The Jobs and Skills Summit held in Canberra last week proposed a long list of reforms and other actions categorised as “immediate actions”, “areas for further work” and “complementary existing commitments.” The extent of the proposed reforms is much greater than what was originally proposed by the ALP while in opposition. Whether any of the proposals will be part of the legislative changes will in part depend on the consultation that’s now taking place with employers and unions. The Government has stated that it wants to have the legislation in place by Christmas. However, it’s likely that legislative changes will be referred to a Senate Select Committee and there will need to be negotiations with the minor parties in the Senate (noting the Greens are generally supportive).
What should employers consider now?
The main outcomes from the Summit that employers should start considering now, given the potential impact on their operations once introduced, are:
- Encouraging multi-employer bargaining: This is currently available but rarely used because of the restrictions associated with it. A number of employer and employer groups have already expressed concern about multi-employer bargaining particularly if, for example, it involves a potential for recourse to protected industrial action and arbitration by the Fair Work Commission (FWC).
- Unfair Contracts: Facilitating workers to be able to challenge unfair contractual terms.
- Bargaining Representatives: Providing “proper support” to employer bargaining representatives and union delegates. This may involve mandated paid training in conjunction with strengthened adverse action provisions.
- Awards and NES: Potential improvements to modern Awards and the National Employment Standards (NES) under the Fair Work Act 2009 (Cth) including stronger access to flexible working arrangements and unpaid parental leave, perhaps with changes to the NES.
- BOOT Test: Making the current better off overall test (BOOT) “simple, flexible and fair”. However, there is also a suggestion that in conjunction with this the FWC will be able to deal with an employee claim (after the enterprise agreement is approved) that they are worse off under the approved agreement and to seek an order for a payment to ensure the employee is not worse off overall.
- Terminating enterprise agreements: Amendments to the ability to terminate enterprise agreements and specifically:
- Sunset so called “zombie” agreements i.e. enterprise agreements which are long past their nominal expiry date;
- Introduce significant limitations on unilateral termination of an enterprise agreement once it has passed its nominal expiry date in circumstances where the termination may result in the reduction of terms and conditions.
- Worker protections: Stronger protections for workers against adverse action, discrimination and harassment.
- Gender Equality: Strengthening existing reporting standards to require employers with 500 or more employees to commit to measureable targets to improve gender equality in their work places.
- Gender pay gap: Requiring businesses with 100 or more employees to publicly report their gender pay gap to the workplace gender equality agency.
- National Construction Industry Forum: Establishing this forum to address issues such as mental health, safety, training, apprentices, productivity, culture diversity and gender equality in the industry.
The above are in addition to existing commitments, with the most notable of those being:
- Apprentices: One in ten workers on major government projects to be an apprentice, trainee or cadet through the Australia Skills Guarantee.
- Energy sector: Training 10,000 New Energy Apprentices and funding a New Energy Skills Project.
- Fair Work Act: Gender pay equity and job security to be included as objects in the Fair Work Act and amending the remuneration principle to facilitate pay equity claims.
- Same job, same pay: Legislate “same job, same pay” with the aim of employees and contractors or employees of a contractor having the same conditions as an employee performing the “same job”.
- New panels: The establishment of two new expert panels in the FWC for pay equity and the care and community sector.
- Pay secrecy: Prohibiting pay secrecy clauses and giving employees the right to disclose their remuneration if they wish.
- Casuals: Setting an objective test for determining when a worker is a casual. This is likely to mean a change to the existing legislative criteria.
- New forms of work: Extending the powers of the FWC to include “employee like” forms of work thus enabling the FWC to make orders for minimum standards in relation to new forms of work such as gig work.
- Fixed term contracts: Limiting the use of fixed term contracts.
- Superannuation: The NES to include a right to superannuation.
- Wage theft: Criminalising wage theft and enhancing Fair Work Act compliance and enforcement, including with a small claims procedure.
- Sexual harassment: Specifically prohibiting sexual harassment at the workplace and enable the FWC to resolve disputes relating to workplace sexual harassment.
- Secure jobs code: Establishing the Secure Australian Jobs Code to prioritise secure working.
- Government contracts: Utilising Government contracts to enable Government purchasing power to be used to support businesses that engage in “fair, equivalent, ethical and sustainable practices”.
- Aged Care: Support and if successful fund increases to Award wages for Aged Care Workers through the Government submission to the FWC.
- First Nations: Work with Australia’s largest 200 employers on public reporting and improving employment of First Nations employees.
There has been considerable interest in what the proposed changes to multi-employer bargaining will mean.
It’s likely the focus will initially be on what are regarded as low paid sectors such as aged care, child care and community services where, with low levels of unionisation, funding and other constraints, there are few enterprise agreements. Some employers in these sectors may be reluctant to enter into sector wide or multi-employer bargaining.
If the proposed multi-employer changes are to be effective from the union standpoint, they will need to have the following features:
- Where a union advises an employer it wishes to engage in multi-employer bargaining, the good faith bargaining requirements of the legislation will apply which effectively require bargaining but not agreement;
- Protected industrial action (currently prohibited) would need to be available to provide leverage;
- In the effect of an impasse, there is access to arbitration by the FWC; and
- The unions may also try and pursue some sort of charge for non-union members who ultimately receive the benefit of the union negotiations.
Same Job, Same Pay
While there has been less discussion recently about the concept of “same job, same pay” this will need to be carefully considered by employers as most would now have a range of workers who are not directly employed by them that arguably may be performing the same job as someone employed by them.
Employers should now be identifying those third party arrangements and considering what the implications of “same job, same pay” may be even though at this stage there is no further specific detail on how this criteria will operate in practice. Johnson Winter & Slattery can assist with this review.