Russell Kennedy reviews what major changes to Workplace Relations, Employment and Safety laws have already happened this Financial Year, and then gazes into a crystal ball to see what may also be on the horizon

What has already happened this Financial Year?

Members of Federal Parliament and senior Commonwealth public sector employees have had their pay increases frozen as a result of this year’s Budget.

Compulsory employer contributions under the superannuation guarantee increased to 9.5% of an employee’s ordinary time earnings effective 1 July 2014.

The high income threshold for unfair dismissal claims has increased to $133,000 and the maximum compensation limit for successful claims is now $66,500.

The Fair Work Commission has increased employee minimum entitlements from 1 July 2014 as follows:

  • The national minimum wage has increased by 3% to $640.90 per week, or $16.87 per hour.
  • Minimum wages and allowances in modern awards have similarly increased.
  • 20 year old employees covered by the General Retail Industry Award 2010 will now be entitled to 95% of the adult rate, up 5%.
  • Introductory and levels one and two casual employees covered by the Restaurant Industry Award 2010 will also now be entitled to reduced penalty rates for Sunday work.

The transitional arrangements in most modern awards also came to an end on 1 July 2014. Employers in most sectors will now be able to apply the pay rates, casual loadings and penalties set out in modern awards without having to perform phasing-in calculations.

However, transitional arrangements will still apply under the Cleaning Services Award 2010 and Social, Community Home Care and Disability Services Industry Award 2010 (and for South Australian employers also the Hospitality Industry (General) Award 2010 and Registered and Licensed Clubs Award 2010).

Employers should check that they are providing each employee covered by a modern award with at least the minimum entitlements provided under that award. If an employer has an enterprise agreement, it will need to be providing the same minimum entitlements as the base rate in an enterprise agreement cannot be any less than the relevant award rate or, if no award applies, the national minimum wage.

What is likely to also happen this Financial Year?

The Abbott Government’s reforms to the Fair Work Act 2009 (Cth) are likely to pass the Senate and become law in one form or another – see our previous Alert.

The Abbott Government’s “Budget repair levy” and some other Budget initiatives are also likely to pass the Senate and become law – see our previous Alert.

The Abbott Government’s Building and Construction Industry (Improving Productivity) Bill 2014 (Cth) may pass, which will impact upon how employers in the building and construction industry manage their workforce and deal with unions.

The High Court of Australia is likely to hand down decisions relating to whether:

  • an implied term of mutual trust and confidence exists in employment arrangements; and
  • BHP Coal took unlawful adverse action when it dismissed a worker for waving a “scab” sign at a union picket line during a protected strike.

The Fair Work Commission is likely to complete its review of default superannuation funds for modern awards.

The Fair Work Commission is likely to complete its review of annual leave provisions for modern awards relating to:

  • cashing out annual leave;
  • dealing with excessive annual leave;
  • compulsory annual leave during an employer’s annual close-down period;
  • granting annual leave to employees in advance;
  • allowing employees to purchase annual leave;
  • dealing with the payment of annual leave entitlements on termination; and
  • dealing with annual leave and the payment of wages by EFT.

The Heydon Royal Commission into Trade Union Governance and Corruption will publish its findings and recommendations, which may result in new laws being passed this Financial Year.