On 27 June 2013, Federal Parliament passed the Fair Work Amendment Act 2013 (Cth) (Amendment Act). This legislation implements a number of further recommendations of the 2012 Fair Work Act Review; and several other policy proposals including the new anti-bullying jurisdiction of the Fair Work Commission (FWC).
In order to obtain support for passage of the legislation by the cross-bench MPs in the House of Representatives, the Government agreed to delay until 1 January 2014 the commencement of the anti-bullying provisions. In addition, proposals to empower the FWC to arbitrate in stalled greenfields agreement negotiations, and intractable bargaining disputes, were abandoned.
In this In Brief, we examine the main changes to the FW Act effected by the Amendment Act, and some of the steps that employers may need to consider taking in light of these changes.
Key Changes to the FW Act
The original Fair Work Amendment Bill (Bill) included proposed amendments to the Fair Work Act 2009 (Cth) (FW Act) relating to various “family-friendly measures”; protection of penalty rates; FWC’s anti-bullying jurisdiction; and union right of entry. Although at one stage it looked like the Government was prepared to omit the right of entry changes, all of these provisions ultimately formed part of the Amendment Act.
A number of amendments to the Bill were moved by the Government and were also included in the Amendment Act – for example, providing the FWC with powers of consent arbitration in general protections claims involving dismissal, and unlawful termination claims.
These include changes in the following areas:
- The right to request flexible work arrangements – for example, expanding the range of employees who can make such a request, and defining the “reasonable business grounds” upon which employers may refuse a request.
- Unpaid parental leave – expanding the current entitlement of parents to take concurrent unpaid parental leave from a maximum of 3 weeks to 8 weeks, and providing parents with greater flexibility as to when this kind of leave can be taken).
- Special maternity leave – ensuring that any period of unpaid special maternity leave taken by an employee prior to giving birth does not reduce that employee’s entitlement to unpaid parental leave.
- Transfer to a safe job – removing the requirement that an employee must have 12 months’ continuous service with her employer before having a right of transfer to a safe job during pregnancy.
- Consultation over changes to rosters or working hours – modern awards and enterprise agreements must include provisions requiring employers to consult with employees, in order to prevent unilateral changes to rosters or working hours which adversely impact on the family life of employees.
The Amendment Act amends the “modern awards objective” (FW Act, section 134) to require the FWC – when exercising its functions in relation to modern awards – to take into account the need for additional remuneration for employees working overtime, shift-work, irregular/unpredictable hours or on weekends.
So (for example) when the FWC is dealing with an application to vary a modern award, it would have to consider the necessity of preserving existing penalty rates arrangements (therefore making any attempt to reduce such entitlements highly unlikely to succeed).
Anti-bullying jurisdiction of FWC
Perhaps the most significant aspect of the Amendment Act is its establishment of the anti-bullying jurisdiction within the FWC. With effect from 1 January 2014 (six months later than the Government intended), this will allow a worker who is bullied at work to apply to the FWC for an order to stop the bullying.
Until now, Australian employees have been protected from workplace bullying primarily through federal, state and territory work health and safety laws. Anti-discrimination and workers’ compensation laws also provide some level of protection.
However, the Amendment Act for the first time establishes the right of workers to seek redress for workplace bullying through specific legislation. Bullying is defined as repeated unreasonable behaviour by an individual or group that creates a risk to another worker’s health and safety. Management action carried out in a reasonable manner will not constitute bullying (e.g. performance management or disciplinary action).
The remedies that can be ordered by the FWC include orders requiring an individual or group to stop bullying behaviour, or requiring an employer to implement anti-bullying policies and training. However, orders for compensation or reinstatement are not available.
Government amendments to the Bill (which formed part of the Amendment Act) clarified that members of the Australian Defence Force are not able to bring bullying claims; and that the FWC can dismiss a claim if it involves matters relating to Australia’s defence, national security or certain Australian Federal Police operations.
A point that has not received much attention in commentary on the FWC’s anti-bullying jurisdiction is that its operation is limited to the following types of employers (and their workers, including employees, contractors, trainees/apprentices, etc):
a person conducting a business or undertaking within the meaning of the Work Health and Safety Act 2011 (Cth), where:
- the person is: a constitutional corporation; or the Commonwealth; or a Commonwealth authority; or a body incorporated in the ACT or NT; or
- the business or undertaking is conducted principally in a Territory or Commonwealth place.
This means that workers engaged by the following types of employers will not be able to bring an anti-bullying claim in the FWC:
- unincorporated businesses such as sole traders and partnerships;
- State public service departments and agencies, including in Victoria;
- certain State government business enterprises and entities (unless they can be characterised as constitutional corporations).
Union right of entry
The provisions in Part 3-4 of the FW Act have been amended in the following main ways:
- Location of meetings – where agreement cannot be reached between a right of entry permit-holder and the occupier of premises, a union may conduct meetings with employees in lunch-rooms on work sites.
- Accommodation and transport arrangements to facilitate right of entry to remote work sites – in the absence of agreement, an occupier must enter into an accommodation or transport arrangement to assist a permit-holder to obtain access to a remote workplace (i.e. where the only realistic means of access to the premises is by transport provided by the occupier, or where the only available accommodation is that provided by the occupier). The occupier is not, however, required to cover the cost of the accommodation or transport.
- FWC’s dispute resolution powers – the FWC will be able to deal with disputes over right of entry transport and accommodation arrangements (see above); and the frequency of exercise by permit-holders of entry rights for purposes of holding discussions with employees, where this requires an unreasonable diversion of the occupier’s critical resources.
The Government amendments to the Bill resulted in a number of other changes to the FW Act, the most significant of which are as follows:
- FWC’s powers when conducting a conference – section 592 of the FW Act has been amended to clarify that, when performing its functions or exercising its powers by holding a conference, the FWC may mediate, conciliate, make a recommendation or express an opinion. This reflects the FWC’s powers when dealing with disputes under section 595.
General protections consent arbitration – in general protections claims involving dismissal, and unlawful termination claims, the dismissed employee will now have the option (where the FWC has been unable to settle the claim at a conference) of having the matter arbitrated by the FWC if the respondent to the claim agrees. That is, once the FWC issues a certificate that all reasonable attempts to resolve the claim have been unsuccessful, the applicant has 14 days in which to elect to:
- pursue the general protections or unlawful termination claim in the Federal Circuit Court or Federal Court; or
- enter into consent arbitration by the FWC (in which the tribunal will have powers to make the same kinds of orders as in the unfair dismissal jurisdiction, e.g. reinstatement, compensation; similar provisions relating to appeals and costs orders will also apply); or
- elect not to proceed further with the claim.
- Unlawful termination claims – the time limit for bringing these claims has been aligned with that for unfair dismissal and general protections dismissal claims, i.e. 21 days.
Implications and Implementation
The new anti-bullying jurisdiction of the FWC has the greatest potential impact on employers of all the changes introduced by the Amendment Act. Significant resources were allocated to the FWC in the recent federal Budget to enable it to deal with bullying claims, with the tribunal reportedly expecting around 3,500 claims per year.
However, given the six-month delay in the commencement of the anti-bullying jurisdiction, employers have some time in which to take steps to prepare, for example by:
- reviewing and, if necessary, updating policies and procedures that are to be used for dealing with bullying complaints (including considering whether procedures should be amended to reflect the ability to bring a bullying complaint in the FWC); and
- ensuring that managers, staff and contractors are properly trained in relation to managing bullying issues and applicable policies and procedures.
Ahead of the commencement of the remaining provisions of the Amendment Act, employers should:
- review relevant workplace policies, and possibly also employment contracts, in light of the changes to various aspects of parental leave and the extension of the right to request flexible work to a much wider range of employees;
- monitor developments relating to new award provisions requiring consultation over changes to rosters and working hours – and be prepared to respond to claims for clauses dealing with these issues in new enterprise agreements;
- identify a preferred location within the workplace where union permit-holders exercising entry rights can hold meetings with employees, and attempt to reach agreement with the relevant union(s) on this issue; and
- where the employer operates in remote locations, consider how union requests for transport or accommodation assistance to facilitate access will be dealt with, and implement processes to ensure timely cost-recovery from the union(s) for providing such assistance.
Finally, once the relevant provisions take effect, employers should consider (on a case-by-case basis) whether they would be prepared to agree to arbitration by the FWC of general protections dismissal claims/unlawful arbitration claims – taking into account that when the FWC issues a certificate following unsuccessful conciliation, it will be able to indicate whether the claim has no reasonable prospect of success.