considers relevant.

127.           New subsection 28M(4) provides that the relevant organisation must be given the opportunity to be heard by the Federal Court when it is determining whether or not to make alternative orders.

Section 28N - Order—disqualification of certain officers

128.           New section 28N provides that the Federal Court may make an order disqualifying the officers mentioned in new subparagraph 28M(2)(a)(i) from holding office in an organisation, for a period the Court considers appropriate. An order under new section 28N is only available to the Court if it is satisfied of the relevant matters in new section 28M. 

129.           New subsection 28N(2) provides that if the Court does so, the officer is also disqualified from holding office in a branch of an organisation.

130.           New subsection 28N(3) provides that the Court must provide the Commissioner with a copy of any order disqualifying a person from office under new section 28N.

Section 28P - Order—exclusion of certain members

131.           New section 28P is adapted from existing subsection 28(4) of the Act.

132.           If the Federal Court is satisfied of the relevant matters in new section 28M, under new subsections 28P(1) and (2) it may make an order altering the eligibility rules of an organisation so as to exclude from eligibility for membership of the organisation persons belonging to the part of the organisation, or the class of members, mentioned in new subparagraph 28M(2)(a)(ii). The Federal Court can make an order excluding people belonging to such part of class of the membership despite any membership agreement made under existing section 151 of the Act.

133.           New subsection 28P(2) provides that if an order is made under new section 28P, the alteration of the rules of eligibility takes place on the date of the order or a date specified in the order.

134.           New subsection 28P(3) provides that where the Court makes an order under new section 28 it may make an additional order prohibiting an organisation, for a specified period of time, from seeking consent under section 158 of the Act to alter the organisation’s eligibility rules in such a manner as to have the effect of restoring eligibility to the persons who were the subject of the order under section 28P.

Section 28Q - Order—suspension of rights and privileges etc. and later reconsideration of question of cancellation or alternative orders

135.           New section 28Q is adapted from existing subsection 29(2) of the Act.

136.           If the Federal Court is satisfied of the relevant matters in new section 28M, it may under new section 28Q do any of the following:

·            make an order suspending the rights, privileges or capacities of the organisation or a part of the organisation, or of all or any of its members, as such members, under the Act, the FW Act or any other Act, under modern awards or orders made under this Act, the FW Act or any other Act, or under enterprise agreements (new paragraph 28Q(1)(a)); or

·            make orders providing directions as to the exercise of any rights, privileges or capacities that have been suspended (new paragraph 28Q(1)(b));

·            make orders that restrict the use of the funds or property of the organisation or a part of the organisation, and orders for the control of the funds or property for the purpose of ensuring observance of the restrictions (new paragraph 28Q(1)(c)).

137.           New subsection 28Q(2) provides that an order made under new section 28Q relating to the exercise of power will have effect despite anything in the rules of the organisation, or part of the organisation, concerned.

138.           Under new subsection 28Q(3), any orders made under new section 28Q relating to the exercise of power may either be:

·             revoked by an order from the Court upon the application of a party to the proceedings (new paragraph 28Q(3)(a)); or

·            will expire on the date specified in the order (new paragraph 28Q(3)(b)).

139.            New subsection 28Q(4) provides that the Federal Court must reconsider an application made under either or both of sections 28 (cancellation of registration) or 28A (alternative orders) once either:

·            any orders made under new section 28Q cease to be in force (new paragraph 28Q(4)(a)); or

·            one of the existing parties makes an application requesting that the Court consider whether it is just to determine the substantive issues in the application having regard to the evidence given in relation to compliance with any orders made under new section 28Q or any other relevant circumstances (new paragraph 28Q(4)(b)).

Division 6 - Cancellation of registration of an organisation by the FWC

140.           This item inserts a new heading to Division 6 and is consequential to the other amendments being made by this Schedule. The cancellation of registration of an organisation by the FWC is not affected by the amendments in this Schedule and continues unamended.  

Item 5 - At the end of section 30

141.           This item adds a note to section 30 to draw the reader’s attention to the fact that new Division 7 provides for the effects of cancelling the registration of an organisation.

Item 6 - Before section 31

Division 7 - Effect of cancellation of registration

142.           This item inserts new Division 7. The creation of this new Division is consequential to the other amendments being made by this Schedule and separates the effects of cancelling the registration of an organisation in new Divisions 1-5 concerning cancellation of registration by the Federal Court from Division 6 concerning cancellation by the FWC.

Item 7- Paragraph 158(10)(a)

143.           This item amends section 158, concerning changing the name or eligibility rules of an organisation, to ensure that it does not apply to an order made under new section 28P determining an alteration to the name or eligibility rules of an organisation.

Item 8 - Section 343

144.           This item amends section 343 so that the section now contains subsections. This amendment is necessary for the purposes of Item 9 which adds a new subsection to the end of existing section 343.

Item 9 - At the end of section 343

145.           This item inserts a new subsection 343(2) into section 343 to provide that the Minister is not able to delegate his or her power to make an application for:

·            the cancellation of the registration of an organisation or alternative orders under new sections 28 or 28A (new paragraphs 343(2)(a) and (b));

·            the disqualification of a person from office under new section 222 (inserted by Schedule 1) (new paragraph 343(2)(c)); or

·            a declaration made under new subsection 323(1) (inserted by Schedule 3) (new paragraph 343(2)(d)).

Item 10 - Paragraph 343B(2)(a)

146.           This item repeals paragraph 343B(2)(a) and substitutes new paragraph 343(2)(a) to reflect the fact that existing section 28 has been repealed and replaced by new sections 28 and 28A. Paragraph 343B(2)(a) provides that the Commissioner cannot delegate his or her power to make an application for the cancellation of the registration of an organisation or alternative orders under new sections 28 or 28A.

Item 11 - Application of amendments

147.           This item explains how the amendments to the Act made by Schedule 3 will apply upon commencement of this Schedule.

148.           In finding whether a ground for cancellation of registration of an organisation set out in an application under new section 28 or 28A is established, the Federal Court may only have regard to conduct engaged in after commencement (subitem (1)).

149.           However, once a ground has been established, the Court may have regard to matters occurring before or after commencement for the purposes of new subparagraphs 28K(1)(b)(iv) and 28M(2)(b)(ii), and new paragraph 28M(3)(b). These provisions give the Court the power to have regard to other matters it considers relevant in determining whether it is unjust to exercise its power under those sections (subitem (2)).

150.           Subitem (3) provides that, in relation to the application of sections 28 and 29 of the Act as in force immediately before commencement, these provisions continue in effect after commencement and, despite the amendments in Schedule 2, in relation to:

·            conduct engaged in before commencement (subitem (3)(a)); and

·            conduct engaged in before or after commencement in relation to an order or injunction made before commencement (subitem (3)(b)).

151.           Subitem (4) clarifies that for the purposes of the operation of sections 28 and 29 of the Act as continued in effect by sub-item (3), the amendments made by Schedule 2 are taken not to have been made.

152.           Subitem (5) defines the term ‘commencement’ for the purposes of item 11 to mean the start of the day item 11 commences.

 



Schedule 3 - AMENDMENTS RELATING TO ADMINISTRATION OF DYSFUNCTIONAL ORGANISATIONS ETC.

153.           Section 323 of the Act provides for applications to be made to the Federal Court for a declaration in relation to an organisation or any part of it. If a declaration is made, the Federal Court may approve a scheme for the taking of action to resolve the matters to which the declaration relates.

154.           Schedule 3 repeals section 323 and substitutes it with new Part 2A of Chapter 11. New part 2A expands current section 323 through three key amendments:

·            the standing for seeking a declaration and order for a scheme will be expanded to include the Commissioner and the Minister;

·            the categories of declarations in subsection 323(1) of the Act will be expanded; and

·            the Federal Court’s power to approve a scheme consequent to the making of a declaration will be amended to expressly permit the appointment of an administrator under a scheme and clearly set out the functions of an administrator.

155.           These amendments, modelled and adapted from broadly equivalent provisions of the Corporations Act, ensure that governance issues within an organisation, or individual branches or divisions, can be addressed promptly and transparently to ensure that the interests of members are protected.

Fair Work (Registered Organisations) Act 2009

Item 1 - Section 6

156.           This item amends section 6 to insert new definitions of ‘administrator’, ‘books’, ‘financial misconduct’ and ‘part’. The definition of ‘administrator’ includes any interim administrator appointed for the time being by the Federal Court under new subsection 323A(1). The definition of ‘financial misconduct’ is inclusively defined and includes misuse of funds and false accounting. Whether other conduct constitutes financial misconduct will turn on the facts of each case.  The definition of a part of an organisation follows current subsection 323(1)(a).

Item 2 - Subsection 280(6)

157.           This item repeals existing subsection 280(6), which contains a definition of ‘books’. This definition is currently limited to section 280 and will no longer be required because of the insertion of an identical definition in section 6 by item 1.

Item 3 - Section 317

158.           This item amends the simplified outline of Chapter 11 to include an outline of new Part 2A.

Item 4 - Section 323

159.           This item repeals existing section 323 and substitutes it with new Part 2A.

Section 323 - Declaration of dysfunction, misconduct etc. or vacancy in offices

160.           New subsection 323(1) gives standing to the following persons to seek a declaration or declarations from the Federal Court of the type set out in new subsection 323(3), if the applicant considers that circumstances mentioned in a paragraph of that subsection exist in relation to an organisation:

·            the Commissioner;

·            the Minister;

·            the organisation in relation to which the declaration is sought;

·            a member of the organisation in relation to which the declaration is sought; and

·            any other person having a sufficient interest in the organisation in relation to which the declaration is sought.

161.           New subsection 323(1) has expanded the standing in existing subsection 323(1) to include the Commissioner and the Minister. The issue of the Minister’s standing in terms of having a sufficient interest, was considered but not resolved in Brown v Health Services Union [2012] FCA 644 per Flick J at [51]. New paragraph 323(1)(b) addresses this uncertainty.

162.           ‘Sufficient interest’ has been interpreted as an interest beyond that of an ordinary person and includes those whose rights, interests of legitimate expectations would be affected by the decision.

163.           New subsection 323(2) enables the Federal Court to make the declaration if the Court is satisfied that the circumstances exist in relation to the organisation.

164.           New subsection 323(3) sets out the declarations the Federal Court may make: 

·            that an organisation or part of an organisation has ceased to function effectively and there are no effective means under the organisation or part’s rules by which the organisation or part can be reconstituted or enabled to function effectively (new paragraph 323(3)(a)) and is modelled on existing paragraph 323(1)(a) of the Act. New subsection 323(4) provides for a new inclusive definition of when an organisation or part of it has ceased to function effectively;

·            that one or more officers of an organisation or part of an organisation have engaged in financial misconduct in relation to carrying out of their functions or in relation to the organisation or part (new paragraph 323(3)(b)). An inclusive definition of financial misconduct is inserted into section 6 by item 1 of this Schedule;

·            that a substantial number of the officers of an organisation or part of an organisation have, in affairs of the organisation or part, acted in their own interests rather than in the interests of members of the organisation or part as a whole (new paragraph 323(3)(c)). New paragraph 323(3)(c) is adapted from paragraph 461(1)(e) of the Corporations Act;

·            that affairs of an organisation or part of an organisation are being conducted in a manner that is oppressive or unfairly prejudicial to, or unfairly discriminatory against, a member or members or in a manner that is contrary to the interests of the members of the organisation or part as a whole (new paragraph 323(3)(d)). New paragraph 323(3)(d) is adapted from paragraph 461(1)(f) of the Corporations Act;  and

·            that an office or position in an organisation or part of an organisation is vacant and there is no effective means under the organisation or part’s rules to fill the office or position (new paragraph 323(3)(e)). New paragraph 323(3)(e) reflects existing section 323(1)(b).

165.           New subsection 323(4) provides that for the purposes of new section 323, without limiting the circumstances in which an organisation or a part of an organisation ceases to function effectively, an organisation or a part of an organisation is taken to have ceased to function effectively if the Court is satisfied that officers of the organisation or a part of an organisation have:

·            on multiple occasions, contravened designated laws (new paragraph 323(4)(a)); or

·            misappropriated funds of the organisation or part (new paragraph 323(4)(b)); or

·            otherwise repeatedly failed to fulfil their duties as officers of the organisation or part of the organisation (new paragraph 323(4)(c)).

166.           The term ‘designated law’ is defined under amended section 6 and new section 9C (items 1 and 2 of Schedule 1). 

Section 323A - Federal Court may make certain orders if declaration made under section 323

167.           New section 323A sets out orders that the Federal Court may make if a declaration is made under new section 323.

168.           The Federal Court may, by order, approve a scheme for the taking of action by the organisation or part of an organisation, or by an officer or officers of the organisation, or part of the organisation, to resolve the circumstances set out in the declaration (new subsection 323A(1)). The power under new subsection 323(1) provides a broad remedial discretion.

169.           New subsection 323A(2) provides that, without limiting subsection 323A(1), a scheme ordered under new subsection 323A(1) may include the appointment of an administrator for the organisation or part of it, for reports to be given to the Court under the scheme, information about when the scheme begins and ends and when elections (if any) are to be held under the scheme.

170.           New subsection 323A(3) provides that the Court must not make an order under new section 323A unless it is satisfied that the order would not do substantial injustice to the organisation or any member of the organisation. This subsection reflects existing subsection 323(4).

171.           New subsection 323A(4) provides that if a scheme approved under new section 323A provides for its own end, the Court may only approve the scheme if the scheme provides that it does not end unless the Court is satisfied that the circumstances set out in the declaration have been resolved or no longer exist.

172.           New subsection 323A(5) provides that if a scheme approved under new section 323A involves provision for an election for an office, the Court must not approve the scheme unless the scheme provides for the election to be conducted by the Australian Electoral Commission and in accordance with Chapter 7.

173.           New subsection 323A(6) provides that if the Court makes an order approving a scheme, the Court may give any ancillary or consequential directions it considers appropriate, including but not limited to directions about the matters referred to in new subsection 323A(2). This subsection reflects existing subsection 323(3).

Section 323B - Federal Court order has effect despite rules

174.           New section 323B provides that an order or direction under new section 323A, and any action taken by an administrator or other person in accordance with the order or direction has effect despite anything in the organisation or part’s rules to which the order or direction relates and any previous order, direction or exemption made under the Act.

Section 323C - Elections while under administration

175.           New section 323C provides that any election for an office held while the organisation or any part of it is under administration must be conducted by the Australian Electoral Commission.

Section 323D - Administrators—conflict of interest

176.           New section 323D provides that within 21 days after an administrator acquires any interest, pecuniary or otherwise, that could conflict with the proper performance of his or her duties, or becomes aware that any interest, pecuniary or otherwise, that he or she has or is likely to acquire, could conflict with the proper performance of his or her duties, the administrator must notify the Federal Court in writing of that interest.

177.           New section 323D is broadly modelled on section 436DA of the Corporations Act, which requires a voluntary administrator to report to creditors and the Australian Securities and Investments Commission on their independence by declaring relevant relationships and indemnities.

Section 323E - Administrators—termination of appointment

178.           New section 323E provides that the Federal Court may terminate the appointment of an administrator at any time. This includes, but is not limited to, if the administrator has a conflict of interest and has notified the Court of that conflict under new section 323D.

Section 323F - Functions of administrator

179.           New section 323F sets out the functions of an administrator appointed under a scheme in new section 323A. New section 323F is modelled on section 437A of the Corporations Act.

Section 323G - Officers etc. to help administrator

180.           New section 323G imposes obligations on certain persons to assist an administrator. New subsections 323G(1) to (4) are modelled on similar obligations in section 438B of the Corporations Act.

181.           New subsections 323G(1) and (2) provide that officers and employees of an organisation or part of an organisation under administration, or a person who ceased to be an officer of an organisation or part because of or following the appointment of an administrator, must attend on the administrator at such times and give the administrator such information about the organisation or part’s business, property, affairs and financial circumstances as the administrator reasonably requires.

182.           New subsection 323G(3) creates an offence of strict liability if the person does not comply with an administrator’s reasonable request under new subsection 323G(2). As this offence is strict liability it will not be necessary to establish the person’s state of mind, but the defence of honest and reasonable mistake will apply (see section 9.2 of the Criminal Code). The penalty is imprisonment for 12 months or 50 penalty units, or both.

183.           New subsection 323G(4) provides that the offence in new subsection 323G(3) does not apply if a person has a reasonable excuse.

184.           New subsection 323G(5) makes it clear that that the privilege against self-incrimination is a reasonable excuse under new subsection 323G(4). New subsection 323G(6) also provides that new section 323G does not affect the law relating to legal professional privilege.

185.           The offence in new section 323G and the level of penalty is modelled on the similar obligation in section 438B of the Corporations Act. The similarities between the regulation of the corporate governance of companies and registered organisations justifies the imposition of strict liability and a penalty of imprisonment. The strict liability elements of the offence in new section 323G are clear and straightforward. The strict liability nature of the offence will also ensure the integrity and effectiveness of the regulatory regime to optimise the opportunity for remedial administration of dysfunctional organisations.

186.           The inclusion of the reasonable excuse defence ensures consistency with the Corporations Act.  

Section 323H - Right to organisation’s books

187.           New section 323H gives an administrator a right to an organisation’s books. This section is modelled on section 438C of the Corporations Act.

188.           New subsection 323H(1) prevents a person from retaining possession of the books of an organisation or part of an organisation or claiming or enforcing a lien on the books of an organisation or part of an organisation, however, such a lien is not otherwise prejudiced. 

189.           New subsection 323H(2) preserves a secured creditor’s right of possession over books (other than because of a lien) but provides that an administrator is entitled to inspect, and make copies of, such books at any reasonable time.

190.           New subsection 323H(3) permits an administrator to give written notice to a person requiring the person to deliver to the administrator books that are in the person’s possession. The written notice must specify the books that are in the person’s possession to be delivered to the administrator.

191.           The compliance period for a notice given under new subsection 323H(3) must be at least 3 business days and this must be specified in the notice (new subsection 323H(4)).

192.           New subsection 323H(5) creates an offence of strict liability if a person does not comply with a notice under new subsection 323H(3). As this offence is strict liability it will not be necessary to establish the person’s state of mind (see section 6.1 of the Criminal Code), but the defence of honest and reasonable mistake will apply (see section 9.2 of the Criminal Code). The penalty is 12 months’ imprisonment or 50 penalty units, or both.

193.           New subsection 323H(6) provides that new subsection 323H(5) does not apply to the extent that the person is entitled to retain possession of the books. Subsection (6) also contains a note identifying the relevant provision in the Criminal Code that deals with the evidential burden that a defendant bears in relation to the matter in subsection (6).

194.           The offence in new section 323H and the level of penalty is modelled on the similar obligation in section 438C of the Corporations Act. The similarities between the regulation of the corporate governance of companies and registered organisations justifies the imposition of strict liability and a penalty of imprisonment. The strict liability elements of the offence in new section 323H are clear and straightforward. The strict liability nature of the offence will also ensure the integrity and effectiveness of the regulatory regime to optimise the opportunity for remedial administration of dysfunctional organisations.

195.           The inclusion of the reasonable excuse defence ensures consistency with the Corporations Act.  

Section 323J - Remuneration determinations

196.           New section 323J gives the Federal Court discretion to make any orders it considers appropriate to provide for an administrator’s remuneration.

197.           If the Court makes an order providing for remuneration of an administrator, new section 323J sets out the process for determining an administrator’s remuneration. This section is modelled on the process for Court approval of an administrator’s remuneration under Division 60 of Schedule 2 of the Corporations Act.

Section 443K - Administrator not to be sued

198.           New section 443K excludes an administrator appointed under new section 323A, or a person acting under the direction of an administrator, from liability for acts or omissions done in good faith in the performance or exercise, or purported performance or exercise, of any function or power of the administrator.

Item 5 - Paragraph 324(2)(p)

199.           This item amends paragraph 324(2)(p) to preserve the right of persons to apply to the Minister for financial assistance where they are a party to a proceeding under new Part 2A.

Item 6 - After paragraph 343B(2)(h)

200.           This item amends subsection 343B(2) to insert new paragraph 343B(2)(ha), which provides that the Commissioner’s standing to seek a declaration under new subsection 323(1) is not delegable.

 



Schedule 4 - AMENDMENTS RELATING TO A PUBLIC INTEREST TEST FOR AMALGAMATIONS

201.           Part 2 of Chapter 3 of the Act provides the procedure for the amalgamation of two or more organisations. The existing regulatory framework does not require the FWC to decide whether an amalgamation is in the public interest when considering the amalgamation of two or more organisations.

202.           Currently, the FWC need only be satisfied of matters contained in subsection 73(2) of the Act before fixing an amalgamation day. That is, the FWC must ensure that valid ballot proceedings on the question of amalgamation have been conducted, there are no proceedings (other than civil proceedings) pending against an existing organisation that is seeking to amalgamate, and that the newly amalgamated organisation will assume all legal responsibilities and liabilities that arise from an existing organisation.

203.           Schedule 4 will amend the Act to empower the FWC with more effective oversight over the amalgamation process in order to reduce the risk of an adverse effect of an amalgamation of existing organisations on the Australian economy, including relevant industrial sectors, the organisations’ members and other relevant persons.

204.           The new provisions will require the FWC to consider whether a proposed amalgamation is in the public interest, before fixing an amalgamation day. 

205.           The new provisions supplement and do not override the existing amalgamation provisions contained in Part 2 of Chapter 3 of the Act.

206.           Schedule 4 will amend the Act to:

·            empower the FWC to decide whether an amalgamation is in the public interest with reference to the record of the organisations and their officials in complying with the law, as well as other relevant matters including the likely impact of the amalgamation on the industry or industries concerned and the Australian economy and any important part of it;

·            include a broad list of relevant persons who are allowed to make submissions to the FWC on whether an amalgamation is in the public interest;

·            require the FWC to fix an appropriate time and place to give consideration to whether an amalgamation is in the public interest, and to give sufficient notice to the existing organisations and relevant persons; and

·            provide that an amalgamation does not take effect if the FWC decides that it is not in the public interest.

Fair Work (Registered Organisations) Act 2009

Item 1 - Section 6

207.           Item 1 amends section 6 to add a cross-reference to the definition of the term ‘compliance record event’ in new section 72E.

Item 2 - Section 34

Item 3 - Section 34

208.           Items 2 and 3 amend the simplified outline of Chapter 3 in section 34 to take account of the amendments made by this Schedule.

Item 4 - Section 37

Section 37 - Exercise of the FWC’s powers under this Part

209.           Item 4 repeals and substitutes existing section 37. New subsection 37(1) provides that the powers of the FWC under Part 2 of Chapter 3, except in relation to the public interest test for amalgamations, are exercisable only by a Presidential Member of the FWC. New subsection 37(2) provides that the public interest test for amalgamations function of the FWC is exercisable only by a Full Bench of the FWC.

210.           One effect of this requirement is that a decision of a Full Bench on the question of the public interest is not subject to merits review. The intent is not to restrict the right of organisations affected by a decision to fair decision-making about whether an amalgamation is in the public interest. Rather, the requirement for a Full Bench protects the integrity of the decision-making process by ensuring that a decision on the question of an amalgamation is made by a number of senior members of the FWC.

211.           This would not be a new exclusion from merits review, rather, decisions on the public interest test for amalgamations would simply fall into the existing exclusion from merits review that applies to all decisions of the Full Bench of the FWC under the Act and the FW Act.

212.           Item 4 does not exclude a right of judicial review to the Federal Court or High Court. Decisions by the Full Bench of the FWC are reviewable by the High Court under section 75(v) of the Constitution or the Federal Court under section 39B of the Judiciary Act 1903 .

Item 5 - Subsection 56(1)

213.           Item 5 is a consequential amendment to the amendments in this Schedule providing for a public interest test for amalgamations. It amends subsection 56(1) to note the exception to the section 56 objections provision for objections provided for by the public interest test amendments.

Item 6 - At the end of section 67

214.           Item 6 is a consequential amendment to the amendments in this Schedule providing for a public interest test for amalgamations. It adds new subsection 67(4) to provide that subsection 67(2) does not authorise the FWC to dispense with the public interest test for amalgamations when making orders in relation to a further ballot if an amalgamation is not approved in a ballot.

Item 7 - Before section 73

215.           Item 7 inserts new Subdivision A, ‘Public interest test for amalgamations’, comprising new sections 72A-72F, and the new title Subdivision B, ‘Amalgamation taking effect’, for the remaining provisions of the Part, into Part 2 of Chapter 3.

Subdivision A - Public interest test for amalgamations

Section 72A - Decision whether amalgamation is in public interest

216.           New subsection 72A(1) requires the FWC to decide whether an amalgamation is in the public interest before fixing a day for amalgamation under section 73.

217.           New subsection 72A(1) requires the FWC to consider the matters mentioned in new section 72D to decide if an amalgamation is in the public interest.  

218.           The FWC must decide that an amalgamation is in the public interest for the amalgamation to take effect, as made clear in new section 72F. In practice, this means that a decision of the FWC under new section 72A will determine whether an amalgamation can proceed under section 73.

219.           New subsection 72A(2) provides that the FWC can decide whether an amalgamation is in the public interest at any time after an application for amalgamation is lodged with the FWC under sections 43 or 44.

Section  72B - Hearings about public interest

220.           New section 72B requires the FWC to take certain steps in relation to hearings about whether an amalgamation is in the public interest.

221.           The FWC must first:

·            fix a time and place for hearing submissions in relation to the matters mentioned in subsection 72D(1), which relates to organisations’ record of compliance with the law (new paragraph 72B(1)(a));

·            promptly notify the existing organisations concerned in the amalgamation of the time and place of the hearing (new paragraph 72B(1)(b)); and

·            promptly publish a notice on the FWC website, or in any other way the FWC considers appropriate, of the hearing details (new paragraph 72B(1)(c)).

222.           This last requirement is for the benefit of persons who are not expressly notified.

223.           If the matter is not concluded under subsection 72D(2), the FWC must:

·            fix a time and place for hearing submissions in relation to whether the amalgamation is otherwise in the public interest (new paragraph 72B(2)(a));

·            promptly notify the existing organisations concerned in the amalgamation of the time and place of the hearing (new paragraph 72B(2)(b)); and

·            promptly publish a notice on the FWC website, or in any other way the FWC considers appropriate, of the hearing details (new paragraph 72B(2)(c)).

224.           This last requirement is for the benefit of persons who are not expressly notified.

Section 72C - Persons who may make submissions about public interest

225.           New section 72C provides for persons who can make submissions in relation to the matters mentioned in subsection 72D(1) concerning the organisations’ record of compliance with the law and whether the amalgamation is otherwise in the public interest. The FWC is required to have regard to those submissions (new subsection 72C(2)).

226.           Submissions about the matters relevant to whether an amalgamation is in the public interest can be made by:

·            the existing organisations (new paragraph 72C(1)(a));

·            other organisations that represent the industrial interests of employers or employees in the industry or industries concerned or that may otherwise be affected by the proposed amalgamation (new paragraph 72C(1)(b));

·            bodies, other than organisations, that represent the industrial interests of employers or employees in the industry or industries concerned (new paragraph 72C(1)(c));

·            the Commissioner (new paragraph 72C(1)(d));

·            the Minister (new paragraph 72C(1)(e));

·            a Minister of a referring State or Territory with responsibility for workplace relations (new paragraph 72C(1)(f)); and

·            any other person with a ‘sufficient interest’ in the amalgamation (new paragraph 72C(1)(g)).

227.            ‘Sufficient interest’ has been interpreted as an interest beyond that of an ordinary person and includes those whose rights, interests or legitimate expectations would be affected by the decision.

Section 72D - Matters to which the FWC must have regard

228.           New section 72D lists the matters the FWC must have regard to in deciding whether an amalgamation is in the public interest. The FWC may also have regard to other matters it considers relevant.

Record of compliance with the law

229.           In deciding whether the amalgamation is in the public interest, the FWC must have regard to any compliance record events within the meaning of new section 72E that have occurred for each of the existing organisations (subsection 72D(1)).

230.           New subsection 72D(2) provides that if the FWC considers, having regard to the incidence and age of compliance record events for each existing organisation, that the organisation has a record of not complying with the law, the FWC must decide under new section 72A that an amalgamation is not in the public interest.

Other matters of public interest

231.           New subsection 72D(3) requires that if the public interest consideration is not concluded under new subsection 72D(2), the FWC must, in deciding whether the amalgamation is otherwise in the public interest, have regard to the impact the amalgamation is likely to have on:

·            employees in the industry or industries concerned (new paragraph 72D(3)(c)); and

·            employers in the industry or industries concerned (new paragraph 72D(3)(d)).

232.           Subsection 72D(4) makes it clear that the FWC may have regard to other matters it considers relevant when determining whether the amalgamation is in the public interest. Other relevant matters could include the likely impact upon the industry or industries concerned or the economy or an important part of it.

Section 72E - Compliance record events

233.           New section 72E provides for when a compliance record event occurs for an organisation.

234.           In relation to compliance record events involving an organisation or members, these are defined by new subsection 72E(1) to be:

·            designated findings or wider criminal findings against the organisation (new paragraph 72E(1)(a)). ‘Designated finding’ is defined by new subsection 9C(1) inserted by item 2 of Schedule 1 to this Bill;

·            findings of contempt of court against the organisation relating to an order or injunction (new paragraph 72E(1)(b));

·            where the organisation, part of the organisation or a class of members of the organisation organised or engaged in ‘obstructive industrial action’ as defined by new subsection 28H(2) inserted by item 4 of Schedule 2 to this Bill (new paragraph 72E(1)(c)).

235.           In relation to compliance record events involving officers, these are defined by new subsection 72E(2) to be:

·            designated findings, as defined by new subsection 9C(1) inserted by item 2 of Schedule 1 to the Bill, against a person who was an officer of the organisation at the time of the conduct to which the finding relates (new paragraph 72E(2)(a));

·            wider criminal findings against a person if the person was an officer of the organisation at the time of the conduct to which the finding relates and the conduct was in the course of, or purportedly in the course of, performing functions in relation to the organisation (new paragraph 72E(2)(b));

·            findings of contempt of court against a person in relation to an order or injunction if the person was an officer of the organisation at the time of the conduct to which the finding relates and the conduct was in the course of, or purportedly in the course of, performing functions in relation to the organisation (new paragraph 72E(2)(c));

·            a person’s disqualification from holding office in an organisation while the person was an officer in the organisation (new paragraph 72E(2)(d)). 

236.           As a consequence of the definition of ‘office’ in section 9 and the definition of ‘officer’ in section 6, references to officers of an organisation include officers of branches of organisations. This means, for example, that a finding that an officer of a particular branch of an organisation organised or engaged in obstructive industrial action is a compliance record event relevant to the FWC’s overall decision about an organisation’s compliance record. 

Section 72F - Amalgamation not in public interest does not take effect

237.           New subsection 72F(1) provides that the FWC is prohibited from fixing an amalgamation day and the amalgamation does not take effect if the FWC decides it is not in the public interest.

238.           New subsection 72F(2) clarifies that if the FWC decides under new section 72A that an amalgamation is not in the public interest at any time before the FWC approves the submission of the amalgamation to ballot, the FWC must not approve a ballot to be held on the question of amalgamation despite any other provision of Part 2 of Chapter 3.

Subdivision B - Amalgamation taking effect

239.           Item 7 also inserts the new title ‘Subdivision B - Amalgamation taking effect’ before section 73.

Item 8 - Subsection 73(1)

Item 9 - Subsection 73(2)

240.           Items 8 and 9 are consequential amendments to the amendments in this Schedule providing for a public interest test for amalgamations. They amend subsections 73(1) and (2) to reinforce that an amalgamation is contingent on the FWC deciding that it is in the public interest.

Item 10 - Paragraph 73(2)(c)

241.           Item 10 repeals and substitutes paragraph 73(2)(c) to provide that the FWC is to be satisfied that there are no proceedings of the kind mentioned in new subsection 73(2A), inserted by item 12, pending against any of the existing organisations concerned in the amalgamation, before fixing an amalgamation day.

Item 11 - At the end of subsection 73(2)

242.           Item 11 inserts a new note at the end of subsection 73(2) to clarify that, notwithstanding subsection 73(1), an amalgamation does not take effect if the FWC decides that it is not in the public interest.

Item 12 - After subsection 73(2)

243.           Item 12 inserts new subsection 73(2A) to define the kinds of proceedings relevant to new paragraph 73(2)(c). These are:

·            criminal proceedings in relation to a contravention of the Act, the FW Act or any other law of the Commonwealth (new subparagraph 73(2A)(a)(i));

·            criminal proceedings in relation to a breach of an order made under the Act, the FW Act or any other law of the Commonwealth (new subparagraph 73(2A)(a)(ii)); and

·            civil proceedings for a contravention of a provision mentioned in a subparagraph of paragraph (b) of the definition of ‘designated finding’ in new subsection 9C(1) inserted by item 2 of Schedule 1 to this Bill.

244.           The amendments made by item 12 are required to clarify the scope of pending proceedings against organisations which the FWC is satisfied of in determining whether to fix an amalgamation day.

245.           Existing paragraph 73(2)(c) is not internally consistent because it incorrectly suggests that proceedings for breaches of modern awards or enterprise agreements can be the subject of criminal proceedings. This reflects earlier law under which a breach of an award could amount to a criminal offence, but is no longer the case. However, the contravention of an FWC order may be an offence (s 675 of the FW Act).  

246.           New subsection 73(2A) will correct this and make clear which pending proceedings are relevant to the FWC’s consideration of whether to fix an amalgamation day. These are:

·            criminal proceedings for contravention of the Act, the FW Act or any other Commonwealth law or a breach of an order made under the Act, the FW Act or any other Commonwealth law (new paragraph 73(2A(a)); and

·            civil proceedings for contravention of a provision mentioned in subparagraph (b) of the definition of designated finding in new subsection 9C(1) inserted by item 2 of Schedule 1 to this Bill.

Item 13 - Application of amendments

247.           Item 13 clarifies that the FWC must consider whether an amalgamation is in the public interest for all proposed amalgamations, if, on the commencement day of this item, an amalgamation day has not been fixed under section 73, regardless of whether the application was made under subsections 43 or 44 of the Act before the commencement day of this item.

248.           Item 13 also provides that a reference in the Act to a compliance record event includes an event that occurred before this item commences.

 

 

 



Schedule 5 - MINOR AND TECHNICAL AMENDMENTS

249.           Schedule 5 makes minor and technical amendments to the Act.

Fair Work (Registered Organisations) Act 2009

Item 1 - Section 6 (the definition of Australian Accounting Standards )

250.           This item updates the definition of ‘Australian Accounting Standards’ on the basis that the accounting bodies no longer have responsibility for setting accounting standards.

251.           The ability for the Regulations to modify the standards is not new and is adapted from the previous provision and is consistent with section 253.

Item 2 - Section 6 (the definition of Australian Auditing Standards )

252.           This item updates the definition of ‘Australian Auditing Standards’ on the basis that the accounting bodies no longer have responsibility for setting auditing standards.

253.           The ability for the Regulations to modify the standards is not new and is adapted from the previous provision and consistent with section 253.

Item 3 - Section 6 (paragraph (d) of the definition of authorised official )

254.           This item updates paragraph (d) of the definition of ‘authorised official’ to refer to the Australian Building and Construction Commissioner. This amendment reflects the passage of the Building and Construction Industry (Improving Productivity) Act 2016 .

Item 4 - Subdivision BB of Division 4 of Part 2 of Chapter 5 (heading)

255.           This item repeals the redundant heading ‘Subdivision BB of Division 4 of Part 2 of Chapter 5’.

Item 5 - Subsection 329FA(1) (note)

256.           This item replaces the note to subsection 329FA(1) to update the reference to the Legislative Instruments Act 2003 to the Legislation Act 2003 following the passage of the Acts and Instruments (Framework Reform) Act 2015 .

Item 6 - Subparagraph 337A(1)(b)(iii)

257.           This item omits the reference to ‘subsection 15(1) of the Building and Construction Industry (Improving Productivity) Act 2016 ’, in relation to the Australian Building and Construction Commissioner, to ensure consistent terminology across the Act.

Item 7 - Subparagraph 337A(1)(b)(iiia)

258.           This item omits the reference to ‘subsection 15(2) of the Building and Construction Industry (Improving Productivity) Act 2016 ’, in relation to a Deputy Australian Building and Construction Commissioner, following the passage of the Building and Construction Industry (Improving Productivity) Act 2016 ’.

Item 8 - Paragraph 337BB(4)(d)

259.           This item updates paragraph 337BB(4)(d) in relation to persons who may apply for a civil remedy for protected disclosure reprisal action to refer to the Australian Building and Construction Commissioner. This amendment reflects the passage of the Building and Construction Industry (Improving Productivity) Act 2016 .

Item 9 - Subsection 337C(1)

260.           This item corrects the reference to subsection 337A(4) in subsection 337C(1) with a reference to subsection 337A(3), being the provision by which disclosures to lawyers qualify for protection under the protected disclosure provisions.

Item 10 - Paragraph 343A(2)(b)

Item 11 - Paragraph 343A(3)(aa)

261.           These amendments remove the references to section 154C, relating to approval of financial training, in the lists of the General Manager’s delegable functions, following the repeal of section 154C by the Amendment Act.

Item 12 - Subsection 343B(2A)

262.           This amendment adds the Commissioner’s functions or powers in relation to financial training to those functions or powers delegable to a senior executive employee or acting senior executive employee who is a member of the staff assisting the Commissioner. 




[1] Committee on Economic, Social and Cultural Rights, General Comment No. 18: The Right to Work (E/C.12/GC/18), p 5.

[2] ILO, Freedom of Association: Digest of decisions and principles of the Freedom of Association Committee of the Governing Body of the ILO Geneva , Fifth (revised) Edition, 2006, para 369.

[3] Final Report of the Royal Commission into Trade Union Governance and Corruption, Volume 5, Chapter 3, para 188.

[4] Final Report of the Royal Commission into Trade Union Governance and Corruption, Volume 5, Chapter 8, para 35.

[5] Final Report of the Royal Commission into Trade Union Governance and Corruption, Volume 5, Chapter 3, para 171 and recommendation 37.

[6] Final Report of the Royal Commission into Trade Union Governance and Corruption, Volume 5, Chapter 3, para 190.