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  1. Industrial Law Law Extension Committee Winter 2010

  2. 2. Workplace Relations System

  3. Conciliation and arbitration power Section 51(xxxv): “Conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one state.”

  4. Conciliation and arbitration power Features: • Cannot legislate directly for terms and conditions of employment; • Permits establishment of a process – conciliation and arbitration; • Only for the prevention or settlement of industrial disputes; • Only industrial disputes extending beyond the limits of any one state.

  5. New South Wales v Commonwealth[2006] HCA 52: Kirby J (at [434]): “If s 51(xx) of the Constitution now provides a legitimate source federal law with respect to industrial disputes, by inference it always did. All those hard-fought decisions of this Court and the earnest presentation of cases, the advocacy and the judicial analysis and elaboration within them concerning the ambit of s 51(xxxv) of the Constitution were (virtually without exception) a complete waste of the Court’s time and energies.”

  6. Corporations power Section 51(xx): “Foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth.”

  7. Constitutional corporation R v Federal Court; Ex parte WA Football League (1979) 143 CLR 190: “… for constitutional purposes a corporation will satisfy the description ‘trading corporation’ if trading is a substantial corporate activity. Once it is found that trading is a substantial and not a merely peripheral activity, the conclusion that the corporation is a trading corporation is open.”

  8. New South Wales v Commonwealth (2006) 299 CLR 1: A law will be valid under s 51(xx) so long as it either (at [198]): • The law singles out constitutional corporations as the object of statutory command (eg. a corporation shall or shall not … ); or • The law is directed at protecting constitutional corporations from conduct intended or likely to cause loss or damage to the corporation.

  9. Other heads of power • Trade and commerce power (s 51(i)); • Taxation power (s 51(ii)); • Defence power (s 51(vi)); • External affairs (s 51 (xxix)); • Commonwealth employees power (s 52(i)); • Territories power (s 122).

  10. Who does the Federal system apply to? Section 13 defines an “national system employee”: A national system employee is an individual so far as he or she is employed, or usually employed, as described in the definition of national system employer in section 14, by a national system employer, except on a vocational placement.

  11. Who does the Federal system apply to? Section 14 defines an “national system employer”: • a constitutional corporation; • the Commonwealth or a Commonwealth authority; • a person or entity who employs an individual as a flight crew officer, a maritime employee or a waterside worker; or • a body corporate incorporated in a Territory; • a person or entity that carries on an activity in a Territory in Australia, so far as the person or entity employs, or usually employs, an individual in connection with the activity carried on in the Territory.

  12. Referral of powers The Industrial Relations (Commonwealth Powers) Act 2009 (NSW) referred to Commonwealth powers with respect to terms and conditions of employment or rights and responsibilities of employers, employees or association (s 5). Excludes state public sector employees, law enforcement officers and local government sector employees (s 6).

  13. Referral of powers (cont) Reference excludes: Superannuation, workers compensation and occupational health and safety; Outworkers and child labour; Training arrangements; Long service leave, victims of crime leave, jury service; Essential services in an emergency; Employee and employer associations; Workplace surveillance and trading hours; Enforcement of contract of employment.

  14. Federal/state balance FWA, s26 Act excludes some State and Territory laws      (1)  This Act is intended to apply to the exclusion of all State or Territory industrial laws so far as they would otherwise apply in relation to a national system employee or a national system employer. A State or Territory industrial law includes: • A general State industrial law, including the Industrial Relations Act 1996 (NSW); • An Act of a State or Territory that applies to employment generally or dealing with leave; • Laws providing for equal remuneration, unfair employment contracts or union right of entry; • An instrument made under such a law.

  15. Exceptions – s 27 • Discrimination laws; • Superannuation; • Workers compensation; • Occupational health and safety; • Outworkers and child labour; • Long service leave; • Leave of victims of crime and jury service; • Public holidays; • Provision of essential services in an emergency; • Regulation of industrial organisations; • Workplace surveillance; • Business trading hours; • Enforcement of employment contracts.

  16. Federal institutions • Fair Work Australia (FWA); • Fair Work Ombudsman; • Fair Work Inspectors; • Fair Work Division of the Federal Court and Federal Magistrate’s Court.

  17. National Employment Standards (NES) Minimum standards for: • Maximum weekly hours; • Requests for flexible working arrangements; • Parental leave, including maternity, paternity and adoption leave; • Annual leave; • Personal/carer’s leave and compassionate leave;

  18. NES (cont.) Community service leave; Long service leave; Public holidays; Notice of termination and redundancy pay; Fair Work Information Statement.

  19. Maximum weekly hours (s 62) An employer must not request or require an employee to work more than 38 hours per week unless the additional hours are reasonable. Whether hours are reasonable is assessed taking into account any risk to health and safety, the employee’s personal circumstances, the needs of the enterprise, whether overtime is paid, notice to the employee, usual pattern of work in the industry and employee’s role.

  20. Flexible working arrangements (s 65) An employee who is a parent (or has responsibility for the care of a child) may request a change in working arrangements to assist in caring for the child if the child is under school age or under 18 and has a disability. An employer may only refuse such a request on reasonable business grounds and must provide a written response.

  21. Parental leave An employee is entitled to 12 months of unpaid parental leave associated with the birth of a child if the employee has or will have responsibility for the care of the child (s 70). An employee may request an extension of unpaid parental leave up to 24 months but employer can refuse on reasonable business grounds (s 76).

  22. Annual leave For each year of service, an employee is entitled to 4 weeks paid annual leave (5 weeks for 7 day shift workers) (s 87). Annual leave may be taken for a period agreed between the employer and employee but employer must not unreasonably refuse to agree (s 88). Cashing out can only occur in accordance with an award, enterprise agreement or Act (s 92-94).

  23. Personal/carer’s leave An employee is entitled to: 10 days of paid personal/carer’s leave for each year of service (s 96). 2 days unpaid carer’s leave if member of immediate family requires care (s 102). 2 days of compassionate leave if member of immediate family has illness or injury that poses serious threat to life or dies (s 104).

  24. Community service leave An employee is entitled to leave for jury service or a volunteer emergency management activity (s 109). Community service leave is unpaid except for jury service. An employee undertaking jury service is entitled to paid leave for the first 10 days of absence (s 111).

  25. Long service leave State long service leave legislation continues to apply, including the Long Service Leave Act 1955 (NSW) (s 27(2)(g)). An employee previously entitled to long service leave under an award or agreement will continue to be entitled to long service leave under those provisions (s 113).

  26. Public holidays An employee is entitled to be absent from his or her employment on a public holiday (s 114(1)). An employer may request an employee work on a public holiday, but the employee may refuse if the request is not reasonable or the refusal is reasonable (s 114(2) and (3)). Have regard to factors such as nature of work, personal circumstances, reasonable expectation of employee, payment and notice (s 114(4)).

  27. Notice and redundancy An employer must not terminate an employee’s employment unless a minimum period of written notice is given of up to 4 weeks (or 5 weeks if over 45) depending upon length of service (s 117). Does not apply to employees for a specific task or period, termination for serious misconduct, casual employees, employees under a training arrangement or daily hire employees (s 123).

  28. Notice and redundancy (cont.) An employee who is made redundant is entitled to be paid redundancy pay depending upon length of service (s 119). An employee is redundant if terminated: because the employer no longer requires the job done by anyone (other than ordinary or customary turnover of labour); because of insolvency or bankruptcy.

  29. Fair work information statement The Fair Work Information Statement must contain information about the NES, modern awards, agreement-making, freedom of association, termination of employment, right of entry, etc (s 124). An employer must give every employee the Fair Work Information Statement before, or as soon as practicable after, the employee starts employment (s 125).

  30. Minimum wages FWA must conduct an annual wage review an vary the national minimum wage order or modern award wages (s 285). FWA must determine a national minimum wage order setting a national minimum wage and special minimum wages for junior employees, employees under training arrangements and employees with a disability (s 294).

  31. Modern awards FWA is required to establish a system of “modern awards” that: are simple and easy to apply; provide a fair minimum safety net; are economically sustainable; promote collective enterprise bargaining; constitute a certain, stable and sustainable modern award system.

  32. Terms of modern awards Modern awards may deal with (s 139): minimum wages; type of employment (full-time, part-time, casual, shift work and flexible work arrangements); hours of work, rostering, etc; overtime rates; penalty rates for unsociable hours, weekends or public holidays or shift work;

  33. Terms of modern awards (cont.) annualised wage and salary arrangements; allowances for expenses, skill or disabilities associated with particular work; leave and leave loading; superannuation; consultation, representation and dispute settling procedures; terms that supplement the NES (s 55).

  34. Terms of modern awards (cont.) A modern award must not contain: an objectionable term; terms requiring unreasonable deductions from wages; discriminatory terms; terms containing state-based differences; terms dealing with long service leave.

  35. Application of modern awards A modern award applies to an employer or employee if the modern award (s 47): is expressed to cover the employer or employee; is in operation; and no other provision of the Act provides that the modern award not apply; but does not apply to a “high income employee”.

  36. Enterprise agreements Types of enterprise agreements (s 172): Single-enterprise agreement made by an employer (or related employers); Multi-enterprise agreement made by a number of employers; Greenfields agreement between employer(s) and one or more employee organisation relating to a business being established.

  37. Bargaining and representation An employer must give notice to employees who will be covered by the agreement of the right to be represented (s 173). An employer must ensure employees are given a copy of or access to the proposed agreement 7 days before it is voted upon (s 180). An employer may ask employees to approve the agreement by voting for it (s 181).

  38. Approval of agreements FWA must approve an agreement if it was (s186): genuinely agreed to by the employees and employer(s); do not contravene s 55; passes the better off overall test (“BOOT”); group of employees was fairly chosen; does not contain unlawful terms; not contrary to good faith bargaining.

  39. Better off overall test (“BOOT”) Section 193(1): An enterprise agreement ... passes the better off overall test ... if FWA is satisfied ... that award covered employee, or prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.

  40. Good faith bargaining Bargaining representative must comply with good fair bargaining requirements including (s 228): attending meetings at reasonable times; disclosing information in a timely manner; responding to and giving genuine consideration to proposals; refraining from capricious or unfair conduct; recognising other bargaining representatives.

  41. Bargaining orders To assist bargaining, FWA may make a : Bargaining order specifying actions to be taken to comply with good faith bargaining requirements (s 230-231); Serious breach declaration (s 234-235); Majority support determination (s 236-237); Scope order (s 238).

  42. Workplace determinations Upon application by a bargaining representative, FWA may make the following determinations: Low-paid workplace determination (s 262-263); Industrial action related workplace determination (s266-267); Bargaining related workplace determination (s 269-270).

  43. NES, awards and agreements A modern award or enterprise agreement cannot exclude the NES, but may supplement NES standards or have ancillary provisions (s 55); A modern award does not apply to an employee when an enterprise agreement applies except outworker terms (s 57); Only one enterprise agreement can apply to an employee at a particular time (s 58).

  44. Transfer of business Transfer of business occurs when (s 311): Employment with old employer is terminated; Commence with new employer within 3 months; Performing substantially the same work; Transfer of assets or outsourcing arrangement between old and new employer or new employer is associated entity.

  45. New South Wales system • Awards setting fair and reasonable conditions of employment for employees: s 10. • Enterprise agreements (s 31): (i) with industrial organisation; (ii) with employees directly. • Conciliation and arbitration of industrial disputes (s130).

  46. Inconsistency of federal and state laws • Direct inconsistency; • Cover the field; • Commonwealth expressly excludes the operation of certain State laws (s 26); • Modern awards or enterprise agreements prevail over State laws to the extent of any inconsistency (s 29).

  47. Enforcement of awards and enterprise agreements • The Federal Court or Federal Magistrates Court may make any order the court considers appropriate, including injunction or compensation (s 545(1)); • An eligible State or Territory court may order employer to pay an amount payable under the Act or a fair work instrument (s 545(3)); • Court may impose penalty of up to $6,600 (or $33,000 for a corporation) in case of breach of the NES, a modern award, enterprise agreement or workplace determination (s 546);