Hope for employers covered by multiple awards

Justice Iain Ross, President of the Fair Work Commission (Commission), foreshadowed at a recent conference that the Commission is considering ways in which it can reduce complexity in modern awards and the difficulties associated with coverage by multiple awards.

The conference was focused on the research being undertaken by the Australian Workplace Relations Study (AWRS). The AWRS is the first Australia-wide statistical review of employee data since the 1995 Australian Workplace Industrial Relations Survey.It will inform the Commission’s approach to annual wage reviews, pay equity research and General Manager’s reports.

After acknowledging the significant advancement made in reducing the number of awards operating in Australia from over 1500 to 122, President Ross said he is agnostic about the need to further reduce the number of awards and is now considering ways of alleviating the regulatory burden on employers of being subject to multiple awards. President Ross also foreshadowed the publication of a background paper on the issue in the near future.

While President Ross’s acknowledgement of the need for something to be done about regulatory complexity and multiple award coverage is heartening, it remains to be seen what practical steps the Commission will take to address these issues, and what price will be paid for increased simplicity.

High income threshold rises

From 1 July 2015, the high income cap for award and agreement-free employees to bring unfair dismissal claims has increased from $133,000 to $136,700. This applies to dismissals occurring on or after 1 July 2015.

The rise in the statutory high income level also means the compensation cap for unfair dismissal applications will increase from $67,500 to $68,350.

Employers should also remember that award-prescribed minimum pay rates and allowances increased from 1 July 2015. According to the Commission, all modern awards available on its website have now been updated to reflect these increases.

Accrual of annual leave while injured: Appeal to NSW Nurses decision dismissed

In the Autumn 2015 edition of the Bulletin, we discussed the Federal Circuit Court case of NSW Nurses and Midwives’ Association v Anglican Care, which made it clear that, at least in New South Wales, employees will continue to accrue annual leave while they are absent from work and receiving workers’ compensation benefits.

The appeal judgment was handed down on 5 June 2015 by a Full Court of the Federal Court of Australia, which unanimously held that Anglican Care’s appeal should be dismissed as the initial judge considering the case had correctly interpreted the relevant legislative provisions. The appeal decision confirms the original finding in NSW Nurses and, subject to a possible appeal to the High Court, means employers in New South Wales need to operate on the basis that employees who are away from work and receiving workers’ compensation benefits are also accruing annual leave entitlements.

High Court grants special leave to challenge Full Federal Court’s decision concerning agreed penalties

The High Court has granted special leave to the Commonwealth, the Fair Work Building Inspectorate, the CFMEU and the CEPU to appeal a Full Federal Court decision which prohibited the longstanding practice of parties making joint submissions to the Court seeking an agreed penalty.

The Full Court had rejected an agreement between the Fair Work Building Industry Inspectorate, the CFMEU and the CEPU that the two unions should pay a total of $150,000 in civil penalties for various contraventions of the Building and Construction Industry Improvement Act 2005 (Cth). The Full Court held that joint submissions concerning an appropriate penalty are merely the expression of a shared opinion and are neither fact nor a submission regarding the law. Accordingly, such submissions  are inadmissible. In essence, the Court took the view that parties to a proceeding cannot usurp the Court’s role of examining the evidence and the law, and determining an appropriate penalty.

The Full Court’s decision prevents regulators, including the Fair Work Building Industry Inspectorate and the Fair Work Ombudsman, from reaching an agreement about penalty with any party that is the subject of enforcement proceedings. This is likely to introduce significant uncertainty. For example, it is estimated that approximately 75% of regulatory enforcement cases brought by the Fair Work Ombudsman involve agreed civil penalties.

The Federal Attorney-General, George Brandis, lodged an application with the High Court seeking special leave to challenge the Full Court’s decision. In the original proceedings, the Commonwealth (which was granted leave to intervene by the Court) had argued that joint submissions on appropriate penalties are a well-established practice, and that Parliament intended that regulators should play a central role in identifying and pursuing specific relief.

The original parties to the proceeding each supported the Commonwealth’s position. A date for the hearing of the appeal has not yet been scheduled.

Further training a possible precondition to the grant of an entry permit

The Commission has indicated that a union official seeking an entry permit may need to demonstrate that they have undertaken recent training in relation to their rights and obligations as a permit holder under the Fair Work Act 2009 (Cth) (FW Act)  before a permit is granted.

Under the FW Act, an organisation can apply to the Commission for an entry permit for one of its officials, which the Commission may grant if it is satisfied that the official is a “fit and proper person” to hold an entry permit. One factor the Commission is required to consider in determining whether a union official is a “fit and proper person” is whether the official has received appropriate training  about a permit holder’s rights and responsibilities.

The CFMEU made an application to the Commission for the issue of an entry permit to three individual officials. In response, the Director of the Fair Work Building Industry Inspectorate  filed submissions asserting that the officials had not received appropriate training in relation to the rights and responsibilities of permit holders under the FW Act.

The three officials had last received training in April 2012. The Director argued that in light of a number of amendments to the FW Act in the intervening period (including substantial amendments that took effect on 1 January 2014), the officials could not be said to have a proper understanding of the privileges and obligations arising under the FW Act.

Consequently, the CFMEU filed further material demonstrating that each of the proposed permit holders had completed further training in June 2015 in relation to their rights and obligations as a permit holder. When he learned of this additional training, the Director filed submissions stating he no longer took issue with the appropriateness of the training undertaken by the officials.

Deputy President Gostencnik acknowledged that each of the officials had completed an approved training course concerning federal right of entry laws, finding them to be “fit and proper” within the meaning of the FW Act. As a result, they were each issued with an entry permit.

The Director’s initial submissions recognise the width of the powers possessed by a permit holder under the FW Act and highlight the importance of those powers being exercised correctly and responsibly. The Director’s submissions also raise the possibility of future intervention in cases where the Fair Work Building Industry Inspectorate has concerns with the currency or adequacy of training received by an applicant for an entry permit.