Commonwealth penalty unit increase

From 31 July 2015, the Commonwealth penalty unit increased from $170 to $180.

This takes the maximum penalty for taking unlawful adverse action against another person from $51,000 to $54,000 for a corporation, and to up to $10,800 for an individual.

Employers should be mindful of the increase, especially in light of the growing trend of accessorial liability prosecutions. Human resource managers, line managers, general counsel, directors and officers of a company can also be found liable for breaches of the Fair Work Act 2009 (Cth) if they are “involved in” a contravention.

The recent increase is consistent with inflation since the value was last adjusted in December 2012. However, the Federal Government has flagged it will introduce ongoing indexation of penalty units based on the Consumer Price Index, with indexation occurring on 1 July every three years. The next indexation is due to occur on 1 July 2018.

Traditional Rights and Freedoms - Encroachment by Commonwealth Laws

On 3 August, 2015, the Australian Law Reform Commission (ALRC) released the Interim Report of its review of Commonwealth legislation. The ALRC is charged with identifying provisions that unreasonably encroach upon traditional rights, freedoms and privileges.

A particular focus of its inquiry is workplace relations, along with Commonwealth laws in the areas of commercial, corporate and environmental regulation.

The Interim Report examines whether or not the protections in the Fair Work Act 2009 (Cth) adequately protect Australia’s international obligations in relation to freedom of association and the right to strike, as well as existing discrimination laws and the effect that these laws have on individual freedoms, including freedom of speech.

The Interim Report also considers whether the Fair Work Act 2009 (Cth) unjustifiably limits the right of employees under international law to collectively bargain for terms and conditions of employment.

Submissions on the Interim Report closed on 21 September 2015, and the ALRC is due to present a final report to the Attorney-General in December 2015.

Victorian inquiry into portable long service leave schemes

The Victorian Economic, Education, Jobs & Skills Committee is currently conducting an inquiry into portable long service leave in Victoria.

Portable long service leave arrangements allow employees to take their long service leave entitlements with them when they move between employers in a single industry. For example, a portable long service leave scheme has existed in the Victorian building and construction industry since the 1970s. The current inquiry could result in the more widespread adoption of the scheme.

The establishment of the inquiry reflects the increasing mobility  of the workforce within industry sectors. Figures quoted by the Victorian Government suggest that only one quarter of Australian workers remain with the same employer for ten years or more, the usual qualifying period for long service leave.

The Victorian Employers’ Chamber of Commerce and Industry has submitted that a proposed extension of portable long- service leave across Victorian workplaces would impose an extra $84 million per year on businesses, while failing to lift productivity.

Submissions have now closed, and the Committee is due to release its report by 1 May 2016.

Trade union royal commission update

Despite challenges from the Australian Council of Trade Unions (ACTU), Royal Commissioner, The Honourable John Dyson Heydon AC QC, has not excused himself from the Royal Commission into Trade Union Governance and Corruption.

As has been widely reported, Commissioner Heydon determined that there was no rational basis for concluding that a fair-minded observer might reasonably apprehend any predisposition against the Labor Party or the unions. He also concluded that he would not be seen as being biased for accepting an invitation to deliver the Sir Garfield Barwick lecture, which was promoted as a Liberal NSW event, with funds raised going toward the party’s state election campaign. Commissioner Heydon took the view that any speech which he delivered at the fundraiser was intended to be legal, not political.

The ACTU has opted not to pursue an appeal to the High Court. Public hearings resumed in mid-September, with the Commission now focussing on allegations against union officials of the Construction, Forestry, Mining and Energy Union. The Commission will continue hearings until December 2015.

Commonwealth fined $220,000 over inadequate implementation of work, health and safety policies and procedures

A recent decision of the Federal Court demonstrates the need for work health and safety policies and procedures to be enforced, not simply present.

Comcare brought proceedings against the Commonwealth of Australia in relation to military exercises carried out by the Australian Defence Force (ADF). The Commonwealth admitted contravening the Occupational Health and Safety Act 1991 (Cth) (the predecessor to the current Work, Health and Safety Act 2011 (Cth)).

During the training exercise, a Special Forces soldier received a single, fatal gunshot wound to the head and a second Special Forces soldier was wounded. The two soldiers were positioned behind a penetrable wall at which others were shooting.

Comcare and the Commonwealth knew of the significant risk to its employees posed by live firing, and had documented a range of procedures, instructions and training to address the serious risk.

However, the Court considered these measures were insufficient. The relevant manual contained inadequate procedures to check, monitor or ensure that the Commonwealth’s procedures were being implemented, and there was no system in place to evaluate the effectiveness of the Commonwealth’s policies.  There was also no risk management plan or risk assessment prepared for each separate training exercise.

A penalty of $220,000 was imposed on the Commonwealth for its admitted contravention. This amount represents approximately 90% of the relevant upper penalty limit, reflecting the extremely serious nature of the contraventions. Employers should ensure that there are mechanisms in place to regularly review their work health and safety policies and procedures, and that any enforcement measures are working.