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2004-2005-2006-2007
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
WORKPLACE RELATIONS AMENDMENT
(A STRONGER SAFETY NET) BILL 2007
REVISED EXPLANATORY MEMORANDUM
THIS MEMORANDUM TAKES ACCOUNT OF AMENDMENTS MADE BY
THE HOUSE OF REPRESENTATIVES
TO THE BILL AS INTRODUCED
(Circulated by authority of the Minister for Employment and Workplace Relations, the
Honourable Joe Hockey MP)
WORKPLACE RELATIONS AMENDMENT
(A STRONGER SAFETY NET) BILL 2007
OUTLINE
This Bill would amend the Workplace Relations Act 1996 (the Act) to:
· establish the Workplace Ombudsman and the Workplace Authority Director as statutory
office holders appointed by the Governor-General, and create the Office of the Workplace
Ombudsman and the Workplace Authority as statutory agencies;
· require the Workplace Authority Director to be satisfied that specified workplace
agreements provide fair compensation in lieu of the modification or exclusion of protected
award conditions that apply to an employee or employees (the fairness test);
· establish a compliance framework to ensure the effective operation of the fairness test;
· clarify and simplify the provisions in the Act and the Workplace Relations Regulations
2006 (the Regulations) that mean that bargaining services fees and other objectionable
provisions must not be included in workplace agreements; and
· remove the requirement that federally registered organisations must have a majority of
members in the federal system in order to become registered, or remain registered under
Schedule 1 to the Act.
Fairness test - Schedule 1
Schedule 1 of the Bill would introduce a fairness test that would apply to workplace agreements
(and variations to workplace agreements) lodged on or after 7 May 2007 that:
· cover employees who work in industries or occupations usually regulated by awards, and
· modify or exclude protected award conditions.
The test would not apply to Australian Workplace Agreements (AWAs) covering employees
with full-time (or full-time equivalent) base salaries of $75,000 or more.
Protected award conditions would be those that apply under a federal award, or a preserved State
instrument, which binds the employer. If there is no such instrument, the protected award
conditions would be those in an award designated as appropriate by the Workplace Authority
Director for the purpose of the fairness test.
The fairness test would require the Workplace Authority Director to be satisfied that:
· in the case of an AWA - the agreement provides fair compensation to the employee in lieu
of the modification or removal of the employee's protected award conditions
· in the case of a collective agreement - on balance, the agreement provides fair
compensation, in its overall effect on employees, in lieu of the modification or removal of
the employees' protected award conditions.
In determining whether fair compensation has been provided, the Workplace Authority Director
would primarily consider the value of any monetary and non-monetary compensation. The
Workplace Authority Director would also be able to consider the personal circumstances of
employees, including their family responsibilities. In exceptional circumstances, and where it is
not contrary to the public interest to do so, the Workplace Authority Director would also be able
to have regard to the employer's industry, location or economic circumstances and the
employment circumstances of the employee or employees.
Senate page 1 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
If a workplace agreement does not provide fair compensation in lieu of the protected award
conditions, the Workplace Authority Director would provide advice on how the agreement could
be varied to pass the fairness test. The employer would have 14 days to vary the agreement
(including by way of an undertaking).
If the employer does not vary the agreement within this period, the agreement would cease to
operate. If the employer does vary the agreement within this period, the Workplace Authority
Director would test the varied agreement. If the agreement still does not pass the test, the
workplace agreement would cease to operate.
· In either of these situations, when the agreement ceases to operate the employer and the
employee would be bound by the instrument that would have applied to them, but for the
unfair agreement. This instrument could be an earlier agreement, the award, or a preserved
State instrument. In the case of an employee for whom an award was designated (and
where no other instrument applies), the protected award conditions from the designated
award would apply.
· The Australian Fair Pay and Conditions Standard would continue to operate, in accordance
with the existing provisions of the Act. Any applicable preserved redundancy provisions,
or undertakings made by the employer, following unilateral termination of an earlier
agreement would also have effect.
Where an agreement does not pass the fairness test, the Bill would entitle an employee to recover
compensation for any shortfall arising if the value of entitlements under the `unfair' agreement is
less than the value of entitlements under an otherwise applicable instrument, or the protected
award conditions in a designated award, had they applied during the fairness test period.
To ensure the effective operation of the fairness test the Bill would:
· prohibit an employer from dismissing an employee for the sole or dominant reason that an
agreement fails, or may fail, the fairness test;
· prohibit an employer from coercing an existing employee to agree to modify or remove a
protected award condition; and
· require an employer to pay any compensation to which the employee is entitled within
specified time limits.
These would be civil remedy provisions.
In addition, the Act would be amended to make clear that the current prohibition against AWA
duress applies to the situation where an employer who has purchased a business requires an
existing employee of that business to make an AWA as a condition of ongoing employment.
This amendment clarifies the existing law and does not involve the creation of a new penalty
provision.
Workplace Authority Director - Schedule 2
Schedule 2 would establish the Workplace Authority Director as a statutory office holder to be
appointed by the Governor-General.
Schedules 2 would also create the Office of the Workplace Ombudsman and the Workplace
Authority as statutory agencies for the purposes of the Financial Management and
Accountability Act 1997.
Workplace Ombudsman - Schedule 3
Schedule 3 of the Bill would establish the Workplace Ombudsman as a statutory office holder to
be appointed by the Governor-General. Schedule 3 would also create the Office of the
Senate page 2 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Workplace Ombudsman, a statutory agency for the purposes of the Financial Management and
Accountability Act 1997.
Prohibited Content - Schedule 4
Schedule 4 of the Bill would clarify and simplify the provisions in the Act and the Regulations
that mean that bargaining services fees and other objectionable provisions must not be included
in workplace agreements.
The amendments would expressly provide that objectionable provisions as set out in the freedom
of association provision in Chapter 16 of the Act, including bargaining services fees, are
prohibited content. A workplace agreement must not be lodged if it contains prohibited content
and a term of the workplace agreement is void to the extent that it contains prohibited content.
The amendments do not affect other matters that are prohibited content as set out in the
Regulations.
Membership requirements for registered organisations - Schedule 5
Schedule 5 would remove the requirement that federally registered organisations must have a
majority of members in the federal system in order to become registered, or remain registered
under Schedule 1 to the Act.
The amendments would provide that only some or all members of an organisation need to be
federal system employers or federal system employees to be registered under Schedule 1.
Further, the amendments would align the definitions of federal system employer and federal
system employee in Schedule 1 with those in sections 5 and 6 of the Act.
Senate page 3 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
FINANCIAL IMPACT STATEMENT
The Government's proposed legislation will introduce a stronger safety net for working
Australians through the introduction of a Fairness Test that will guarantee entitlements such as
penalty rates and public holiday pay are not traded off without adequate compensation. In
addition, the Workplace Ombudsman will provide additional protection for workers, with the
enhanced role of investigating employers who fail to meet their obligations under the workplace
laws.
Estimated costs associated with the proposed amendments are as follows:
2007-08 2008-09 2009-10 2010-11 Total
(mill) (mill) (mill) (mill) (mill)
Workplace Authority 86.5 69.6 73.3 74.1 303.5
Workplace Ombudsman 18.5 15.2 15.1 15.3 64.1
Department of Employment 1.7 1.0 - - 2.7
& Workplace Relations
Estimated costs: 106.7 85.8 88.4 89.4 370.3
This funding will be provided in the 2007-08 Additional Estimates and will be outlined in the
Employment and Workplace Relations Portfolio Additional Estimates Statements.
Senate page 4 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Notes on Clauses
NOTES ON CLAUSES
Clause 1 - Short title
1. This clause would specify the short title of the enacted Bill. Once enacted, the Bill would be
known as Workplace Relations Amendment (A Stronger Safety Net) Act 2007.
Clause 2 - Commencement
2. This clause would specify when the various provisions of the Bill are proposed to
commence. The time the commencement of the particular provisions would be set out in a table
in subclause 2(1).
3. Item 1 of the table would provide that the preliminary provisions of the Bill (short title,
commencement and effect of Schedules) would commence on Royal Assent.
4. Items 2, 3, and 4 of the table would provide that, respectively, Schedule 1 (which contains
the amendments relating to the fairness test), Schedule 2 (which contains the amendments
relating to the Workplace Authority), Schedule 3 (which contains the amendments relating to the
Workplace Ombudsman) and would commence on a single day to be fixed by Proclamation.
However, if any provisions in the Schedules not proclaimed to commence within 6 months of the
Act receiving Royal Assent, they would commence on the day following that period. It is
expected that the Schedules would be proclaimed to commence before the expiration of the 6
month period.
5. Item 5 of the table would provide that Schedule 4 (which contains the amendments relating
to prohibited content) would commence on Royal Assent.
6. Item 6 of the table would provide that Schedule 5 (which contains the amendments relating
to the membership requirements for registered organisations) would commence on a single day
to be fixed by Proclamation. However, if any provisions in Schedule 5 are not proclaimed to
commence within 6 months of the Act receiving Royal Assent, they would commence on the day
following that period. It is expected that the Schedule 5 would be proclaimed to commence
before the expiration of the 6 month period.
7. Subclause 2(2) would provide that Column 3 of the table contained additional information
that is not part of the amendment Act. Information in this column could be added to or edited in
any published version of the Act.
Clause 3 - Schedule(s)
8. Subclause 3(1) would provide that each Act, and set of regulations, that is Specified in a
Schedule is amended or repealed as set out in that Schedule, and any other item in a Schedule to
this Act has effect according to its terms according to its terms.
9. Subclause 3(2) would provide that the amendment of any regulation does not prevent the
regulation, as so amended, from being amended or repealed by the Governor General.
Senate page 5 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Schedule 1 - The Fairness Test
Part 1 - Main amendments
Workplace Relations Act 1996
Item 1 - After Division 5 of Part 8
10. Item 1 would insert new Division 5A in Part 8 of the Workplace Relations Act 1996 (the
Act) establishing a fairness test for certain workplace agreements. Under the fairness test, the
Workplace Authority would assess whether employees are fairly compensated where a
workplace agreement modifies or excludes any or all of the protected award conditions that
apply to an employee under an award.
· Separate amendments are proposed to deal with employers and employees who moved into
the federal system on 27 March 2006, and remain covered by transitional instruments.
These amendments are set out in Items 41 and 42 of Schedule 1.
An expanded safety net for agreement making
11. Presently, the Australian Fair Pay and Conditions Standard (the Standard) sets out the
minimum wages and conditions of employment that apply to employees in the federal workplace
relations system. The Standard is the safety net for agreement making; employees must receive
pay and conditions equal to, or more favourable than, those in the Standard.
12. The new fairness test would enhance the safety net for those making workplace agreements.
It will allow employers and employees to modify or exclude protected award conditions but only
where employees are fairly compensated. The stronger safety net will provide significant
additional protection for vulnerable employees, including young people and workers from a non-
English speaking background.
Protected award conditions
13. The fairness test would guarantee the following protected award conditions or fair
compensation in lieu of those conditions:
· rest breaks;
· incentive-based payments and bonuses;
· annual leave loadings;
· monetary allowances;
· observance of and payment for public holidays;
· overtime and shift loadings; and
· penalty rates.
14. The protected award conditions for an employee will be those in the federal award which
binds the employer in respect of the kind of work performed by the employee. If there is no such
instrument, and the employee is working in an industry or occupation usually regulated by a
federal award, an appropriate federal award may be designated by the Workplace Authority for
the purposes of applying the fairness test.
Agreements to which the fairness test will apply
15. The fairness test will apply to workplace agreements lodged on or after 7 May 2007.
Senate page 6 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
16. Where an agreement, including an agreement made before 7 May 2007, is varied the whole
agreement will be subject to the fairness test, where the variation excludes or modifies protected
award conditions.
17. The fairness test will apply to Australian Workplace Agreements covering employees with a
gross basic salary of less than $75,000 per annum who are employed in an industry or
occupation in which the terms and conditions are usually regulated by an award, where the
agreement excludes or modifies protected award conditions.
18. Collective agreements covering employees in an industry or occupation in which the terms
and conditions are usually regulated by an award and where the agreement excludes or modifies
protected award conditions will also be subject to the fairness test.
How does the fairness test work?
19. In assessing whether fair compensation has been provided, the Workplace Authority will
primarily consider the value of the monetary and non-monetary compensation that is provided in
lieu of any protected award conditions that are modified or excluded. The Workplace Authority
will also be able to consider the personal circumstances of the employee or employees covered
by the agreement - in particular, their family responsibilities. In exceptional circumstances, and
where it is not contrary to the public interest to do so, the Workplace Authority may also have
regard to the industry, location or economic circumstances of the employer and the employment
circumstances of the employer or employees covered by the agreement.
What happens if an agreement does not pass the fairness test?
20. If an agreement does not pass the fairness test, the employer will have 14 days to rectify the
situation by varying the agreement. If the employer does not vary the agreement, or if the
agreement as varied does not pass the fairness test, the agreement will cease to operate. The
employee will revert to the instrument that would have applied to them at the point the
agreement did not pass, had they not made the agreement. Where an award is designated for the
purposes of applying the fairness test, the employee would retain an entitlement to the protected
award conditions from that designated award (but only where there is no other instrument that
could apply). The employer would be required to pay compensation in respect of the period
when an agreement did not pass the fairness test.
Functions of the Workplace Authority Director
21. Powers are given to the Workplace Authority Director to administer the fairness test, but the
Director can delegate some functions under proposed subsection 153C(1) (see Schedule 2).
Delegations operate subject to any directions issued by the Workplace Authority (proposed
subsection 153C(2)). For this reason, this explanatory memorandum refers to decisions and
actions of the Workplace Authority.
Division 5A - The fairness test
Subdivision A - Preliminary
Section 346B - Definitions
22. Proposed subsection 346B(1) would define a number of terms that are used in this Division.
Key definitions are explained below.
23. Designated award would mean an award determined by the Workplace Authority under
either of proposed sections 346K and 346L. Where there is no relevant award, an award may be
designated for the purposes of ascertaining whether or not the Workplace Authority is required
to decide under section 346M whether a workplace agreement or workplace agreement as varied
Senate page 7 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
passes the fairness test. Where an award is designated, then this is the source of the protected
award conditions for the purpose of applying the fairness test.
24. Enterprise award would mean an award that regulates terms and conditions of employment
for an employee or employees employed in a single business. This definition is relevant to the
process of designating an award, as an enterprise award cannot be designated.
25. Industrial instrument would be defined to include a pre-reform Australian Workplace
Agreement (AWA), a pre-reform certified agreement, a workplace determination, a section
170MX award and an old IR agreement (within the meaning of Schedule 7).
26. Protected award conditions would have the same meaning as in subsection 354(4) but
would be subject to proposed subsection 346B(2).
27. Protected award conditions as defined in subsection 354(4) are terms of an award that:
· are about protected allowable award matters; and
· are not about matters that are specified as not allowable award matters under section 515.
28. The list of protected allowable award matters is contained in subsection 354(4) and includes
rest breaks, incentive-based payments and bonuses, annual leave loadings, public holidays,
monetary allowances, overtime and shift work loadings and penalty rates.
29. Proposed subsection 346B(2) would provide that, for the purposes of the definition of
protected award conditions in proposed subsection 346B(1), outworker conditions are not about
protected allowable award matters.
30. It is not necessary to include outworker conditions in the operation of this Division.
Subsection 354(3) already provides that protected award conditions about outworker conditions
cannot be excluded or modified and will have effect despite any terms of a workplace agreement
that provide, in a particular respect, a less favourable outcome for the outworker. Division 5A of
Part 8 would have effect in relation to workplace agreements as affected by subsection 354(3).
31. Reference award would mean a relevant award or, if there is no relevant award, a
designated award. The fairness test must be applied to certain workplace agreements that
exclude or modify protected award conditions in a reference award.
32. Relevant award would mean an award that:
· but for the operation of a workplace agreement or other industrial instrument in relation to
the employee, regulates (or would regulate) any term or condition of employment of
persons engaged in the same kind of work as that performed by the employee under their
workplace agreement; and
· was binding on the employee's employer immediately before the day on which the
employee's workplace agreement was lodged.
33. The kind of work performed by an employee can be determined by considering the major
and substantial purpose for which the employee was engaged. It would not include work that an
employee may perform from time to time during the course of his or her employment but which
is merely incidental to his or her primary role, for example incidental clerical work.
34. Salary would be defined as gross salary. It would exclude incentive-based payments and
bonuses, loadings (other than casual loadings), monetary allowances, penalty rates, any other
separately identifiable entitlements that are similar to these entitlements or employer
superannuation contributions. The proposed definition is relevant to determining whether an
AWA is subject to the fairness test.
Senate page 8 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
35. Proposed subsection 346B(3) would make clear that, unless the contrary intention appears,
this Division applies to a workplace agreement as varied under Division 8 in the same way that it
applies to a workplace agreement.
36. One effect of this is that the fairness test applies to agreements as varied, even if the original
agreement was made before 7 May 2007, where a variation to the agreement modifies or
excludes one or more protected award conditions. This is important because under the Act
agreements can continue to operate after their nominal expiry date.
Section 346C - When protected award conditions apply to an employee
37. Proposed section 346C would outline the circumstances in which protected award
conditions apply to an employee whose employment is subject to a workplace agreement.
38. Proposed paragraph 346C(1)(a) would provide that if:
· the employee's employment is subject to a workplace agreement; and
· but for that agreement (or a previous agreement or other industrial instrument), the
protected award conditions would have effect in relation to the employee's employment
under a relevant award that was binding on the employee's employer,
the protected award conditions applying to the employee would be derived from the relevant
award.
39. Proposed paragraph 346C(1)(b) would provide that, where there is no relevant award, but an
award is designated, and:
· the employee's employment is subject to a workplace agreement; and
· the protected award conditions would have effect in relation to the employee's
employment if assuming that a designated award was binding on the employee's employer,
but for that agreement (or a previous agreement or other industrial instrument),
the protected award conditions applying to the employee under the designated award would be
taken to apply.
40. Proposed subsection 346C(2), together with proposed section 346H, deal with the manner in
which protected award conditions apply to an agreement where an award has been designated.
41. Under the existing Act, protected award conditions apply to parties bound by an award,
unless a workplace agreement expressly excludes or modifies them.
42. Under proposed Division 5A, an agreement that excludes or modifies protected award
conditions will (if other prerequisites are met) be subject to the fairness test.
43. However, where the parties are not bound by an award, and they have not yet sought a
designated award, their agreement may not expressly exclude or modify protected award
conditions, even though the intent of the parties was to change the award entitlements. The
effect of this would be that the agreement would not be subject to the fairness test.
44. To ensure that such an agreement remains subject to the fairness test, proposed section 346H
provides that a workplace agreement is taken to modify or exclude protected award conditions
that apply to an employee or employees under a designated award if the condition or conditions:
· do not have effect under the agreement; or
· have a different effect under the agreement than they would have under the designated
award.
Senate page 9 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
45. In order for this to be effective, it is also necessary to ensure that existing section 354 does
not deem protected award conditions in to the agreement. This is the effect of proposed
subsection 346C(2).
Section 346D - Application of Division to workplace agreements
46. Proposed section 346D would ensure the application of new Division 5A to workplace
agreements that have ceased operation (for example, because they have been terminated under
Division 9 of Part 8). This is a machinery provision necessary for the purpose of new
Subdivision D, which deals with the consequences of a workplace agreement not passing the
fairness test. Proposed section 346D ensures that such an agreement that has ceased to operate
must still be tested. This is important because compensation may still be payable in respect of
the period that an agreement was in operation, if the agreement does not pass the fairness test.
47. Proposed subsection 346D(3) would ensure that a reference to an employee is taken to
include a reference to a future employee.
Subdivision B - Workplace agreements to which the fairness test applies
Section 346E - Workplace Authority must apply the fairness test to certain workplace
agreements
48. Proposed section 346E would outline the circumstances in which the Workplace Authority
is obliged to decide whether an AWA or a collective agreement passes the fairness test set out in
proposed section 346M.
49. Proposed subsection 346E(1) would provide that the Workplace Authority must decide
whether an AWA passes the fairness test if:
· the AWA is lodged on or after 7 May 2007 (proposed paragraph 346E(1)(a)); and
· on the date the agreement is lodged, the employee is employed in an industry or
occupation which the terms and conditions of the kind of work performed by the employee
are usually regulated by an award (proposed paragraph 346E(1)(b)); and
· on the date the agreement is lodged, the employee has an annual rate of salary (or full-time
equivalent rate of salary) of less than $75,000 (for full-time employees paid a piece rate of
pay and employees other than full-time employees, the full-time or full-time equivalent
annual salary is to be calculated in accordance with proposed section 346G) (proposed
paragraph 346E(1)(c)); and
· the AWA modifies or excludes one or more protected award conditions that apply to the
employee under a reference award in relation to the employee (proposed paragraph
346E(1)(d)).
Senate page 10 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Example 1:
Jack is an electrician employed on a casual basis by Quality Electronics Pty Ltd that is bound by
a federal award. Jack approved an AWA with his employer which was lodged with the
Workplace Authority on 8 May 2007. Under the terms of his AWA, Jack's hourly rate of pay is
$35 per hour (including a casual loading of 20 per cent). There is no provision for the payment
of penalty rates on public holidays in the agreement, as is the case under his award.
Applying the requirements of proposed subsection 346E(1), the Workplace Authority is required
to decide whether Jack's AWA passes the fairness test.
· Jack's AWA was lodged after 7 May 2007 (on 8 May 2007).
· As an electrician, Jack is employed in an industry or occupation in which the terms and
conditions of the kind of work he performs are usually regulated by an award.
· Based on his hourly rate of pay of $35, if Jack were a full-time employee (working 38
hours per week), his annual rate of pay would be $69,160 (calculated at $35 x 38 hours x
52 weeks) which is less than $75,000.
· Jack's AWA does not provide for the payment of penalty rates on public holidays as is the
case under his award, meaning that the agreement excludes this protected award condition.
Example 2:
Nick is a part-time employee of Mick's Motor Mechanics Pty Ltd. Nick and Mick's Motor
Mechanics approved an AWA and then lodged it with the Workplace Authority in August 2007.
Under the terms of his AWA, Nick works 20 hours per week at a rate of pay of $45 per hour.
Based on an hourly rate of pay of $45, if Nick was a full-time employee (working 38 hours per
week), his annual rate of pay would be $88,920 (calculated at $45 x 38 hours x 52 weeks). On
the date the agreement was lodged, his pro-rata annual rate of salary was greater than $75,000.
Therefore, because of proposed paragraph 346E(1)(c), the Workplace Authority is not required
to decide whether Nick's AWA passes the fairness test.
50. Proposed subsection 346E(2) would provide that the Workplace Authority must decide
whether a collective agreement passes the fairness test if:
· the agreement is lodged on or after 7 May 2007 (proposed paragraph 346E(2)(a)); and
· on the date the agreement is lodged, one or more of the employees whose employment is
subject to the agreement is employed in an industry or occupation in which the terms and
conditions of the kind of work performed by the employee are usually regulated by an
award (proposed paragraph 346E(2)(b)); and
· the agreement modifies or excludes one or more protected award conditions that apply to
one of more of those employees under a reference award in relation to the employee or
employees (proposed paragraph 346E(2)(c)).
51. There is no monetary threshold for collective agreements.
Section 346F - Workplace Authority Director must apply the fairness test to certain
workplace agreements as varied
52. Proposed section 346F would outline the circumstances in which the Workplace Authority is
obliged to decide whether an AWA or a collective agreement as varied under Division 8 of Part
8 (the agreement making provisions of the Act) passes the fairness test.
Senate page 11 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
· In conjunction with proposed subsection 346B(3) (which would deem all references to
workplace agreements to include variations to workplace agreements), proposed
section 346F would limit the ability of parties to avoid the fairness test by varying old
agreements rather than making new ones.
53. Proposed subsection 346F(1) would provide that the Workplace Authority must decide
whether an AWA (as varied under Division 8) passes the fairness test if:
· the variation of the AWA is lodged on or after 7 May 2007 (proposed paragraph
346F(1)(a)); and
· on the date the variation of the agreement is lodged, the employee is employed in an
industry or occupation in which the terms and conditions of the kind of work performed by
the employee are usually regulated by an award proposed paragraph 346F(1)(b)); and
· on the date the variation of the agreement is lodged, the employee has an annual rate of
salary (or full-time equivalent rate of salary) of less than $75,000 (for full-time employees
paid a piece rate of pay and employees other than full-time employees, the full-time or full-
time equivalent annual salary is to be calculated in accordance with proposed section
346G) (proposed paragraph 346F(1)(c)); and
· the variation of the AWA modifies or excludes one or more protected award conditions
that apply to the employee under a reference award in relation to the employee (proposed
paragraph 346F(1)(d)).
54. Proposed subsection 346F(2) would provide that the Workplace Authority must decide
whether a collective agreement (as varied under Division 8) passes the fairness test if:
· the variation of the agreement is lodged on or after 7 May 2007 (proposed paragraph
346F(2)(a));
· on the date the variation of the agreement is lodged, one or more of the employees whose
employment is subject to the agreement as varied is employed in an industry or occupation
in which the terms and conditions of the kind of work performed by the employee are
usually regulated by an award (proposed paragraph 346F(2)(b));
· the variation of the agreement modifies or excludes one or more protected award
conditions that apply to one of more of those employees under a reference award in
relation to the employee or employees (proposed paragraph 346F(2)(c)).
Section 346G - Provisions about annual rate of salary
55. Proposed section 346G would contain a number of machinery provisions relating to the
calculation of the annual rate of salary under proposed sections 346E and 346F. These
provisions are necessary because an AWA with an annual rate of salary of less than $75,000 (or
the full-time equivalent) is subject to the fairness test.
56. Proposed subsection 346G(1) would allow regulations to be made that increase the annual
rate of salary below which an AWA would be subject to the fairness test. The annual rate of
salary cannot be decreased by the regulations.
57. The remaining provisions would prescribe the manner of calculating an employee's annual
rate of salary for the purposes of proposed paragraphs 346E(1)(c) and 346F(1)(c).
58. Proposed subsection 346G(2) would provide that, for an employee other than a full-time
employee (for example a part-time or casual employee) who is paid a periodic rate of pay (that
is, a rate of pay for a period worked, for example, weekly or fortnightly), the full-time equivalent
amount of salary for the purposes of proposed subparagraphs 346E(1)(c)(iii) or 346F(1)(c)(iii) is
Senate page 12 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
the salary the employee would earn if the employee were employed on a full-time basis and paid
at their periodic rate of pay.
59. For the purpose of proposed subsection 346G(2), proposed subsection 346G(3) would
provide that the salary the employee would earn is to be calculated for the 12 month period
beginning on the date the AWA is lodged.
60. Proposed subsection 346G(4) would provide that, for a full-time employee who is paid a
piece rate of pay (a rate of pay that is expressed as a rate for a quantifiable output or task -- as
opposed to being expressed as a rate for a period worked), the employee's full time salary for the
purposes of proposed subparagraphs 346E(1)(c)(ii) or 346F(1)(c)(ii) is the salary that the
employer reasonably estimates the employee would earn.
61. Proposed subsection 346G(5) would provide that, for an employee who is not a full-time
employee who is paid a piece rate of pay, the full time equivalent amount of salary for the
purposes of proposed subparagraphs 346E(1)(c)(iii) or 346F(1)(c)(iii) is the salary that the
employer reasonably estimates the employee would earn if the employee were employed on a
full-time basis.
62. Proposed subsection 346G(6) would allow regulations to be made that prescribe a method or
methods by which an employer may reasonably estimate the salary of an employee who is paid a
piece rate of pay for the purposes of proposed subsections 346G(4) and (5). A method or
methods may be prescribed in relation to classes of employees who are paid piece rates of pay,
by the kind of work performed by such employees, or otherwise.
63. For the purpose of subsections 346G(4) and (5), proposed subsection 346G(7) would
provide that the salary the employee would earn is to be estimated for the 12 month period
beginning on the date the AWA is lodged.
64. Proposed subsection 346G(8) would allow regulations to be made that prescribe a different
definition of salary for an employee who is paid a piece rate of pay for the purposes of proposed
subparagraphs 346E(1)(c) or 346F(1)(c).
Section 346H - Protected award conditions and designated awards -- deemed exclusion or
modification
65. Proposed section 346H is a deeming provision that would clarify the circumstances in which
an AWA or collective agreement is taken to exclude or modify protected award conditions that
apply to an employee or employees under a designated award for the purposes of subparagraphs
346E(1)(d), 346F(1)(d), 346E(2)(c) and 346F(2)(c).
66. Under existing section 354, if:
· a workplace agreement is lodged; and
· but for the agreement, protected award conditions would apply (i.e. because
an award bound the employer and employees before the agreement was lodged); and
· the agreement is silent with respect to those protected award conditions
then the protected award conditions are taken to be included in the agreement. By contrast, the
protected award conditions do not have effect if the agreement expressly excludes or modifies
them.
67. Under existing section 354, where the parties to the agreement are not bound by an award,
protected award conditions do not apply. A workplace agreement would not need to expressly
exclude or modify these conditions in order for them not to have effect.
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68. However, under the proposed fairness test arrangements, even though the parties are not
bound by a relevant award, their agreement may still be subject to the fairness test if (among
other things) the agreement applies to work in an industry or occupation that is usually regulated
by an award, and the agreement excludes or modifies protected award conditions.
· The award against which such an agreement would be tested would be the award
designated by the Workplace Authority for the purpose of the fairness test. Such an award
can be designated in advance by the Workplace Authority on application by an employer
under proposed section 346K. This section would enable (but not compel) an employer to
ascertain before making an agreement what protected award conditions are applicable, and
make provision in the agreement about the extent to which those conditions apply, or about
the compensation to be provided in lieu of thereof.
69. If an employer (that is not bound by a relevant award) lodges an agreement that is silent
about protected award conditions, proposed section 346H would ensure that the agreement
remains subject to the fairness test, even though it does not expressly exclude or modify those
conditions.
70. This section would provide that a workplace agreement is taken to exclude or modify
protected award conditions that apply to an employee or employees under a designated award if
the condition or conditions:
· do not have effect under the agreement; or
· have a different effect under the agreement than they would have under the designated
award.
- So, for example, if an employer who is not bound by a relevant award lodges an
agreement that is silent about protected award conditions, those conditions do not have
effect under the agreement. Under section 346H the agreement is taken to exclude the
protected award conditions, and the fairness test applies.
71. Proposed subsection 346C(2) is also relevant to how proposed section 346H operates.
Section 346J - Notice requirements
72. Proposed section 346J would outline the Workplace Authority's obligations to notify
relevant parties about whether the Workplace Authority is or is not required to apply the fairness
test to a workplace agreement.
73. Proposed subsection 346J(1) would provide that, if the Workplace Authority is required to
decide whether a workplace agreement passes the fairness test, the Director must give written
notice to that effect to the following parties:
· the employer in relation to the workplace agreement (proposed paragraph 346J(1)(a)); and
· if the agreement is an AWA -- the employee whose employment is subject to the AWA
(proposed paragraph 346J(1)(b)); and
· if the agreement is a union collective agreement or a union greenfields agreement -- the
organisation or organisations bound by the agreement (proposed paragraph 346J(1)(c)).
74. Proposed subsection 346J(2) would provide that, if the Workplace Authority is not required
to decide whether a workplace agreement passes the fairness test, it must give written notice to
that effect to the parties listed in proposed subsection 346J(1). This ensures that parties are made
aware of the Workplace Authority's decisions about the application of the fairness test to the
agreement.
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75. Proposed subsection 346J(3) would clarify that a written notice given under this section is
not required to be given at the same time as the copy of the receipt is given under existing
section 345 in respect of the lodgment of a declaration for the workplace agreement concerned.
76. The note under proposed subsection 346J(3) would inform readers that where the agreement
is a collective agreement, proposed section 346ZE requires that employers given notice under
this section must inform employees of the contents of the notice. This is consistent with the
approach taken for other notification requirements in relation to collective agreements under
Part 8 (for example, existing section 346).
Section 346K - Designated awards - before a workplace agreement or variation is lodged
77. Proposed section 346K would prescribe the circumstances in which the Workplace
Authority may determine that an award is a designated award in relation to an AWA or
collective agreement that is yet to be lodged or varied.
78. Proposed subsection 346K(1) would enable an employer to apply to the Workplace
Authority to make a determination designating an award in relation to an employee or employees
of that employer.
79. However, under proposed subsection 346K(2), the Workplace Authority would only be able
to make such determination if the Director is satisfied that:
· the employee works in an industry or occupation in which the terms and conditions of the
kind of work to be performed are usually regulated by an award; and
· there is no other award that was binding on the employer immediately before the day on
which the workplace agreement was lodged that regulates any term or condition of
employment of persons performing the same kind of work (that is, there is no relevant
award within the meaning of proposed section 346B).
80. Proposed subsection 346K(3) would limit the type of awards that the Workplace Authority
may designate to:
· an award or awards regulating (or that would, but for a workplace agreement or other
industrial instrument, regulate) the terms or conditions of employment of employees
engaged in the same kind of work as that to be performed by the employee or employees
(proposed paragraph 346K(3)(a));
· an award or awards that would be appropriate the purposes of proposed section 346L if a
workplace agreement or a variation were to be lodged (proposed paragraph 346K(3)(b));
· an award that is not an enterprise award (proposed paragraph 346K(3)(c)).
81. The question of whether there is an appropriate award is a matter for the Workplace
Authority. A note to proposed subsection 346K(3) would provide an example of a case where
the Workplace Authority may consider that there is not an appropriate award. This would be
where an award regulates terms and conditions of the kind of work to be performed by an
employee in an industry or occupation in one State only, but terms and conditions of that kind of
work are not regulated by awards in other States.
82. As noted, proposed paragraph 346K(3)(c) would provide that the Workplace Authority must
not determine an enterprise award for the purposes of section 346K. Enterprise awards are
excluded because they bind a specific employer and are typically tailored to the circumstances of
that employer. Such an award is not an appropriate basis for assessing a workplace agreement
made by another employer.
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83. Where the Workplace Authority makes a determination designating an award under
proposed subsection 346K(2) prior to a workplace agreement or a proposed variation being
lodged, the award designated would be used to apply the fairness test if that workplace
agreement or variation was subsequently lodged (proposed subsection 346K(4)) unless the
Workplace Authority considers that circumstances have changed. In this situation, the
Workplace Authority would designate another award or awards under proposed section 346L
(proposed subsection 346K(5)).
84. The Workplace Authority may designate different awards in respect of different employees
(proposed subsection 346K(6)). For example, if the scope of the proposed workplace agreement
regulates the terms and conditions of employment of cleaners and clerical staff, the Workplace
Authority may designate an award that is appropriate to regulate the terms and conditions of
employment for cleaners, and another award that is appropriate to regulate the terms and
conditions of employment for the clerical staff.
85. Proposed subsection 346K(7) would ensure that, for the purpose of this section, any
reference to an employee or employees of an employer includes future employees of that
employer. This is necessary to ensure that an award may be designated by the Workplace
Authority for a new venture where there are not yet any employees at the time the application for
designation of an award is made.
86. Proposed subsection 346K(8) makes clear that a determination made by the Workplace
Authority under section 346K is not a legislative instrument. This is not a substantive provision;
rather, it is included to assist readers, as a determination under this section would not be a
legislative instrument within the meaning of section 5 of the Legislative Instruments Act 2003.
Section 346L - Designated awards - after a workplace agreement or variation is lodged
87. Proposed section 346L sets out the circumstances in which the Workplace Authority is
required to determine that an award is a designated award in relation to a workplace agreement
(or variation) that has been lodged.
88. Proposed subsection 346L(1) would set out when section 346L would apply (that is, in
relation to agreements to which the fairness test applies).
89. Proposed subsection 346L(2) would provide that the Workplace Authority must determine a
designated award to ascertain whether it is require to apply the fairness test (that is, does it
exclude or modify protected award conditions) and, if so, whether the agreement passes the
fairness test.
90. Proposed subsection 346L(3) would limit the type of award that the Workplace Authority
may determine is a designated award under proposed subsection 346L(2) to an award that:
· regulates (or would regulate) the terms or conditions of employment of employees engaged
in the same kind of work as the work performed by the employee or employees under the
workplace agreement; and
· is an appropriate award in the opinion of the Workplace Authority; and
· is not an enterprise award.
91. Where the Workplace Authority has previously designated an award under section 346K,
that award is taken to have been designated for the purposes of section 346L unless the
Workplace Authority considers that the circumstances have changed in such a way that it is
necessary to designate another award.
92. Proposed subsection 346L(4) would allow the Workplace Authority to determine a different
designated award in relation to different employees.
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93. Proposed subsection 346L(5) would provide that a determination made by the Workplace
Authority under section 346L is not a legislative instrument. This is not a substantive provision;
rather, it is included to assist readers, as the instrument is not a legislative instrument within the
meaning of section 5 of the Legislative Instruments Act 2003.
Subdivision C - The fairness test
Section 346M - When does an agreement pass the fairness test?
94. Proposed section 346M would set out the fairness test.
95. In the case of an AWA, paragraph 346M(1)(a) would provide that the AWA passes the
fairness test if the Workplace Authority is satisfied that the AWA provides reasonable
compensation to the employee in lieu of the exclusion or modification of protected award
conditions.
96. In the case of collective agreements, paragraph 346M(1)(b) would provide that the
Workplace Authority is required to be satisfied that, on balance, the collective agreement
provides fair compensation, in its overall effect on employees bound to the agreement, in lieu of
the exclusion or modification of protected award conditions that apply to some or all of those
employees. This modified approach for collective agreements reflects the fact that the test must
be applied to a number of employees.
97. Proposed subsection 346M(2) would set out the principal factors that the Workplace
Authority must have regard to in determining whether a workplace agreement provides fair
compensation to the employee or employees and passes the test. These factors are:
· the monetary and non-monetary compensation that the employee or employees will receive
under the workplace agreement, in comparison to the protected award conditions that apply
to the employee or employees under a reference award; and
· the work obligations of the employee or employees under the workplace agreement (for
example, the rostering arrangements or shift patterns of the employee or employees).
98. Proposed subsection 346M(3) would provide that, in addition to the factors in proposed
subsection 346M(2), the Workplace Authority may also have regard to the personal
circumstances of the employee or employees, particularly their family responsibilities, in
considering whether an workplace agreement meets the test. This would enable factors such as
flexible working hours to be considered. However, it would not enable the Workplace Authority
to look at any period of unemployment of the employee or employees - which may only be
considered in exceptional circumstances, and where it is not contrary to the public interest to do
so, under proposed subsection 346M(4) (outlined further below).
Example 1:
Jason is a salesman employed by Shiny Trinkets Pty Ltd. He is currently employed under an
award that provides for the payment of penalty rates and overtime loadings. Jason's employer
recently offered him an AWA, which he accepts. Under the terms of the proposed AWA,
Jason's employer would meet the cost of child care for his children. The AWA expressly
excludes the payment of penalty rates or overtime loadings, which are payable under Jason's
award. However, the annual value of his child care payments is greater than the value of the
penalty rates and overtime loadings that Jason would have expected to earn. No other changes
are made to Jason's terms and conditions. As Jason's annual rate of salary is less than $75,000,
the Workplace Authority is obliged to decide whether Jason's agreement passes the fairness test.
Under proposed subsection 346M(1), Jason's AWA would pass the fairness test if the Workplace
Authority is satisfied that the AWA provides fair compensation in lieu of the exclusion or
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modification of protected award conditions. When determining whether Jason's AWA provides
fair compensation, the Workplace Authority would consider:
· the monetary and non-monetary compensation Jason will receive under his AWA, in
comparison to the protected award conditions under the reference award; and
· Jason's work obligations under the AWA.
The Workplace Authority may consider whether the payment of child care offsets the removal of
his penalty rates and overtime loadings. In order to do this, the Workplace Authority may take
into account Jason's usual work pattern to determine the penalty rates and overtime loadings he
would have been entitled to receive under his award.
After considering these factors, the Workplace Authority would make a decision about whether
Jason's AWA passes the fairness test. Given that the annual value of his child care payments is
greater than the amount of penalty rates and overtime loadings that Jason would have expected
to earn, it would be open to the Workplace Authority to conclude that Jason's AWA passes the
fairness test.
Example 2:
Reliable Plant Repairs is bound by a federal award. The employees of Reliable Plant Repairs
approved a collective agreement made by the employer and the relevant union. The collective
agreement provides for an increased rate of pay in return for the removal of penalty rates as well
as travel, uniform and shift allowances which are payable under this award.
The Workplace Authority is obliged to decide whether the collective agreement passes the
fairness test.
The collective agreement would pass the fairness test if the Workplace Authority is satisfied that
the agreement provides fair compensation in lieu of the exclusion or modification of protected
award conditions. When determining whether the agreement provides fair compensation, the
Workplace Authority would consider:
· the monetary and non-monetary compensation the employees will receive under the
agreement, in comparison to the protected award conditions under the reference award; and
· the employees' work obligations under the agreement.
For example, the Workplace Authority may consider whether the increased rate of pay offsets
the removal of penalty rates as well as the shift and other allowances. In order to do this, the
Workplace Authority may take into account employees' usual shift patterns to determine the
shift allowances they would normally be entitled to receive under the award. The Workplace
Authority may also have regard to the personal circumstances of the employees covered by the
agreement.
After considering these factors, the Workplace Authority would make a decision about whether
the collective agreement passes the fairness test. If the Workplace Authority is satisfied that the
agreement in its overall effect on employees (including increased rates of pay) provides fair
compensation to offset the removal of protected award conditions, it would be open to the
Workplace Authority to conclude that the collective agreement passes the fairness test.
Example 3:
Jaimee is a salesperson employed by Music Heaven, a music retailer in Sydney's CBD. She is
currently employed under an award that provides for the payment of penalty rates for work
performed on Sundays.
Jaimee asks her employer to enter into AWA. Under the terms of the proposed AWA, Jaimee's
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employer would provide her with a permanent car-parking space. In exchange, the AWA
expressly excludes the payment of penalty rates for work performed on Sundays, which are
payable under Jaimee's award. The car-parking space is non-monetary compensation for the
removal of these protected award conditions. Because of the location of the business, the annual
value of the car-parking space is greater than the value of the penalty rates that Jaimee would
have received under the award. The employer agrees to Jaimee's request because of the extra
flexibility the AWA would give to open on Sundays. Jaimee's annual salary is less than
$75,000. No other protected award conditions have been modified. The AWA is lodged with the
Workplace Authority.
After considering the factors set out in proposed subsections 346M(2) and (3), the Workplace
Authority would make a decision about whether Jaimee's AWA passes the fairness test. Given
that the annual value of her car-parking space is greater than the value of the penalty rates that
Jaimee would have expected to earn, and no other changes are made to work conditions, it would
be open to the Workplace Authority to conclude that Jaimee's AWA passes the fairness test.
Example 4:
Joel is a plumber employed by Water Wise Pty Ltd. Joel and Water Wise made an AWA which
was lodged with the Workplace Authority in June 2007.
Joel has 2 young children and wants to finish work at 3pm on weekdays. Joel's wife, Mindy, has
recently returned to full-time work as an engineer. The ability to collect the children from
school is very important to Joel who places great value in being able to pick up his children from
school. Joel and his employer agreed that, in exchange for Joel being able to leave work at 3pm,
he will work on Saturdays at his ordinary time rate of pay (removing the award entitlement to
penalty rates for weekend work). Joel's annual salary under the AWA is less than $75,000.
In considering whether Joel's AWA would pass the fairness test in this case the Workplace
Authority would need to have regard to Joel's personal circumstances, particularly his family
responsibilities.
If the Workplace Authority is satisfied that the increased flexibility in working hours Joel enjoys
under his AWA provides fair compensation for the exclusion of penalty rates for Saturday work,
it would be open to the Workplace Authority to decide that Joel's AWA passes the fairness test.
Example 5:
Zita is an administrative officer employed by a mailing list company. Her work is mostly
computer based.
Zita has two children of school age and wants to drop them off at school and be at home when
they arrive after school. She enters into an AWA with her employer that enables her to alter her
start and finish times, and perform work from home after her children have gone to bed. In
exchange, the AWA excludes the penalty rates that would have been payable under the relevant
award.
Zita agrees to the AWA because of the extra flexibility it gives her to balance her work and
family life.
In considering whether Zita's AWA would pass the fairness test in this case the Workplace
Authority would need to have regard to her personal circumstances, particularly her family
responsibilities.
If satisfied that the increased flexibility in working hours Zita enjoys under her AWA provides
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fair compensation for the exclusion of penalty rates, it would be open to the Workplace
Authority to decide that Zita's AWA passes the fairness test.
99. In exceptional circumstances, and provided it is not contrary to the public interest to do so,
proposed subsection 346M(4) would allow the Workplace Authority to have regard to the
industry, location or economic circumstances of the employer and the employment
circumstances of the employee. This consideration would apply in addition to the matters
specified in proposed subsections 346M(2) and (3).
100. Proposed subsection 346M(5) sets out an example for the purposes of subsection 346M(4)
of a case where the Workplace Authority may be satisfied that it is not contrary to the public
interest to have regard to the industry location or economic circumstances of the employer. The
example is where the workplace agreement is part of a reasonable strategy to deal with a short-
term crisis in, and to assist in the revival of, the employer's business. This reflects the example
that applied to the former no-disadvantage test.
Example 1:
David is employed as a waiter at Bill's Steakhouse. He is required to work evenings and
weekends. David and Bill's Steakhouse made an AWA, which has been lodged with the
Workplace Authority. The AWA provides for an hourly rate of pay slightly higher than David
would receive under the pay scale derived from the award but reduces the penalty rates than
David would be entitled to under the pay scale. Based on his usual shift pattern, David will earn
less under the AWA than he would with penalty rates under the award.
David was out of work for more than one year prior to accepting this job and he lives in a
regional area where there are limited jobs. He has just started a full-time TAFE course in
hospitality. This job is particularly suitable for David as he is still able to attend TAFE and is
gaining experience that is relevant to his course.
Under proposed subsection 346M(1), David's AWA would pass the fairness test if the
Workplace Authority is satisfied that the AWA provides fair compensation in lieu of the
exclusion or modification of protected award conditions. If the Workplace Authority is not
satisfied that the agreement provides fair compensation for the removal of protected award
conditions having regard to:
· the monetary and non-monetary compensation David will receive under his AWA, in
comparison to the protected award conditions under the reference award;
· David's work obligations under the AWA; and
· David's personal circumstances, including family responsibilities,
the agreement will generally not pass the fairness test.
However, it is only if there are exceptional circumstances and it is not contrary to the public
interest to do so, that the Workplace Authority may also consider the industry, location or
economic circumstances of the employer and the employment circumstances of the employee.
Example 2:
Rick owns a farming supplies company in a regional town. His business is severely affected by
the drought and is struggling financially.
Joan is employed by Rick's company as an administrative assistant under the terms of an award.
Because of his financial difficulties, Rick draws up a restructuring plan to ensure the viability of
the business over the next 2 years. He discusses his situation with Joan, and they agree to enter
into a short-term AWA. The AWA excludes penalty rates and allowances that Joan would be
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entitled to under her award. Despite this, Joan agrees to the AWA because she wants to assist
Rick's business to get out of its financial difficulties, and there are not many other employment
opportunities in the town. The AWA provides that the agreement will cease to operate 2 years
after lodgment.
If the Workplace Authority is not satisfied that the agreement provides fair compensation in lieu
of the removal of protected award conditions having regard to:
· the monetary and non-monetary compensation Joan will receive under her AWA, in
comparison to the protected award conditions under the reference award;
· Joan's work obligations under the AWA; and
· Joan's personal circumstances, including family responsibilities,
the agreement will generally not pass the fairness test.
However, if there are exceptional circumstances and it is not contrary to the public interest to do
so, the Workplace Authority may also consider the industry, location or economic circumstances
of the employer and the employment circumstances of the employee. In this case, if there are
exceptional circumstances and it is not contrary to the public interest to do so, the Workplace
Authority would need to consider whether the employment agreement provides fair
compensation to Joan having regard to the short term business difficulties that Rick's business
faces and Joan's employment circumstances.
101. Proposed subsection 346M(6) would confer a broad discretion on the Workplace Authority
to inform itself about whether an agreement passes, or does not pass, the fairness test. For
example, the Workplace Authority may contact the employer or any employee who is subject to
the agreement by phone to ask questions about an agreement that has been lodged. This ensures
that the Workplace Authority can seek sufficient information to make a decision as to whether or
not a workplace agreement passes the fairness test.
102. Proposed subsection 346M(7) would provide a definition of non-monetary compensation
for the purpose of applying the fairness test. Non-monetary compensation would encompass
compensation that:
· has a money equivalent or to which a money value can be assigned (for example a car-
parking space, child care or shares in the employer's company); and
· confers a benefit or advantage on the employee which is of significant value to the
employee.
103. This definition is intended to ensure that protected award conditions cannot be excluded or
modified by a workplace agreement in exchange for non-monetary compensation that is of little
or no value to the employee or employees subject to the agreement. It would be expected, for
example, that meals (such as a pizza at the end of a shift) would not constitute adequate
compensation for removal of protected award conditions.
Section 346N - Agreements to be tested as at lodgment date
104. Proposed subsections 346N(1) and (2) would make clear that in deciding whether an
agreement or an agreement as varied passes or does not pass the fairness test, the Workplace
Authority must consider the workplace agreement or agreement as varied as in force
immediately after lodgment.
105. Proposed subsection 346N(3) would deal with the situation where a workplace agreement
is lodged and a subsequent variation to that agreement is lodged before the Workplace Authority
decides whether the original agreement passes or does not pass the fairness test.
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106. Proposed subsection 346N(3) would provide that if:
· the Workplace Authority is required to decide whether a workplace agreement passes the
fairness test; and
· before it decides, a variation to that agreement is lodged and the Workplace Authority is
required (under proposed section 346F) to determine whether the agreement as varied
passes the fairness test;
then the Workplace Authority must consider the workplace agreement and the workplace
agreement as varied as part of the same process.
107. However, the Workplace Authority would be required to make a separate decision in
respect of the workplace agreement and the workplace agreement as varied. This is because the
variation may affect the extent to which an employee may be entitled to compensation under
proposed section 346ZD. This is necessary as different entitlements to compensation may flow
from each decision.
Section 346P - Workplace Authority Director must notify of decision
108. Proposed section 346P would outline the Workplace Authority's obligations to notify
relevant parties about whether a workplace agreement passes the fairness test.
109. Proposed subsection 346P(1) would provide that, if the Workplace Authority decides that a
workplace agreement passes the fairness test, the Director must give notice of his or her decision
to the following parties:
· the employer in relation to the workplace agreement (proposed paragraph 346P(1)(a)); and
· if the agreement is an AWA -- the employee whose employment is subject to the AWA
(proposed paragraph 346P(1)(b)); and
· if the agreement is a union collective agreement or a union greenfields agreement -- the
organisation or organisations bound by the agreement (proposed paragraph 346P(1)(c)).
110. Proposed subsection 346P(2) would provide that, if the Workplace Authority decides that a
workplace agreement does not pass the fairness test, it must give notice of its decision to the
parties listed above.
111. Proposed subsection 346P(3) would provide that, if the Workplace Authority decides that a
workplace agreement does not pass the fairness test, the Director must also:
· for a workplace agreement that is operating on the date of issue specified in the notice --
provide advice about how the agreement could be varied in order to pass the fairness test;
and
· state that compensation may be payable by the employer to the employee or employees in
accordance with proposed section 346ZD.
112. If proposed subsection 346N(3) requires the Workplace Authority to consider and make a
decision in relation to a workplace agreement and the workplace agreement as varied as part of
the same process, proposed subsection 346P(4) would require that the notice provided by the
Workplace Authority deal with both agreements.
113. Proposed subsection 346P(5) would provide that a notice given under this section must be
in writing and specify the date of issue of the notice. The date of issue of the notice is relevant in
calculating compensation payable (if any) under proposed section 346ZD.
114. The note under proposed subsection 346P(5) would inform readers that where the
agreement is a collective agreement, section 346ZE requires that employers given notice under
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this section must inform employees of the contents of the notice. This is consistent with the
approach taken for other notification requirements in relation to collective agreements under Part
8 (for example, section 346).
Subdivision D - Consequences if a workplace agreement does not pass the fairness test
115. Proposed Subdivision D would set out the consequences of a decision by the Workplace
Authority under section 346M that a workplace agreement does not pass the fairness test.
Section 346Q - Agreement does not pass fairness test -- agreement not in operation
116. Proposed section 346Q would deal with the situation where the workplace agreement has
ceased to operate in relation to any employee before the date of the decision by the Workplace
Authority that the workplace agreement does not pass the fairness test. For example, this could
happen where the agreement is terminated before the agreement is tested.
117. In this situation, the employee or employees whose employment was subject to the
workplace agreement may have an entitlement to compensation under proposed section 346ZD
in respect of any period they were subject to the agreement. Note that the Workplace Authority
must test an agreement that has ceased operation (proposed subsection 346D(1)).
Section 346R - Agreement does not pass fairness test - agreement in operation
118. Proposed section 346R would deal with the situation where the workplace agreement is in
operation immediately before the date of a decision by the Workplace Authority that the
workplace agreement does not pass the fairness test.
119. Proposed subsection 346R(1) sets out the circumstances in which the provision would
apply.
120. Proposed subsection 346R(2) would provide the employer with an opportunity to vary the
AWA or collective agreement (the Workplace Authority would provide advice about how the
agreement could be varied to pass the fairness test) (see proposed section 346P).
· For the purposes of section 346R, a variation may be made by the employer providing the
Workplace Authority with a written undertaking. An undertaking is taken to be a variation
of the agreement (see proposed subsection 346T(3)). This reflects the arrangements that
were in place under the previous no disadvantage test.
· If the agreement is an AWA, the employer may either lodge a variation of the AWA or a
written undertaking. In order to expedite the agreement-making process, a variation for the
purposes of new subsection 346R(2) is not required to comply with all of the usual
procedural requirements that apply to variations under Division 8 of Part 8 - see proposed
subsections 346R(5) and (6). However, a variation to an AWA must be signed and
witnessed by the parties, and, where the employee is under 18, signed and witnessed by an
appropriate person such as a parent or guardian.
121. If the employer lodges a variation or undertaking, the Workplace Authority must test the
varied agreement under section 346U.
122. Proposed subsection 346R(3) would provide that if the employer takes no action within the
relevant period the workplace agreement ceases to operate and the employee or employee whose
employment was at any time subject to the workplace agreement may have an entitlement to be
paid compensation under section 346ZD in respect of that period.
123. Proposed subsection 346R(4) would provide that if the Workplace Authority has made
separate decisions that:
· a workplace agreement did not pass the fairness test; but
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Schedule 1 - The Fairness Test
· the workplace agreement as varied did pass the fairness test
the workplace agreement as varied continues in operation.
124. Proposed subsection 346R(7) would define the relevant period as the period of 14 days
beginning on the date of issue specified in the notice that the agreement has not passed the
fairness test, or such other longer period that is prescribed by the regulations. The regulations
may also prescribe the circumstances in which the Workplace Authority may extend the relevant
period in relation to a particular workplace agreement
Section 346S - Lodging of variation documents with the Workplace Authority Director
125. Proposed section 346S would set out the procedural requirements for lodging a variation or
giving an undertaking as permitted by proposed section 346R.
126. Variation or an undertaking must be annexed to a declaration that meets the form
requirements Gazetted by the Workplace Authority. Variation and declaration must be received
by the Workplace Authority.
Section 346T - Operation of 346R variations
127. Proposed section 346T would provide rules about when variations made under proposed
subsection 346R(2) come into operation. These rules are necessary because not all of the
procedural requirements of Division 8 of Part 8 apply to variations under proposed subsection
346R(2).
128. Proposed subsection 346T(1) would provide that an AWA variation under paragraph
346R(2)(a) comes into operation when the variation is lodged with the Workplace Authority
under that paragraph in accordance with proposed section 346S. This means that the AWA is
lodged when the variation and accompanying declaration are received by the Workplace
Authority.
129. Proposed subsection 346T(2) would provide that a variation to an AWA or a collective
agreement by written undertaking under paragraph 346R(2)(b) comes into operation when the
undertaking is given to the Workplace Authority under that paragraph in accordance with
proposed section 346S. This means that the undertaking is given when the undertaking and
accompanying declaration are received by the Workplace Authority. Proposed subsection
346T(3) would provide that an undertaking is taken to be a variation to a workplace agreement.
Section 346U - Workplace Authority Director must test varied agreement
130. Proposed subsection 346U(1) would require the Workplace Authority to test any
workplace agreement that has been varied under section 346R and decide whether the workplace
agreement as varied passes the fairness test set out in proposed section 346M. Note that the
decision on the varied agreement is made under subsection 346U(1) - which means there is no
opportunity for further variation.
131. Proposed subsections 346U(2) and (3) would require the Workplace Authority to notify in
writing the following of its decision:
· in the case of all workplace agreements - the employer;
· in the case of an AWA - the employee whose employment is subject to the AWA; and
· in the case of a union collective agreement or a union greenfields agreement - the
organisation or organisations bound by the agreement.
132. Proposed subsection 346U(4) would require that such notice be in writing and specify the
date of issue of the notice. This requirement is relevant for determining the time a workplace
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Schedule 1 - The Fairness Test
ceases to operate if the varied agreement does not pass the fairness test (see proposed section
346W).
133. The note under proposed subsection 346U(4) would inform readers that where the
agreement is a collective agreement, section 346ZE requires that employers given notice under
this section must inform employees of the contents of the notice. This is consistent with the
approach taken for other notification requirements in relation to collective agreements under
Part 8 (for example, section 346).
134. Proposed subsection 346U(5) would confer a broad discretion on the Workplace Authority
to inform itself about whether an agreement passes, or does not pass, the fairness test. For
example, the Workplace Authority may contact the employer or any employee who is subject to
the agreement by phone to ask questions about an agreement that has been lodged. This ensures
that the Workplace Authority can be appropriately informed before making a decision as to
whether or not a workplace agreement passes the fairness test.
Section 346V - Effect if varied agreement does not pass fairness test - agreement not in
operation
135. Proposed section 346V would deal with the situation where the Workplace Authority
decides under subsection 346U(1) that a workplace agreement as varied does not pass the
fairness test and the workplace agreement is not in operation in relation to any employee
immediately before the date of the decision (for example, where an employee subject to an AWA
resigned before the variation was tested).
136. Despite the fact the agreement has ceased to operate, the employee or employees whose
employment was subject to the workplace agreement at any time it was in operation may have an
entitlement to compensation under section 346ZD in respect of that period. This is why
proposed section 346D requires the Workplace Authority to test an agreement even if it is no
longer in operation.
Section 346W - Effect if varied agreement does not pass fairness test - agreement in
operation
137. Proposed section 346W would provide that if the agreement as varied does not pass the
fairness test, the agreement ceases to operate on that date and the employee or employees whose
employment was subject to the workplace agreement at any time during its operation may have
an entitlement to compensation under section 346ZD in respect of that period.
Section 346X - Effect if varied agreement passes fairness test - agreement in operation
138. Proposed section 346X would provide that if the agreement as varied passes the fairness
test, the workplace agreement continues to operate and the employee or employees whose
employment is subject to the workplace agreement may have an entitlement to compensation
under section 346ZD in respect of the time they were subject to the agreement during the period
between the agreement being lodged and the variation being lodged (that is, the period when the
agreement did not pass the fairness test).
Section 346Y - Employment arrangements that apply if a workplace agreement ceases to
operate because it does not pass the fairness test
139. Proposed section 346Y would specify the employment arrangements that will apply to the
employer and the employee whose employment was subject to a workplace agreement in
circumstances where that workplace agreement ceases to operate because it has not passed the
fairness test under section 346R or section 346W.
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Schedule 1 - The Fairness Test
140. Proposed subsection 346Y(1) would apply when a workplace agreement ceases to operate
because it does not pass the fairness test. For the purposes of this section:
· the day on which a workplace agreement ceases to operate is referred to as the `cessation
day'; and
· the workplace agreement that ceases to operate is referred to as the `original agreement'.
141. Proposed subsection 346Y(2) would provide that, on and from cessation day, the parties
will be bound by the instrument or instruments that would have bound them but for the original
agreement having come into operation.
142. The term `instrument' is broadly defined in proposed subsection 346Y(5) to include a
workplace agreement, an award, a pre-reform AWA, a pre-reform certified agreement, a
workplace determination, a Victorian employment agreement, an exceptional matters order, a
section 170MX award and an old IR agreement. It is also possible that terms and conditions may
come from a preserved State agreement or notional agreements preserving State awards - these
instruments are dealt with in Schedule 8 to the Act (see items 41 and 42 of this Schedule).
Example 1:
Collective agreement AWA lodged AWA fails fairness test and
lodged ceases to operate
Collective agreement
operates
Henry started working for his employer in August 2006, and a collective agreement regulated the
employees' terms and conditions of employment. Henry subsequently approves an AWA, and it
is lodged with the Workplace Authority.
The Workplace Authority determines that Henry's AWA fails the fairness test. From this date
Henry's AWA ceases to operate, and Henry's terms and conditions are instead governed by the
instrument that, but for the AWA coming into operation, would have applied (ie as if the AWA
had not come into operation). Because Henry would have been bound by a collective agreement,
it applies.
Example 2:
Pre-reform AWA AWA lodged AWA fails fairness test and
ceases to operate
Pre-reform AWA
operates
Ollie is a part time bulldozer for Maggie's construction company - Princess Foundations Pty
Ltd. When Ollie started working for Maggie in July 2004, he made an AWA with Maggie. This
agreement continued to operate after its nominal expiry date (as a pre-reform AWA) and
Senate page 26 Workplace Relations Amendment
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Schedule 1 - The Fairness Test
regulated his terms and conditions of employment. In June 2007 Maggie and Ollie agree to
make a new AWA, and lodge it with the Workplace Authority.
The Workplace Authority determines that Ollie's new AWA does not pass the fairness test.
From this time Ollie's AWA ceases to operate, and Ollie's terms and conditions are instead
governed by the instrument that, but for the AWA coming into operation, would have applied (ie
as if the AWA had not come into operation). Ollie would therefore be subject to the pre-reform
AWA.
143. If under proposed subsection 346Y(1) the original agreement is a workplace agreement as
varied under Division 8 of Part 8, then the workplace agreement in force before the variation was
lodged is capable of being an instrument that binds the employer and an employee or employees
in relation to the terms and conditions of employment (proposed subsection 346Y(3)).
144. Proposed subsection 346Y(4) makes clear that, if an instrument has ceased operating
because the original agreement came into operation, it is still capable of being an instrument to
which an employer and employee or employees may be bound after the original agreement
ceases to operate because it has failed the fairness test. Part 2 of this Schedule contains
consequential amendments to relevant provisions of the Act that reflect this principle (see for
example items 5, 6 and 7).
145. Where there is no instrument of the kind specified in proposed subsection 346Y(5), on and
from cessation day, the parties will be bound by the protected award conditions contained in the
designated award (proposed paragraph 346Y(2)(b)).
146. This section does not affect the way, if any, in which the Australian Fair Pay and
Conditions Standard operates in relation to the relevant instrument.
Example 1:
Collective
agreement AWA Collective agreement AWA fails fairness
lodged lodged varied test
Collective agreement as
varied
In December 2006 Bells Consulting Pty Ltd lodged a collective agreement with the (former)
Office of the Employment Advocate. When Trixie started working for Bells Consulting in July
2007, she approved an AWA. On 23 July 2007, Bells Consulting lodges a variation to the
collective agreement with the Workplace Authority. As the variation does not modify protected
award conditions, the varied collective agreement is not subject to the fairness test.
The Workplace Authority determines that Trixie's AWA does not pass the fairness test. From
this date Trixie's AWA ceases to operate, and her terms and conditions are governed by the
instrument that, but for the AWA coming into operation, would have applied (ie as if the AWA
had not come into operation). As the collective agreement as varied would have applied to
Trixie, it governs her terms and conditions from this date.
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Schedule 1 - The Fairness Test
Example 2:
Pre-reform
certified
AWA lodged Collective agreement AWA fails but collective
agreement
lodged agreement passes fairness
operates
test
Collective
agreement
In December 2004 the Australian Industrial Relations Commission certified the Huender Pty Ltd
certified agreement. In August 2007, Bec starts working for Huender Pty Ltd, and approves an
AWA. Her AWA is lodged with the Workplace Authority. A week later Huender Pty Ltd
lodges a collective agreement with the Workplace Authority.
The Workplace Authority determines that Bec's AWA does not pass the fairness test. The
collective agreement does pass the fairness test. As a result Bec's AWA ceases to operate, and
from this date her terms and conditions are governed by the instrument that, but for the AWA
coming into operation, would have applied (that is, as if the AWA had not come into operation)
- in this case, the collective agreement.
Example 3:
Collective Collective agreement AWA AWA fails
agreement lodged terminated with lodged fairness test
undertakings
Undertakings and protected
award conditions from the
designated award
Liza works for Marina's Dental Care Pty Ltd (which is not a respondent to an award). Liza's
terms and conditions are determined by a collective agreement, which was lodged with the
(former) Office of the Employment Advocate on 20 April 2006, and had a nominal expiry date
of 20 April 2007. Marina's Dental Care decides to unilaterally terminate the collective
agreement (after its nominal expiry date has passed), and makes undertakings to the employees
bound by the agreement to preserve rates of pay and some other conditions in the agreement
after its termination. These are lodged with the (former) Office of the Employment Advocate on
23 April 2007. Liza, having just finished her studies to qualify as a dentist, negotiates an AWA
with Marina's Dental Care, and it is lodged with the Workplace Authority on 6 June 2007.
Because Marina's Dental Care is not a respondent to an award, the Workplace Authority
designates the Dental Health (Public Hospital) Award for the purposes of the fairness test. The
Workplace Authority decides that Liza's AWA does not pass the fairness test. From this date,
Liza's terms and conditions will be determined by the instrument that, but for the AWA coming
into operation, would have applied. In this case, the undertakings made by Marina's Dental Care
when it terminated the collective agreement, and the protected award conditions from the
designated award (that is, the Dental Health (Public Hospital) Award) will apply to Liza.
Senate page 28 Workplace Relations Amendment
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Schedule 1 - The Fairness Test
Section 346Z - Effect of section 346Y in relation to instruments
147. Proposed section 346Z would deal with the circumstance where, on cessation day, the
parties become bound by an instrument that would (because of proposed section 346Y) have
bound the parties but for the original agreement ceasing to operate because it did not pass the
fairness test. In this situation, despite any other provision of the Act, the instrument:
· is taken to have come into operation on the cessation day; and
· will bind the employer and the employee or employees.
148. There are a number of amendments to the provisions in Part 8 which deal with the
operation of agreements that ensure these instruments are able to operate in these circumstances
(see items 5, 6 and 7).
149. A reference to an instrument means the instruments listed in proposed subsection 346Y(5).
Section 346ZA - Redundancy provisions and section 394 undertakings
150. Under proposed section 346ZA, a workplace agreement that does not pass the fairness test
will not affect:
· preserved redundancy provisions; or
· the operation of undertakings under section 394, following unilateral termination of a
workplace agreement with 90 days notice.
151. Proposed subsection 346ZA(2) ensures that an employer who is bound by a redundancy
provision is again bound by that provision after a workplace agreement ceases to operate as a
result of not passing the fairness test, until the earliest of the following:
· the end of the period of 12 months from the time the workplace agreement was terminated;
· the employee is no longer employed by the employer; or
· a new workplace agreement comes into operation in relation to the employee and
employer.
152. Proposed subsection 346ZA(4) ensures that this rule applies to preserved redundancy
provisions derived from workplace agreements, pre-reform AWAs and pre-reform certified
agreements.
153. Subsection 394(1) enables an employer to make undertakings about an employee's or
employees' terms and conditions of employment after an agreement is terminated unilaterally by
the employer in accordance with Division 9 of Part 8. These types of undertakings operate as if
they were a workplace agreement for the purposes of their enforcement. Proposed subsection
346ZA(3) would ensure that any undertakings made under subsection 394(1) apply again to the
employer and employee where a subsequent workplace agreement does not pass the fairness test
under sections 346R or 346W. In such a case, the employer is taken to be bound by the
undertaking until either:
· the employee's employment ceases with that employer; or
· another workplace agreement comes into operation.
Section 346ZB - Operation of workplace agreements
154. Proposed section 346ZB would make clear that a workplace agreement that has ceased
operating because it does not pass the fairness test can never operate again.
155. The note would explain that this provision operates subject to subsection 346Y(3). This
means that, if a workplace agreement as varied under Division 8 does not pass the fairness test,
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Schedule 1 - The Fairness Test
then the workplace agreement in force before the variation was lodged is capable of being an
instrument that binds the employer and an employee or employees in relation to the terms and
conditions of employment.
Section 346ZC - Regulations may make provision for operation of provisions of revived
instruments
156. Proposed section 346ZC would enable regulations to be made to provide for and in relation
to the operation of instruments that are revived by operation of section 346Y.
Subdivision E - Entitlement to compensation
Section 346ZD - Employee is entitled to compensation in respect of fairness test period
157. Proposed section 346ZD would apply to an employee who may be entitled to
compensation from their employer because their agreement did not pass the fairness test
(proposed subsection 346ZD(1)). Sections 346Q, 346R, 346V, 346W and 346X each specify
when an employee's entitlement to compensation arises.
158. Proposed subsection 346ZD(2) would outline the method for calculating what (if any)
compensation an employer is required to pay an employee in relation to the `fairness test period',
where a workplace agreement did not pass the fairness test.
159. The `fairness test period' begins on the day on which the workplace agreement is lodged
and ends on either:
· the day on which the workplace agreement ceases to operate; or
· if the workplace agreement is varied (under section 346R or otherwise) in such a way that
it passes the fairness test - the day on which the variation was lodged.
160. An employee would be entitled to recover, by way of compensation, any shortfall in
entitlements during the fairness test period. A shortfall arises if the total value of the entitlements
to which the employee was entitled under the agreement is less than the total value of the
entitlements to which the employee would have become entitled if, during the fairness test
period, their employment was covered by the instrument that, but for the workplace agreement
which has failed the test, would have applied (for example, an award), or by protected award
conditions contained in a designated award.
161. Proposed subsection 346ZD(3) would provide that an employer breaches section 346ZD if
the employer does not pay to the employee the amount of compensation to which the employee
is entitled within 14 days of the agreement ceasing to operate. Proposed section 346ZD would be
an `applicable provision' for the purposes of Part 14 of the Act which deals with compliance.
Failure to pay compensation within the required period may lead to a court imposing a civil
penalty. An employee or a workplace inspector would also be entitled to take legal proceedings
to recover any compensation owing after the 14 day period.
162. Proposed subsection 346ZD(4) would define the `fairness test period' and `instrument'.
Senate page 30 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Example 1: A collective agreement does not pass the fairness test
fairness test period
Collective agreement
Collective agreement lodged determined to not pass fairness
test
Compensation payable
AB Chapman Pty Ltd is bound by a federal award. Under the pay scale derived from this award
Fred was paid $960.00 a week (the weekly equivalent of $50,000 per year). Under the award,
Fred was entitled to 15 percent superannuation and provided a $50 weekly bonus if he reaches
set performance targets. Fred meets his performance target each week.
AB Chapman's employees approve a new collective agreement, which gives Fred an annual 4
percent pay rise, but removed the performance bonus (a protected award condition) and reduced
the superannuation to 12 per cent. AB Chapman lodges the collective agreement with the
Workplace Authority. Fred is paid $1000 a week ($52,000 per year) under the collective
agreement. Subsequently, the Workplace Authority determines that the collective agreement
does not pass the fairness test.
Fred is entitled to compensation for the period between the collective agreement being lodged
and the date it failed the fairness test. The amount of compensation is based on any shortfall in
entitlements he received under the (unfair) collective agreement and what he would have
received under the federal award had it operated during the test period.
The shortfall is calculated against the entitlements Fred would have received if the collective
agreement had not come into operation and the award had operated during this period. This
includes the value of unpaid super contributions and is not limited to protected award conditions.
Example 2: An AWA fails the fairness test, but is varied and passes the fairness test
fairness test period
Original AWA fails but AWA
AWA Varied AWA as varied passes the fairness test
lodged lodged
Compensation payable
Compensation not
payable
Max has been working for his employer, Pashka's Playground Pty Ltd, since December 2005.
He earns $1200 a week (the weekly equivalent of $62,000 per year). Pashka's Playground
Senate page 31 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
lodged a collective agreement with the former Employment Advocate on 25 January 2006,
which did not remove or modify the protected award conditions from the award to which
Pashka's Playground was bound.? Subsequently, Pashka's Playground offers Max an AWA
which he approves. The AWA gives Max a higher salary of $1230 a week (the equivalent of
$64,000 a year) but no longer contains weekend penalty rates. The AWA is lodged with the
Workplace Authority on 20 July 2007 and will be subject to the fairness test.
After lodging the AWA, Pashka's Playground realises Max's AWA does not provide sufficient
compensation for the removal of his weekend penalty rates because of the amount of weekend
work he does (Max usually receives $60 a week in penalty rates). The overall salary Max
receives under the AWA is less than what he would have received if he had been paid the
combined salary and weekend penalty rates under the collective agreement. Pashka's
Playground and Max agree to vary the AWA to further increase his annual salary to $1270 per
week (the equivalent of $66,000 per year) and lodge the varied AWA with the Workplace
Authority shortly after the original AWA was lodged.
The Workplace Authority assesses both the original AWA and the AWA as varied as part of the
same process (as required by subsection 346N(3)). The Workplace Authority determines that
Max's original AWA does not pass the fairness test because he did not receive fair compensation
for the removal of the weekend penalty rates. However, the Workplace Authority is satisfied
that the AWA as varied passes the fairness test.
Max is entitled to compensation for the period he was paid in accordance with the original AWA
(ie between the lodgment of the AWA and when the variation was lodged). The amount of
compensation would be the difference between what Max was paid under the AWA and what he
would have been paid for that period if the collective agreement had operated.
Example 3: An AWA is varied before passing the fairness test and neither the AWA or
variation pass the fairness test
testing period
AWA and AWA as varied
AWA AWA varied determined to not pass fairness
lodged test
Compensation payable -
comparison between AWA
and award
Compensation payable -
comparison between varied
AWA and award
Megan started a new job as a sales assistant with Jeff's Street Wear. Megan approves an AWA
which excludes all protected award conditions with the exception of overtime payments. Shortly
after, Megan was promoted to shift supervisor, and she and Jeff's Street Wear agreed on a higher
salary. To cover Megan's promotion, Jeff's Street Wear lodges a variation to the AWA with the
Workplace Authority, which excludes all protected award conditions including the overtime
payment.
The Workplace Authority determines that neither the AWA nor the AWA as varied pass the
fairness test. Megan is entitled to compensation for 2 periods. The first period is between when
Senate page 32 Workplace Relations Amendment
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Schedule 1 - The Fairness Test
the AWA, and the variation to it, were lodged. The second period is when the AWA as varied
was lodged and the day the Workplace Authority determined that neither the AWA nor the
AWA as varied pass the fairness test.
Subdivision F - Civil remedy provisions
Section 346ZE - Employer must notify employees
163. Proposed subsection 346ZE(1) would provide that an employer who receives a notice from
the Workplace Authority about whether the Director is required to apply the fairness test to a
collective agreement or whether a collective agreement passes the fairness test, must take
reasonable steps to ensure a copy of the notice is given to all employees currently subject to the
agreement, as soon as practicable.
164. Proposed subsection 346ZE(2) would provide that failure to comply with the requirements
of proposed subsection 346ZE(1) may result in civil penalties being imposed on the employer.
Breach of subsection 346ZE(1) will attract a maximum pecuniary penalty of 30 penalty units.
The note would remind readers that the enforcement provisions are located in Division 11 of
Part 8 of the Act.
Section 346ZF - Employer not to dismiss etc. employee because agreement does not pass
the fairness test
165. Proposed subsection 346ZF(1) would prohibit an employer from dismissing (or threatening
to dismiss) an employee if the sole or dominant reason for doing so is that a workplace
agreement does not (or may not) pass the fairness test.
166. Proposed subsection 346ZF(2) would provide that failure to comply with the requirements
of proposed subsection 346ZF(1) may result in civil penalties being imposed on the employer.
Breach of subsection 346ZF(1) will attract a maximum pecuniary penalty of 60 penalty units.
This provision would be enforceable by workplace inspectors appointed by the Workplace
Ombudsman. An employee who is dismissed in breach of proposed subsection 346ZF(1) would
be entitled to compensation under Division 5A of Part 8 of the Act.
167. Proposed subsection 346ZF(3) would provide that, where proceedings are taken for an
alleged contravention of subsection 346ZF(1), it is presumed that the employer's sole or
dominant purpose for dismissing the employee was that the workplace agreement does not, or
may not, pass the fairness test. The effect of this provision is to reverse the onus of proof to
require the employer to establish (on the balance of probabilities) that the sole or dominant
purpose for dismissing the employee was not a contravention of subsection 346ZF(1). The onus
of proof is reversed because of the substantial evidentiary difficulty an applicant would face if
they were required to prove what the `purpose' of an employer was in dismissing the employee -
matters that would be peculiarly within the knowledge of the employer and would be easier for
the employer to disprove than for the applicant to prove.
168. A breach of this provision is enforceable by the workplace inspectors appointed by the
Workplace Ombudsman.
Section 346ZG - Other remedies for the contravention of section 346ZF
169. New section 346ZG would enable the Court to make orders if an employer dismisses (or
threatens to dismiss) an employee for the sole or dominant reason that a workplace agreement
does not (or may not) pass the fairness test (that is, if an employer contravenes new section
346ZF).
Senate page 33 Workplace Relations Amendment
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Schedule 1 - The Fairness Test
170. Subsection 346ZG(1) provides that the orders that the Court may make are:
· an order requiring the employer to pay a specified amount of compensation for damages
suffered by the employee; or
· any other order that the Court thinks appropriate.
171. Other orders that the Court may make could include reinstatement or injunctions.
172. An eligible person may apply to the Court seeking such relief. Under proposed subsection
346ZG(3), an eligible person means:
· a workplace inspector;
· an employee effected by the contravention; or
· a person prescribed by the regulations.
173. An organisation of employees may also apply on behalf of the employee concerned,
provided that:
· it has been requested to do in writing by the employee concerned; and
· it has a member employed by the employee's employer; and
· is entitled to represent the industrial interests of the employee under its eligibility rules.
Section 346ZH - Employer not to require employee to agree to exclude or modify a
protected award condition
174. Proposed subsection 346ZH(1) would prohibit an employer, by any act or omission in
relation to a workplace agreement, coercing an existing employee to agree, or not to agree, to
modify or exclude a protected award condition.
175. Proposed subsection 346ZH(2) would provide that the prohibition in proposed subsection
346ZH(1) would not apply to protected industrial action engaged by the employer which is
protected action within the meaning of section 435.
176. Proposed subsection 346ZH(3) would provide that subsection 346ZH(1) is a civil remedy
provision. Breach of subsection 346ZH(1) will attract a maximum pecuniary penalty of 60
penalty units.
177. A breach of this provision would be enforceable by workplace inspectors appointed by the
Workplace Ombudsman.
Senate page 34 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Part 2 - Consequential amendments
Workplace Relations Act 1996
Item 2 - After paragraph 337(4)(c)
178. Item 2 is a minor amendment consequential on the amendments made by Part 1 of
Schedule 1, relating to the fairness test. It would require the information statement an employer
is obliged to give an employee prior to their agreement to contain information about when the
Workplace Authority is required to decide whether an agreement passes the fairness test.
Item 3 - Subsection 344(5)
179. Item 3 is consequential on the amendments made by Part 1 of Schedule 1 relating to the
fairness test. The Workplace Authority is currently not required to consider or determine
whether the requirements of Part 8 have been met in relation to the making or content of
anything annexed to a declaration lodged with the Workplace Authority in relation to a
workplace agreement. The amendment would make clear that this does not apply to Division 5A
(the fairness test) as the Workplace Authority would be required to examine the content of an
agreement to determine whether it passes the fairness test.
Item 4 - After paragraph 347(4)(b)
180. Item 4 is consequential on the amendments made by Part 1 of Schedule 1 relating to the
fairness test. Subsection 347(4) sets out certain circumstances where a workplace agreement
ceases to operate. Item 4 would provide that, in addition to the existing circumstances, a
workplace agreement also ceases to be in operation in the following situations:
· if the Workplace Authority decides under proposed section 346R that it does not pass the
fairness test and the agreement is not varied within the required time period; and
· if the Workplace Authority decides under proposed section 346W that the agreement as
varied does not pass the fairness test.
Item 5 - After subsection 347(7)
Item 6 - After subsection 347(8)
Item 7 - After subsection 347(9)
181. These items are consequential on proposed sections 346Y and 346Z to be inserted by Part
1 of Schedule 1. Proposed sections 346Y and 346Z ensure that the employee or employees who
were subject to an agreement that does not pass the fairness test become covered by the
instrument that would have applied to their employment, but for the failed agreement coming
into operation. These items would provide that an agreement that has ceased to operate can
operate again if the reason it ceased to operate was that it was replaced on or after 7 May 2007
by an agreement which did not pass the fairness test. This would be the case despite subsection
347(7), (8) and (9) which provide (in respect of an AWA, collective agreement and multi-
business agreement respectively) that an agreement that has ceased to operate because it has
been replaced can never operate again in relation to that employee.
182. Items 22, 27, 33, 34, 35, 37, 38, 39, 40 would operate in the same way for workplace
determinations, Victorian employment agreements (certain agreements entered into under the
Employee Relations Act 1992 of Victoria before 1 January 1997), pre-reform certified
agreements, pre-reform AWAs, section 170MX awards, exceptional matters orders, old IR
agreements, preserved State agreements and notional agreements preserving State awards
respectively.
Senate page 35 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Item 8 - At the end of subsection 354(2)
183. Section 354 deals with protected award conditions. Item 8 would include a note at the end
of subsection 354(2) to remind readers that a workplace agreement that excludes or modifies
certain protected award conditions is subject to Division 5A (which relates to the application of
the fairness test).
Item 9 - After paragraph 367(2)(a)
184. Item 9 would make a minor amendment consequential on proposed section 346R. It would
provide that one of the circumstances in which a workplace agreement can be varied is in
accordance with proposed section 346R (which deals with variations to agreements that do not
pass the fairness test).
Item 10 - Subsection 377(5)
185. Item 10 is consequential on the amendments made by Part 1 of Schedule 1 relating to the
fairness test. The Workplace Authority is currently not required to consider or determine whether
the requirements of Part 8 have been met in relation to the making or content of anything
annexed to a declaration lodged with the Workplace Authority in relation to a variation to a
workplace agreement. The amendment would make clear that this does not apply to Division 5A
(the fairness test) as the Workplace Authority would be required to examine the content of a
variation to a workplace agreement and determine whether it passes the fairness test.
Item 11 - At the end of section 394
186. Item 11 is consequential on proposed section 346ZA. Section 346ZA would revive an
employer undertaking made on unilateral termination of an agreement under section 394 where:
· the undertaking ceased to operate in relation to an employee when the employee's
employment became subject to a later workplace agreement; and
· that later agreement ceases to operate because it does not pass the fairness test.
187. This item would amend section 394 to enable an undertaking to operate again under
proposed section 346ZA despite subsection 394(7) which provides that an undertaking that has
ceased to operate in relation to an employee can never operate again in relation to that employee.
Items 12 - At the end of subsection 400(6)
Item 13 - After subsection 400(6)
Item 14 - At the end of section 400
188. These items would amend section 400 to clarify that the prohibition on applying duress to
an employer or employee in connection with an AWA applies to the engagement of employees
as part of a transmission of business.
189. Under subsection 400(5) of the Act a person is prohibited from applying duress in
connection with an AWA. Subsection 400(6) provides that it is not duress merely for an
employer to offer a prospective employee an AWA as a condition of engagement.
190. Item 12 would amend subsection 400(6) to provide an exception in the circumstance
described in new subsection 400(6A).
191. Item 13 would insert a new subsection 400(6A) specifying those circumstances - namely, a
new employer in a transmission of business requiring a person employed in the business being
transferred to make an AWA as a condition of employment by the new employer.
Senate page 36 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
192. Item 14 would insert a new subsection 400(8) defining terms used in new subsection
400(6A). The definitions ensure that subsection 400(5) applies to all transmissions of business
dealt with by the Act.
193. The combined effect of these provisions is to clarify that the prohibition on applying duress
to an employer or employee in connection with an AWA applies to the engagement of
employees as part of a transmission of business and that an employer who seeks to make
continued employment conditional on making an AWA cannot rely on subsection 400(6).
194. These provisions spell out the existing law in this area. Courts have found duress to have
occurred in circumstances where existing employees would be in a less favourable position than
they are currently in by refusing to accept an AWA, and had some legitimate expectation that
they should not be placed in that position. Transferring employees can be regarded as being in a
similar position to existing employees. The Federal Court has found that, in the context of a
transmission of business, a requirement to make an AWA may amount to duress: Schanka v
Employment National (Administration) Pty Ltd [2001] FCA 579.
Item 15 - After paragraph 407(2)(ja)
195. Item 15 would amend subsection 407(2) to provide maximum levels of pecuniary penalties
for contraventions of the following civil remedy provisions:
· a failure by an employer to notify employees about certain decisions made by the
Workplace Authority in relation to the application of the fairness test to a collective
agreement - subsection 346ZE(1) - attracts a maximum penalty of 30 penalty units;
· an employer dismissing, or threatening to dismiss, an employee if the sole or dominant
reason for doing so is that a workplace agreement does not (or may not) pass the fairness
test - subsection 346ZF(1) - attracts a maximum penalty of 60 penalty units; and
· any act or omission by an employer in relation to a workplace agreement, with the
intention of coercing an existing employee to agree, or not to agree, to modify or remove a
protected award condition test - subsection 346ZH(1) - attracts a maximum penalty of 60
penalty units.
196. A penalty unit is currently $110. The specified levels of penalties apply to individuals.
Breaches by bodies corporate attract a maximum penalty of five times that specified in
subsection 407(2) - (that is, $33,000).
Item 16 - Paragraph 416(1)(a)
Item 17 - Paragraph 416(1)(d)
Item 18 - At the end of subsection 416(1)
Item 19 - Paragraph 417(1)(a)
Item 20 - Paragraph 417(1)(g)
Item 21 - Paragraph 417(1)(k)
197. These items are consequential on proposed sections 346S, 346J, 346P, 346K and 346L to
be inserted by Part 1 of Schedule 1. These items would provide the Workplace Authority
Director with power to issue a verified copy of, or a certificate relating to, a declaration, notice
or determination that was provided or issued under the listed sections.
Senate page 37 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Item 22 - At the end of section 506
198. This item is consequential on proposed sections 346Y and 346Z to be inserted by Part 1 of
Schedule 1. It would operate in the same way as items 5, 6 and 7 in relation to workplace
determinations.
Item 23 - Section 717 (after paragraph (a) of the definition of applicable provision)
Item 24 - Subsection 718(1) (after item 5 of the table)
Item 25 - Subsection 718(2)
Item 26 - After paragraph 718(6)(b)
199. These items would amend sections 717 and 718 to provide that an employee who is
affected because their agreement did not pass the fairness test, an organisation of employees (in
respect of a breach that relates to an employee who is a member of that organisation) or an
inspector may apply for a penalty or other remedy in relation to a breach of proposed section
346ZD under Division 2 of Part 14. Proposed section 346ZD would require an employer to pay
compensation to an employee within a specified period. Breach of this provision may give rise to
a civil penalty or other remedy, for example recovery of the amount owing.
Item 27 - At the end of section 890
200. This item is consequential on proposed sections 346Y and 346Z to be inserted by Part 1 of
Schedule 1. It would operate in the same way as items 5, 6 and 7 in relation to Victorian
employment agreements.
Item 28 - At the end of clause 89 of Schedule 6
201. Item 28 would insert proposed subclause 89(3) into Schedule 6 of the Act. Proposed
subclause 89(3) would provide that a common rule award that was binding on an employer and
employee immediately before the day on which a workplace agreement was lodged, will be
taken to be that employer and employee's relevant award for the purposes of Division 5A of Part
8 of the Act relating to the fairness test.
202. In addition, proposed paragraph 89(3)(d) would extend the definition of instrument in
subsection 346Y(5) of Part 8 to include a common rule award, so that an employer and employee
who were bound by a common rule immediately before a workplace agreement was lodged
could be covered by that common rule, if a workplace agreement does not pass the fairness test.
Item 29 - Clause 95 of Schedule 6
203. Item 29 is a minor technical amendment consequential on item 30.
Item 30 - At the end of clause 95 of Schedule 6
204. Item 30 would insert proposed subclause 95(2) into Schedule 6 of the Act. Proposed
subclause 95(2) would provide that a transitional Victorian reference award that was binding on
an employer and employee immediately before the day on which a workplace agreement was
lodged, will be taken to be that employer and employee's relevant award for the purposes of
Division 5A of Part 8 of the Act.
205. In addition, proposed paragraph 95(2)(d) would extend the definition of instrument in
subsection 346Y(5) of Part 8 to include a transitional Victorian reference award, so that an
employer and employee who were bound by a transitional Victorian reference award
immediately before a workplace agreement was lodged could be covered by that award where
their workplace agreement does not pass the fairness test.
Senate page 38 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Item 31 - Clause 102 of Schedule 6
206. Item 31 is a minor technical amendment consequential on item 32.
Item 32 - At the end of clause 102 of Schedule 6
207. Item 32 would insert proposed subclause 102(2) into Schedule 6 of the Act. Proposed
subclause 102(2) would provide that a transitional award (other than a Victorian reference
award) that was binding on an excluded employer in respect of the employment of employees in
Victorian immediately before the day on which a workplace agreement was lodged, will be taken
to be that employer and an employee's relevant award for the purposes of Division 5A of Part 8
of the Act.
208. In addition, proposed paragraph 102(2)(d) would extend the definition of instrument in
subsection 346Y(5) of Part 8 to include a transitional award (other than a Victorian reference
award) that was binding on an excluded employer in respect of the employment of employees in
Victoria, so that an employer and employee who were bound by that type of transitional award
immediately before a workplace agreement was lodged could be covered by that type of
transitional award where their workplace agreement does not pass the fairness test.
Item 33 - After subclause 3(5) of Schedule 7
Item 34 - At the end of clause 18 of Schedule 7
Item 35 - At the end of clause 25 of Schedule 7
Item 36 - Clause 27 of Schedule 7
Item 37 - At the end of clause 27 of Schedule 7
Item 38 - At the end of clause 28 of Schedule 7
Item 39 - At the end of clause 15G of Schedule 8
Item 40 - At the end of clause 38A of Schedule 8
209. These items are consequential on proposed sections 346Y and 346Z to be inserted by Part
1 of Schedule 1. They would operate in the same way as items 5, 6 and 7 in relation to pre-
reform certified agreements, pre-reform AWAs, section 170MX awards, exceptional matters
orders, old IR agreements, preserved State agreements and notional agreements preserving State
awards respectively.
Item 41 - At the end of Division 6A of Part 2 of Schedule 8
210. Item 41 would insert proposed clause 25B into Schedule 8 to extend the application of,
with modification, Division 5A of Part 8 of the Act relating to the fairness test to workplace
agreements in the circumstances that an employer and employee were bound by a preserved
State agreement immediately before the workplace agreement came into operation. The fairness
test would assess whether employees are fairly compensated where a workplace agreement
modifies or excludes any or all of an employee's protected preserved conditions, such as penalty
rates.
Clause 25B - Application of fairness test where employment was subject to preserved State
agreement
211. Proposed paragraphs 25B(1)(a),(b) and (c) are application provisions that would prescribe
the circumstances in which clause 25B operates to extend the application of the fairness test to
employers and employees bound by a preserved State agreement.
Senate page 39 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
212. In order for clause 25B to apply, an employer and employee must have:
· lodged a workplace agreement with the Workplace Authority; and
· been bound by a preserved State agreement (either individual or collective) immediately
before the day on which the workplace agreement was lodged.
213. In addition, the workplace agreement must contain a protected preserved condition because
of paragraph 25A(2)(a) of Schedule 8 to the Act.
214. Paragraph 25A(2)(a) of Schedule 8 to the Act provides that protected preserved conditions
are taken to be included in a workplace agreement where an employee's employment was
subject to a preserved State agreement that has ceased to apply to that employee because the
employee is bound by a workplace agreement.
215. Therefore, if an employer and employee are bound by a workplace agreement that is not
taken to include a protected preserved condition, that is, if the conditions in proposed paragraphs
25B(1)(a), (b) and (c) are not met, then clause 25B would not extend the operation of the fairness
test to that workplace agreement. Rather, if the workplace agreement should be subject to the
fairness test, Part 8 of the Act itself would apply the fairness test to that workplace agreement.
This would mean that where necessary, an employer and employee could be designated a federal
award under Division 5A for the purposes of the fairness test. However, an employee cannot be
designated an award under clause 25B. This is because an employee covered by that clause
would already have applicable protected preserved conditions and would not require a
designated award for the purposes of the fairness test.
216. If the conditions in proposed paragraphs 25B(1)(a), (b) and (c) are met in relation to a
workplace agreement, then the fairness test in Part 8 would apply to the workplace agreement,
subject to the modifications contained in proposed paragraphs 25B(1)(d) to (m) and subclauses
25B(2), (3) and (4).
217. Proposed paragraph 25B(1)(d) would provide that a reference in Division 5A of Part 8 of
the Act to protected award conditions should be read as if it were substituted with a reference to
protected preserved conditions. Protected preserved condition is defined for the purposes of this
clause in proposed subclauses 25B(3) and (4).
218. Proposed paragraph 25B(1)(e) would provide that a reference in Division 5A of Part 8 to a
relevant award or reference award should be read as if it were substituted with a reference to
relevant preserved State agreement. A relevant preserved State agreement is defined for the
purposes clause 25B in proposed subclause 25B(3).
219. Proposed paragraph 25B(1)(f) would provide that paragraph 346C(1)(a) does not apply to
employers and employee or employees bound by a workplace agreement within the scope of
clause 25B. Rather, paragraph 346C(1)(a) should be replaced with the words "if the protected
preserved conditions are taken to be included in the workplace agreement because of paragraph
25(A)(2)(a) of Schedule 8". This modification ensures that protected preserved conditions will
apply for the purposes of Division 5A, where they are included in a workplace agreement. This
is necessary because unlike protected award conditions that are terms of an award, protected
preserved conditions are not terms contained in a preserved State agreement, but rather operate
in conjunction with it.
220. Proposed paragraph 25B(1)(g) would provide that paragraphs 346C(b) and subsection
346C(2) of new Division 5A (relating to the application of protected award conditions contained
in designated awards) would not apply to an employer and employee or employees bound by
workplace agreements that are within the scope of clause 25B. This is because a workplace
agreement covered by clause 25B must, by virtue of the application provisions in paragraphs
Senate page 40 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
25B(1)(a),(b) and (c), contain protected preserved conditions, therefore it would not be necessary
to designate an award to these employers and employees. Therefore, any provision in Part 8
relating to designated awards would not extend to employers and employees covered by clause
25B.
221. Proposed paragraph 25B(1)(h) would provide that paragraphs 346E(1)(b), 346E(2)(b),
346F(1)(b) and 346F(2)(b) of new Division 5A of Part 8 do not operate as part of the fairness
test as applied under clause 25B. Paragraphs 346E(1)(b), 346E(2)(b), 346F(1)(b) and 346F(2)(b)
limit the application of the fairness test to only those workplace agreements that bind employees
employed in an industry or occupation in which the terms and conditions of the kind of work
performed by the employee are usually regulated by an award.
222. This prerequisite does not apply under clause 25B. Rather, it is intended that any
employee bound by a workplace agreement lodged on or after 7 May 2007 that is taken to
include protected preserved conditions would have the fairness test applied to it (subject to the
other pre-requisites for assessment being met). This ensures that any employee that has a
protected preserved condition modified or excluded by their workplace agreement would not
lose the benefit of that condition without fair compensation in return.
223. Proposed paragraph 25B(1)(i) would provide that sections 346H, 346K and 346L would
not apply to employers and employees bound by workplace agreements within the scope of
clause 25B. This is because employers and employees bound by a preserved State agreement that
is taken to include protected preserved conditions cannot be designated an award for the
purposes of the fairness test under this clause when they lodge a workplace agreement.
224. Proposed paragraph 25B(1)(j) would provide that subsection 346Y(2)(b) does not apply to
employers and employees bound by workplace agreements within the scope clause 25B. This is
because an employer and employee that were bound by these agreements could not have been
designated an award for the purposes of the fairness test under that clause. As such, it is not
necessary to include scope for an employer and employee to be covered by the terms of a
designated award in the event that no other instrument is capable of applying.
225. Rather, those employers and employees that are not bound by another instrument will be
covered by any protected preserved condition that would be taken to be included in the
workplace agreement that has ceased to apply because the workplace agreement did not pass the
fairness test. These protected preserved conditions will have effect in relation to the employer
and employee as if the agreement did not purport to exclude or modify their application. This
outcome is consistent with the consequences of terminating a preserved State agreement under
the Act.
226. In that case, where the employer and employee or employees are not bound by another
instrument, for example an award, the employer and employee would be taken to be bound by
protected preserved conditions.
227. Proposed paragraph 25B(1)(k) would modify subsection 346Y(5) to include a preserved
State agreement in the definition of instrument for the purposes of section 346Y. This paragraph
would ensure that an employer and employee or employees that were bound by a preserved State
agreement immediately before the original workplace agreement was lodged could again be
bound by the preserved State agreement if a workplace agreement does not pass the fairness test.
228. Note, however, that a preserved State agreement that has been terminated in accordance
with clause 21 of Schedule 8 after the workplace agreement was lodged would not be an
instrument for the purposes of section 346Y. This is because a terminated preserved State
agreement has not ceased to operate because the new workplace agreement was lodged; rather it
has ceased to operate because it was terminated.
Senate page 41 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
229. Proposed paragraph 25B(1)(l) would provide that a reference in subsection 346ZA(4) to
section 399A should be substituted with a reference to either subclause 21A or 21D of Schedule
8. This means that the operation of redundancy provisions preserved under clauses 21A or 21D
of Schedule 8 would be revived if those provisions applied to an employer and employee
immediately before a workplace agreement was lodged, and that workplace agreement did not
pass the fairness test.
230. Proposed paragraph 25B(1)(m) would provide that subparagraph 346ZD(2)(b)(ii) does not
apply to an employer and employee bound by a workplace agreement within the scope of clause
25B. This is because a designated award is not relevant to these employers and employees.
231. Rather, if an employer and employee are not bound by an instrument (within the meaning
of the definition of instrument in section 346Y) the protected preserved conditions that have
effect in relation to the employee by virtue of subsection 346Z(2)(b) would be relevant for the
assessment of compensation that is payable to the employee.
232. Proposed subclause 25A(2) would provide that Parts 6 and 14 of the Act (which relate to
inspectors powers and compliance and enforcement respectively) apply to a protected preserved
condition that has effect because of paragraph 346Y(2)(b) as if that condition were a workplace
agreement in operation. In particular, where a protected preserved condition has effect in relation
to an employee because the employee was bound by an AWA that did not pass the fairness test,
Parts 6 and 14 apply to the protected preserved condition as if it were an AWA in operation.
233. Further, where a protected preserved condition has effect in relation to an employee
because the employee was bound by a collective agreement that did not pass the fairness test,
Parts 6 and 14 apply to the protected preserved condition as if it were a collective agreement in
operation.
234. Proposed subclause 25B(3) would provide definitions of terms relevant to clause 25B. For
the purposes of clause 25B a protected preserved condition and relevant preserved State
agreement are defined.
235. Proposed subclauses 25B(3) and (4) would provide a definition of protected preserved
condition for the purposes of clause 25B. Protected preserved condition would have the same
meaning as in subclause 25A(4) but would be subject to proposed subclause 25B(4).
236. As is the case in the definition of protected award conditions in section 346B, it is not
necessary to include outworker conditions in the operation of this clause. Subclause 25A(3)
already provides that protected preserved conditions about outworker conditions cannot be
excluded or modified and will have effect despite any terms of a workplace agreement that
provide, in a particular respect, a less favourable outcome for the outworker. Clause 25B would
have effect in relation to workplace agreements as affected by subclause 25A(3).
Item 42 - At the end of Division 6 of Part 3 of Schedule 8
237. Item 42 would insert new clause 52AAA into Schedule 8 to extend the application of, with
modification, Division 5A of Part 8 of the Act relating to the fairness test to workplace
agreements in the circumstances that an employer and employee were bound by a notional
agreement preserving State awards immediately before the workplace agreement came into
operation. The fairness test would assess whether employees are fairly compensated where a
workplace agreement modifies or excludes any or all of an employee's protected notional
conditions, such as penalty rates.
Senate page 42 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Clause 52AAA - Application of fairness test where employment was subject to notional
agreement preserving State awards
238. Proposed paragraphs 52AAA(1)(a),(b) and (c) are application provisions that would
prescribe the circumstances in which clause 52AAA operates to extend the application of the
fairness test to employers and employees bound by a notional agreement preserving State
awards.
239. In order for clause 52AAA to apply, an employer and employee must have:
· lodged a workplace agreement with the Workplace Authority; and
· been bound by a notional agreement preserving State awards immediately before the day
on which the workplace agreement was lodged.
240. In addition, the workplace agreement must contain a protected notional condition because
of paragraph 52(2)(a) of Schedule 8 to the Act.
241. Paragraph 52AAA(2)(a) of Schedule 8 to the Act provides that protected notional
conditions are taken to be included in a workplace agreement where an employee's employment
was subject to a notional agreement preserving State awards that has ceased to apply to that
employee because the employee is bound by a workplace agreement.
242. Therefore, if an employer and employee are bound by a workplace agreement that is not
taken to include a protected notional condition, that is, if the conditions in proposed paragraphs
52AAA(1)(a), (b) and (c) are not met, then clause 52AAA would not extend the operation of the
fairness test to that workplace agreement. Rather, if the workplace agreement should be subject
to the fairness test, Part 8 of the Act itself would apply the fairness test to that workplace
agreement. This would mean that where necessary, an employer and employee could be
designated a federal award under Division 5A for the purposes of the fairness test. However, an
employee cannot be designated an award under clause 52AAA because an employee covered by
that clause would already have applicable protected notional conditions and would not require a
designated award for the purposes of the fairness test.
243. If the conditions in proposed paragraphs 52AAA(1)(a), (b) and (c) are met in relation to a
workplace agreement, then the application of the fairness test in Part 8 would apply to the
workplace agreement, subject to the modifications contained in proposed paragraphs
52AAA(1)(d) to (m) and subclauses 52AAA(2) and (3).
244. Proposed paragraph 52AAA(1)(d) would provide that a reference in Division 5A of Part 8
of the Act to protected award conditions should be read as if it were substituted with a reference
to protected notional conditions. Protected notional conditions are defined for the purposes of
this clause in proposed subclauses 52AAA(2) and (3).
245. Proposed paragraph 52AAA(1)(e) would provide that a reference in Division 5A of Part 8
to a relevant award or reference award should be read as if it were substituted with a reference to
relevant notional agreement preserving State awards. A relevant notional agreement preserving
State awards is defined for the purposes of clause 52AAA in proposed subclause 52AAA(2).
246. Proposed paragraph 52AAA(1)(f) would provide that paragraphs 346C(1)(b) and
subsection 346C(2) (relating to the application of protected award conditions contained in
designated awards) would not apply to an employer and employee or employees bound by
workplace agreements that are within the scope clause 52AAA. This is because a workplace
agreement covered by clause 52AAA must, by virtue of the application provisions in paragraphs
52AAA(1)(a),(b) and (c), contain protected notional conditions, and so it would not be necessary
to designate an award to these employers and employees. Therefore, any provision in Part 8
Senate page 43 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
relating to designated awards would not extend to employers and employees covered by clause
52AAA.
247. Proposed paragraph 52AAA(1)(g) would provide that paragraphs 346E(1)(b), 346E(2)(b),
346F(1)(b) and 346F(2)(b) of new Division 5A do not operate as part of the fairness test as
applied 52AAA. Paragraphs 346E(1)(b), 346E(2)(b), 346F(1)(b) and 346F(2)(b) limit the
application of the fairness test to only those workplace agreements that bind employees that are
employed in an industry or occupation which the terms and conditions of the kind of work
performed by the employee are usually regulated by an award.
248. This prerequisite does not apply under clause 52AAA. Rather, it is intended that any
employee bound by a workplace agreement lodged on or after 7 May 2007 that is taken to
include protected notional conditions would have the fairness test applied to it (subject to the
other prerequisites for assessment being met). This ensures that any employee that has a
protected notional condition modified or excluded by their workplace agreement would not lose
the benefit of that condition without fair compensation in return.
249. Proposed paragraph 52AAA(1)(h) would provide that sections 346H, 346K and 346L of
new Division 5A do not apply to employers and employees bound by workplace agreements
within the scope of clause 52AAA. This is because employers and employees bound by these
agreements cannot be designated an award for the purposes of the fairness test under that clause.
250. Proposed paragraph 52AAA(1)(i) would provide that subsection 346Y(2)(b) does not apply
to employers and employees bound by workplace agreements within the scope clause 52AAA.
This is because an employer and employee that were bound by these agreements could not have
been designated an award for the purposes of the fairness test under that clause.
251. Proposed paragraph 52AAA(1)(j) would modify subsection 346Y(5) to include a notional
agreement preserving State awards in the definition of instrument for the purposes of section
346Y. This paragraph would ensure that an employer and employee or employees that were
bound by a notional agreement preserving State awards immediately before the original
workplace agreement was lodged could again be bound by the notional agreement preserving
State awards if a workplace agreement does not pass the fairness test.
252. Proposed paragraph 52AAA(1)(j) would provide that subparagraph 346ZD(2)(b)(ii) does
not apply to an employer and employee bound by a workplace agreement within the scope of
clause 52AAA. This is because a designated award is not relevant to these employers and
employees.
253. Proposed subclause 52AAA(3) and (4) would provide definitions of terms relevant to
clause 52AAA. For the purposes of clause 52AAA protected notional conditions and relevant
notional agreement preserving State awards are defined.
254. As is the case in the definition of protected award conditions in section 346B, the definition
of protected notional conditions excludes outworker conditions. It is not necessary to include
outworker conditions in the operation of this clause. Subclause 52(2A) already provides that
protected notional conditions about outworker conditions cannot be excluded or modified and
will have effect despite any terms of a workplace agreement that provide, in a particular respect,
a less favourable outcome for the outworker. Clause 52AAA would have effect in relation to
workplace agreements as affected by subclause 52(2A).
Senate page 44 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 1 - The Fairness Test
Example 1:
Notional Collective Collective
agreement agreement lodged agreement fails
preserving a state fairness test
award
Notional agreement
preserving a state
award applies
DREF Pty Ltd is bound by a notional agreement preserving a state award (NAPSA). DREF's
employees approve a new collective agreement which is lodged with the Workplace Authority.
The Workplace Authority determines that the collective agreement does not pass the fairness
test.
From this day, DREF's employees' collective agreement ceases to operate. From this date
DREF's terms and conditions are governed by the instrument that, but for the collective
agreement, would have applied (ie as if the collective agreement had not come into operation).
Because DREF Pty Ltd was bound by a NAPSA, it applies.
Senate page 45 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 2 - Workplace Authority
Schedule 2 - Workplace Authority
Part 1-Main Amendments
Workplace Relations Act 1996
Item 1 - Part 5 (heading)
255. This item would repeal the heading for Part 5 and substitute `Part 5 - Workplace Authority
Director'.
Item 2 - Divisions 1 and 2 of Part 5
256. This item would repeal Divisions 1 and 2 of Part 5 and substitute the following Divisions:
Division 1 - Workplace Authority Director
Division 2 - Workplace Authority Deputy Directors
Division 3 - Staff, delegations etc
257. Item 2 would provide for the appointment of the Workplace Authority Director. It would
also establish the Workplace Authority as a statutory agency and provide for the appointment of
Workplace Authority Deputy Directors.
258. The Workplace Authority Director would perform the functions of the Employment
Advocate, as well as be responsible for:
· administering the fairness test under proposed Division 5A of Part 8;
· providing a pre-lodgment facility to check agreements against the fairness test;
· providing information and advice to employees and employers about workplace agreement
making and Commonwealth workplace relations laws;
· providing a comprehensive information service about pay and conditions issues; and
· providing advice specifically targeted at young people and people from a non-English
speaking background.
Division 1 - Workplace Authority Director
259. Proposed Division 1 would provide for the appointment of a Workplace Authority Director
to head the Workplace Authority and set out his or her functions, including those that relate to
workplace agreements and the fairness test.
Subdivision A - Establishment and Functions
Section 150A - Workplace Authority Director
260. Proposed section 150A would establish the statutory office of the Workplace Authority
Director. Proposed section 151A would provide for the Workplace Authority Director to be
appointed by the Governor-General.
Section 150B - Functions of Workplace Authority Director
261. Proposed subsection 150B(1) would set out the Workplace Authority Director's broad
functions. These are to:
· promote an understanding of Commonwealth workplace relations legislation, including by
making available to the public general information and guidance about the operation of the
legislation;
Senate page 46 Workplace Relations Amendment
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Schedule 2 - Workplace Authority
· provide education, assistance and advice to employees, employers and organisations in
relation to their rights and obligations under Commonwealth workplace relations
legislation;
· promote the making of workplace agreements;
· provide education, assistance and advice to employees, employers (especially employers in
small business) and organisations in relation to workplace agreements;
· accept lodgement of workplace agreements and notices about transmission of instruments;
· decide under Division 5A of Part 8 whether workplace agreements pass the fairness test;
· authorise multiple-business agreements in accordance with the regulations;
· analyse workplace agreements;
· refer matters to the Workplace Ombudsman and workplace inspectors; and
· perform any other function conferred on the Workplace Authority Director by
Commonwealth workplace relations legislation, the Registration and Accountability of
Organisations Schedule or another Act.
262. Proposed subsection 150B(2) would require the Workplace Authority Director, when
performing his or her functions in relation to workplace agreements, to have particular regard to:
· the needs of workers in disadvantaged bargaining positions, including for example women,
people from a non-English speaking background, young people, apprentices, trainees and
outworkers;
· encouraging parties to agreement-making to have regard to those needs;
· assisting workers to balance work and family responsibilities; and
· the need to prevent and eliminate discrimination.
Section 150C - Minister may give directions to Workplace Authority Director
263. Proposed section 150C would allow the Minister to give written directions to the
Workplace Authority Director about the performance of his or her functions. These directions
would be a legislative instrument under the Legislative Instruments Act 2003 and subject to
public scrutiny.
264. Such directions must be of a general nature, for example to give particular attention to
providing information and advice specifically targeted at young people. The Minister would be
expressly precluded from giving directions in relation to a specific case or in relation to the
Workplace Authority Director's performance of functions, or exercise of powers as an Agency
head under the Public Service Act 1999 (proposed subsections 150C(2) and (3)). This restriction
ensures the independence of the Workplace Authority.
265. The Workplace Authority Director would be required to comply with any direction given
by the Minister under this provision (proposed subsection 150C(4)).
266. Despite section 44 of the Legislative Instruments Act 2003, which provides that Ministerial
directions are not disallowable, proposed subsection 150C(5) expressly provides that a direction
by the Minister would be a disallowable instrument.
Subdivision B - Appointment and terms and conditions
267. This Division would provide for the appointment and entitlements of the Workplace
Authority Director.
Senate page 47 Workplace Relations Amendment
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Schedule 2 - Workplace Authority
Section 151A - Appointment of Workplace Authority Director
268. Proposed subsection 151A(1) would provide for the Governor-General to appoint the
Workplace Authority Director by written instrument.
269. Proposed subsection 151A(2) would require that before the Governor-General may appoint
a person as the Workplace Authority Director, the Minister must be satisfied that the person has
suitable qualifications or experience, and is of good character.
270. The length of an appointment would be specified in the written instrument of appointment,
but cannot exceed 5 years (proposed subsection 151A(3)). The Workplace Authority Director
would be appointed on a full-time basis (proposed subsection 151A(4)). The Workplace
Authority Director could be reappointed for a further term.
Section 151B - Remuneration
271. Proposed subsection 151B(1) would provide that the Remuneration Tribunal would
determine the remuneration of the Workplace Authority Director or, in the absence of a
determination, the regulations could set the remuneration. In addition, the Workplace Authority
Director would be paid any allowances prescribed by regulation (proposed subsection 151B(2)).
272. Proposed subsection 151B(3) would provide that this section has effect subject to the
Remuneration Tribunal Act 1973. This would ensure that general provisions of the
Remuneration Tribunal Act 1973 are not displaced by this section.
Section 151C - Leave of absence
273. Proposed subsection 151C(1) would provide that the Remuneration Tribunal would
determine the recreation leave entitlements for the Workplace Authority Director.
274. Proposed subsection 151C(2) would allow the Minister to grant the Workplace Authority
Director leave of absence, other than recreation leave, on such terms and conditions as he or she
determines.
Section 151D - Other terms and conditions
275. Proposed section 151D would provide that the Governor-General may determine terms and
conditions relating to matters not covered by the Act in relation to the Workplace Authority
Director.
Section 151E - Outside employment
276. Proposed section 151E would provide that the Workplace Authority Director cannot
engage in other paid employment without the Minister's approval.
277. These arrangements are complemented by proposed paragraph 151J(2)(c) which would
allow the Governor-General to terminate the Workplace Authority Director's appointment if the
requirements of proposed subsection 151E are contravened.
Section 151F - Disclosure of interests
278. Proposed section 151F would require the Workplace Authority Director to give the
Minister written notice of all pecuniary or other interests that could conflict with the proper
performance of the Workplace Authority Director's functions.
279. These arrangements are complemented by proposed paragraph 151J(2)(d) which would
allow the Governor-General to terminate the Workplace Authority Director's appointment if the
requirements of proposed section 151F are contravened without reasonable excuse.
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Schedule 2 - Workplace Authority
Section 151G - Acting appointments
280. Proposed section 151G would allow the Minister to appoint a person to act as the
Workplace Authority Director when necessary, including on a recurring basis. The Minister
would need to be satisfied that any person appointed to act in this position has suitable
qualifications or experience and is of good character (proposed subsection 151G(2)).
281. Proposed subsection 151G(3) would provide that anything done by a person appointed to
act in the Workplace Authority Director's position would not be invalid simply because of a
defect or irregularity in connection with the appointment.
Section 151H - Resignation
282. Proposed section 151H would allow the Workplace Authority Director to resign from his
or her appointment by giving a written resignation to the Governor-General. The resignation
would take effect either on the day the resignation is received, or a later date where specified
(proposed subsection 151H(2)).
Section 151J - Termination of appointment
283. Proposed section 151J would provide grounds for termination of the appointment of the
Workplace Authority Director.
284. Proposed subsection 151J(1) would allow the Governor-General to terminate the
appointment of the Workplace Authority Director for misbehaviour or physical or mental
incapacity.
285. Proposed subsection 151J(2) would allow the Governor-General to terminate the
appointment of the Workplace Authority Director if the Workplace Authority Director:
· becomes bankrupt or takes specified steps related to insolvency; or
· is absent from duty (except on authorised leave) for 14 consecutive days or for 28 days in
any 12 month period; or
· engages in unapproved paid employment outside the duties of his or her office; or
· fails to disclose pecuniary or other interests that could conflict with the proper
performance of his or her functions (proposed section 151F) without reasonable excuse.
Division 2 - Workplace Authority Deputy Directors
286. Proposed Division 2 would provide for the arrangements for the appointment and
entitlements of Workplace Authority Deputy Directors. The function of the Workplace Authority
Deputy Directors is to assist the Workplace Authority Director in the performance of his or her
functions.
287. It would be expected that many of the functions and powers of the Workplace Authority
Director would be delegated to Workplace Authority Deputy Directors under proposed section
153C (for example to decide under proposed Division 5A of Part 8 whether workplace
agreements pass the fairness test or to promote an understanding of Commonwealth workplace
relations legislation).
Section 152A - Workplace Authority Deputy Directors
288. Proposed section 152A would provide for the Workplace Authority Director to be assisted
in his or her functions by Workplace Authority Deputy Directors.
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Schedule 2 - Workplace Authority
Section 152B - Appointment of Workplace Authority Deputy Director
289. Proposed subsection 152B(1) would provide for the Minister to appoint Workplace
Authority Deputy Directors by written instrument.
290. Proposed subsection152B(2) would require that, before the Minister may appoint a person
as a Workplace Authority Deputy Director, the Minister must be satisfied that the person has
suitable qualifications or experience, and is of good character.
291. The length of an appointment would be specified in the written instrument of appointment,
but cannot exceed 5 years (proposed subsection 152B(3)). A Workplace Authority Deputy
Director would be appointed on a full-time or part-time basis (proposed subsection 152B(4)). A
Workplace Authority Deputy Director can be reappointed for a further term.
Section 152C - Remuneration
292. Proposed subsection 152C(1) would provide that the Remuneration Tribunal would
determine the remuneration of a Workplace Authority Deputy Director or, in the absence of a
determination, the regulations could set the remuneration. In addition, Workplace Authority
Deputy Directors would be paid any allowances prescribed by regulation (proposed subsection
152C(2)).
293. Proposed subsection 152C(3) would provide that this section has effect subject to the
Remuneration Tribunal Act 1973. This would ensure that general provisions of the
Remuneration Tribunal Act 1973 are not displaced by this section.
Section 152D - Leave of absence
294. Proposed subsection 152D(1) would provide that the Remuneration Tribunal would
determine the recreation leave entitlements for a full-time Workplace Authority Deputy Director.
295. Proposed subsection 152D(2) would allow the Minister to grant a full-time Workplace
Authority Deputy Director leave of absence, other than recreation leave, on such terms and
conditions as he or she determines.
296. Proposed subsection 152D(3) would allow the Minister to grant a part-time Workplace
Authority Deputy Director leave of absence on such terms and conditions as he or she
determines.
Section 152E - Other terms and conditions
297. Proposed section 152E would provide that the Minister may determine terms and
conditions relating to matters not covered by the Act for the office of Workplace Authority
Deputy Directors.
Section 152F - Outside employment
298. Proposed subsection 152F(1) would provide that a full-time Workplace Authority Deputy
Director cannot engage in other paid employment without the Minister's approval.
299. Proposed subsection 152F(2) would provide that a part-time Workplace Authority Deputy
Director must not engage in any other paid employment that conflicts or may conflict with the
proper performance of his or her duties.
300. These arrangements are complemented by proposed paragraphs 152J(2)(c) and (d) which
would allow the Minister to terminate a Workplace Authority Deputy Director's appointment if
the requirements of subsection 152F are contravened.
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Schedule 2 - Workplace Authority
Section 152G - Disclosure of interests
301. Proposed section 152G would require a Workplace Authority Deputy Director to give the
Minister written notice of all pecuniary or other interests that could conflict with performance of
the Workplace Authority Deputy Director's functions.
302. These arrangements are complemented by proposed paragraph 152J(2)(e) which would
allow the Minister to terminate a Workplace Authority Deputy Director's appointment if the
requirements of proposed section 152G are contravened.
Section 152H - Resignation
303. Proposed subsection 152H(1) would allow a Workplace Authority Deputy Director to
resign from his or her appointment by giving a written resignation to the Minister. The
resignation would take effect either on the day the resignation is received, or a later date where
specified (proposed subsection 152H(2)).
Section 152J - Termination of appointment
304. Proposed section 152J would provide grounds for termination of the appointment of a
Workplace Authority Deputy Director.
305. Proposed subsection 152J(1) would allow the Minister to terminate the appointment of a
Workplace Authority Deputy Director for misbehaviour or physical or mental incapacity.
306. Proposed subsection 152J(2) would allow the Minister to terminate the appointment of a
Workplace Authority Deputy Director if the Workplace Authority Deputy Director:
· becomes bankrupt or takes specified steps related to insolvency; or
· is engaged on a full-time basis and is absent from duty (except on authorised leave) for
14 consecutive days or for 28 days in any 12 month period; or
· is engaged on a full-time basis and engages in unapproved paid employment outside the
duties of his or her office;
· is engaged on a part-time basis and engages in paid employment that conflicts or could
conflict with the proper performance of the duties of his or her office; or
· fails to comply with proposed section 152G, without reasonable excuse.
Division 3 - Staff, delegations etc.
307. Proposed Division 3 would establish the Workplace Authority as a statutory agency,
provide the delegation of his or her functions and provide for the engagement of staff to assist
the Workplace Authority Director.
Section 153A - Staff
308. Proposed section 153A would require that staff assisting the Workplace Authority Director
in the performance of the Workplace Authority Director's functions must be engaged under the
Public Service Act 1999.
Section 153B - Workplace Authority
309. Proposed subsection 153B(1) would provide for the establishment of the Workplace
Authority.
310. Proposed subsection 153B(2) would provide that the Workplace Authority consist of:
· the Workplace Authority Director;
· the Workplace Authority Deputy Directors; and
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Schedule 2 - Workplace Authority
· the staff necessary to assist the Workplace Authority Director.
311. Proposed subsection 153B(3) would provide that the Workplace Authority would be a
Statutory Agency for the purposes of the Public Service Act 1999, headed by the Workplace
Authority Director.
Section 153C - Delegation
312. Proposed subsection 153C(1) would allow the Workplace Authority Director to delegate
any of his or her powers and functions to a person appointed or employed by the
Commonwealth.
313. Given the broad functions of the Workplace Authority Director, proposed subsection
153C(1) does not impose limitations on the categories of persons who may exercise delegated
powers or functions of the Workplace Authority Director. The Workplace Authority Director
would of course be expected to only to choose delegates suitably qualified to exercise particular
powers or functions.
314. For example, it would expected that the function of providing education, assistance and
advice to employees, employers and organisations in relation to their rights and obligations
under Commonwealth workplace relations legislation would be delegated more broadly.
However, deciding under Division 5A of Part 8 whether workplace agreements pass the fairness
test may be a more restricted delegation.
315. In exercising delegated powers or functions the delegate would be required to comply with
any directions given by the Workplace Authority Director (proposed subsection 153C(2)).
Item 3 - Division 3 of Part 5 (heading)
316. This item would repeal the heading and substitute `Division 4 - Reporting and disclosing
information'.
Item 4 - Before section 165
317. This item would insert a new Subdivision A relating to reporting and a new Subdivision B
relating to disclosing of information.
Division 4 - Reporting and disclosing information
Subdivision A - Reporting
318. Proposed Subdivision A would set out requirements for the Workplace Authority Director
to report to the Minister.
Section 163A - Minister may require reports
319. Proposed subsection 163A(1) would allow the Minister to direct the Workplace Authority
Director to provide specified reports relating to the Workplace Authority Director's functions.
The Workplace Authority Director would be required to comply with the direction (subsection
163A(2)).
320. Proposed subsections 163A(3) and (4) are included to assist the public to understand that a
direction by the Minister given under proposed section 163A or a report given under that section,
would not be a legislative instrument within the meaning of section 5 of the Legislative
Instruments Act 2003.
Section 163B - Annual report
321. Proposed section 163B would require the Workplace Authority Director to provide an
annual report to the Minister on the operations of the Workplace Authority for each financial
Senate page 52 Workplace Relations Amendment
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Schedule 2 - Workplace Authority
year. The report must be prepared "as soon as practicable" after the end of the financial year.
The report would be presented to Parliament.
322. A legislative note directs the reader to section 34C of the Acts Interpretation Act 1901 for
additional requirements relating to annual reports.
Section 163C - Reports not to include information relating to an individual's affairs
323. Proposed subsection 163C(1) would provide that information relating to the affairs of an
individual may not be included in a report under proposed sections 163A or 163B if the
individual has been named or otherwise specifically identified as the individual to whom the
information relates or it is reasonably likely that people generally would be able to ascertain the
identity of the person.
324. Proposed subsection 163C(2) would provide relevant factors that must be taken into
account in determining whether it is reasonably likely a person could be identified by people
generally, i.e. the context in which the information appears, any other publicly available
information and any other relevant matter.
Subdivision B - Disclosing information
325. Proposed Subdivision B would provide for disclosure of information by workplace
agreement officials in certain circumstances.
326. A workplace agreement official would be defined to mean the Workplace Authority
Director (or a delegate thereof), or a Workplace Authority Deputy Director, or a member of the
Workplace Authority.
Section 164A - Disclosure of information by workplace agreement officials
327. Proposed subsection 164A(1) would allow a workplace agreement official to disclose
information acquired in the course of exercising powers, or performing functions, as an official,
if he or she considers on reasonable grounds that it is necessary or appropriate to do so in the
course of exercising his or her powers, or performing his or her functions, as a workplace
agreement official.
328. Proposed subsection 164A(2) would allow a workplace agreement official to provide the
Minister with aggregated statistical data and information and copies of documents in accordance
with regulations. A regulation made under proposed subsection 164A(3) may require
information to be deleted from copies of documents provided to the Minister, as necessary to
prevent individuals being identified (proposed subsection 164A(3)).
329. Proposed subsection 164A(4) would allow a workplace agreement official to disclose
information to the Workplace Ombudsman or workplace inspectors where information has been
requested by, and relates to the functions of, the Workplace Ombudsman or workplace
inspectors, respectively. The Workplace Authority Director would also be allowed to disclose
information to the Workplace Ombudsman or workplace inspectors if the Workplace Authority
Director considers, on reasonable grounds, that the information would assist the Workplace
Ombudsman or workplace inspectors in performing their functions (proposed paragraph
164A(4)(c)).
330. Proposed subsection 164A(5) would allow regulations to prescribe persons to whom a
workplace agreement official could disclose prescribed kinds of information for prescribed
purposes.
331. Proposed subsection 164A(6) would allow regulations to prescribe persons to whom a
workplace agreement official could not disclose prescribed kinds of information for prescribed
purposes, despite proposed subsections 164A(1), (2) and (4).
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Schedule 2 - Workplace Authority
332. Proposed subsection 164A(7) would provide that workplace agreement officials would not
be able to disclose information to the Minister that relates to a decision under Division 5A of
Part 8:
· whether a particular workplace agreement passes the fairness test; or
· whether a particular workplace agreement is subject to the fairness test.
333. Proposed section 164A would provide an authorisation for disclosure of information
pursuant to Information Privacy Principle 11(1)(d) of the Privacy Act 1988.
334. Proposed subsection 164A(8) would confirm that a disclosure of personal information in
accordance with section 154A would be taken as authorised by law for the purpose of the
Privacy Act 1988.
335. Proposed subsection 164A(9) would confirm that disclosure of protected information (as
defined in section 165) under this section would, for the purposes of section 165, be taken as
permitted by the Act.
Part 2-Consequential Amendments
Division 1-Workplace Relations Act 1996
336. Division 1 proposes amendments to the Act, including to definitions, primarily of a minor
or technical nature and consequential to the main amendments in Part 1 to Schedule 2. These
amendments would primarily relate to updating definition sections and replacing references to
the `Employment Advocate' with `Workplace Authority Director'.
Item 5 - Subsection 4(1) (definition of Employment Advocate)
337. This item would repeal the definition of Employment Advocate.
Item 6 - Subsection 4(1)
338. This item would define a member of the Workplace Authority as a person covered by
proposed subsection 153B(2).
Item 7 - Subsection 4(1)
339. This item would define a workplace agreement official, as meaning:
· the Workplace Authority Director (or a delegate);
· a Workplace Authority Deputy Director; or
· a staff member of the Workplace Authority.
Item 8 - Subsection 4(1)
Item 9 - Subsection 4(1)
340. Items 8 and 9 would insert definitions for Workplace Authority Deputy Director and
Workplace Authority Director.
Item 10 - Paragraph 120(3)(e)
341. This item would repeal the paragraph and substitute a paragraph that provides for the
Workplace Authority Director to institute an appeal to the Full Bench in relation to a decision by
the Australian Industrial Relations Commission to vary, or not to vary, an award.
Item 11 - Subsection 165(2) (definition of workplace agreement official)
342. This item would repeal the definition of workplace agreement official.
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Schedule 2 - Workplace Authority
Item 12 - Sections 166, 332, 335, 337, 344, 345, 346A, 357 and 358
Item 13 - Subsection 359(1)
Item 14 - Subsection 359(2)
Item 15 - Sections 360, 361, 363, 370, 377, 378, 380, 381, 384, 389, 390, 392, 393, 395, 396,
416, 417, 418, 578, 583, 585, 595, 598A, 603, 603B and 604
343. These items would omit references to `Employment Advocate' and substitute `Workplace
Authority Director'.
Item 16 - Section 6 of Schedule 1 (definition of Employment Advocate)
344. This item would repeal the definition of Employment Advocate.
Item 17 - Subparagraph 337A(b)(ii) of Schedule 1
345. This item would repeal subparagraph 337A(b)(ii) of Schedule 1 and substitute `a
workplace agreement official' (as defined in the Act).
Item 18 - Paragraphs 2(2)(m), (n) and (o) of Schedule 2
Item 19 - Paragraphs 3(2)(f), (g) and (h) of Schedule 2
Item 20 - Paragraphs 4(2)(m) and (n) of Schedule 2
346. These items would ensure that references to `employee', `employer' and `employment'
have their ordinary meaning when used in relation to the functions of the Workplace Authority
Director.
Item 21- Clauses 72B, 72G, 72K and 72L of Schedule 6
Item 22 - Clauses 9 and 15B of Schedule 8
Item 23 - Subclause 19(1) of Schedule 8
Item 24 - Subclause 19(2) of Schedule 8
Item 25 - Subclause 19(3), (5), (9), (10), (11) and (12) of Schedule 8
Item 26 - Subclause 42(1) of Schedule 8
Item 27 - Subclause 42(2) of Schedule 8
Item 28 - Subclauses 42(3), (5), (9), (10), (11) and (12) of Schedule 8
Item 29 - Clauses 2, 7, 10, 19, 27A, 29, 29B and 30 of Schedule 9
347. These items are consequential amendments and omit references to `Employment Advocate'
or `Employment Advocate's' and substitute `Workplace Authority Director' or `Workplace
Authority Director's'.
Division 2 - Other legislation
348. Division 2 proposes amendments to the Coal Mining Industry (Long Service Leave
Funding) Act 1992 and the Financial Management and Accountability Regulations 1997
consequential on the amendments to the Act.
Coal Mining Industry (Long Service Leave Funding) Act 1992
Item 30 - Subsection 4(1) (definition of industrial authority)
349. This item would amend the Coal Mining Industry (Long Service Leave Funding) Act 1992
to include "the Workplace Authority Director" in the definition of industrial authority.
Senate page 55 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 2 - Workplace Authority
Financial Management and Accountability Regulations 1997
Item 31 - At the end of Part 1 of Schedule 1
350. This item would amend the Financial Management and Accountability Regulations 1997
to prescribe the Workplace Authority as a prescribed agency for purposes of the Financial
Management and Accountability Act 1997.
Part 3-Transitional Provisions
351. Part 3 would provide for transitional arrangements in relation to matters that were, prior to
commencement of the proposed amendments, the responsibility of the Employment Advocate
and which would become the responsibility of the Workplace Authority Director.
Item 32 - General transitional provision
352. This item would provide that, for the purposes of the operation of an Act, or an instrument
(including regulations) or agreement made under an Act, in relation to a time on or after
commencement of this Schedule, anything done by the Employment Advocate before
commencement of the Schedule would be taken to be done by the Workplace Authority Director.
Item 33 - Substitution of parties to proceedings
353. This item would provide that the Workplace Authority Director would substitute the
Employment Advocate as a party in any court or tribunal proceedings that were pending
immediately before commencement of the Schedule.
Item 34 - Gazette notices of requirements
354. This item would ensure that requirements set by the Employment Advocate in accordance
with certain provisions of the Act, that were published in the Gazette and in force immediately
prior to the amendments, would remain in effect after commencement of this Schedule. The
requirements relate to form and content of information statements, notices and declarations
relating to pre-lodgment and lodgment procedures for the making, variation and termination of
workplace agreements.
355. Subitem 34(3) would provide that the item would not prevent amendment or revocation of
such a requirement.
Item 35 - Workplace agreement officials
356. Subitem 35(1) would provide that a person taken to be a workplace agreement official for
the purpose of section 165 (which provides for an offence in relation to disclosure of certain
information relating to parties of an Australian Workplace Agreement), prior to commencement
of the amendments, would continue to be a workplace agreement official after the amendments.
357. Subitem 35(2) would clarify that this item does not limit the amended definition of
workplace agreement official under subsection 4(1) of the Act.
Item 36 - Annual report on Employment Advocate's operations
358. This item is a transitional item relating to the annual reporting requirement for the
Employment Advocate under section 155 of the Act. The item would confirm that an annual
report on the Employment Advocate's operations for the year of repeal (or financial year
proceeding repeal), would be required, despite repeal of section 155. The Workplace Authority
Director would be required to prepare the report.
Senate page 56 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
Schedule 3 - Workplace Ombudsman
Part 1-Amendments
Division 1-Main amendments
Workplace Relations Act 1996
Item 1 - Subsection 4(1)
Item 2 - Subsection 4(1)
Item 3 - Subsection 4(1) (definition of workplace inspector)
Item 4 - Subsection 4(1)
359. Proposed items 1, 2 and 4 would amend the general definitions provision of the Act to
include definitions of Commonwealth workplace relations legislation, member of the Office of
the Workplace Ombudsman and Workplace Ombudsman.
360. The proposed definition of Commonwealth workplace relations legislation would define
the expression to mean the Workplace Relations Act 1996, the Independent Contractors Act
2006 and any regulations made under the Independent Contractors Act 2006. The legislative
note would make clear that the definition of Commonwealth workplace relations legislation does
not cover the Registration and Accountability of Organisations Schedule or regulations made
under that Schedule, because the definition of this Act excludes them both. However, the
definition of `this Act' includes regulations made under the Act).
361. The proposed definition of Workplace Ombudsman would mean the Workplace
Ombudsman holding office under Part 5A.
362. The proposed definition of member of the Office of the Workplace Ombudsman would
mean a person covered by subsection 166P(2).
363. Proposed item 3 would replace the definition of workplace inspector with a new definition
defined to mean a person who is a workplace inspector under section 167. A transitional
amendment made by item 18 would ensure that a workplace inspector appointed under section
167(2) of the Act prior to commencement of this Schedule would remain in effect after
commencement of this Schedule.
Item 5 - After Part 5
364. Proposed item 5 would insert new Part 5A in the Act to provide for the appointment of the
Workplace Ombudsman. This Part would also establish the Office of the Workplace
Ombudsman as a statutory agency.
365. The Workplace Ombudsman would provide additional protection for workers by ensuring
that employers comply with their obligations under Commonwealth workplace relations
legislation.
366. The Workplace Ombudsman would have a range of powers to ensure that all parties under
the federal workplace relations system comply with Commonwealth workplace relations
legislation (as defined). For example, the Workplace Ombudsman would be able to investigate
alleged breaches, undertake compliance audits and prosecute breaches.
Senate page 57 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
Part 5A - Workplace Ombudsman
Division 1 - Establishment and functions
367. This Division would provide for the appointment of the Workplace Ombudsman to head
the Office of the Workplace Ombudsman and set out his or her functions.
Section 166A - Workplace Ombudsman
368. Proposed section 166A would establish the statutory office of the Workplace Ombudsman.
Proposed section 166D would provide for the Workplace Ombudsman to be appointed by the
Governor-General.
Section 166B - Functions of the Workplace Ombudsman
369. Proposed section 166B would set out the Workplace Ombudsman's broad functions.
These are to:
· assist employees and employers understand their obligations under Commonwealth
workplace relations legislation;
· monitor and promote compliance with Commonwealth workplace relations legislation;
· investigate suspected contraventions of Commonwealth workplace relations legislation;
· inquire into any act or practice that may be inconsistent with or contrary to Commonwealth
workplace relations legislation;
· refer matters to relevant authorities;
· institute proceedings to enforce Commonwealth workplace relations legislation;
· appoint and give directions to workplace inspectors;
· represent an employee in a proceeding where the Workplace Ombudsman considers that
providing the representation would promote compliance with this Act; and
· any other function conferred by Commonwealth workplace relations legislation.
370. Relevant authorities that may have matters referred to include agencies and bodies.
371. The legislative note to section 166B would make it clear that the Workplace Ombudsman
also has the functions and powers of a workplace inspector.
Section 166C - Minister may give directions to Workplace Ombudsman
372. Proposed section 166C would allow the Minister to give written directions to the
Workplace Ombudsman about the performance of his or her functions. These directions would
be a legislative instrument under the Legislative Instruments Act 2003 and subject to public
scrutiny.
373. Such directions must be of a general nature, for example to focus on helping ensure that
employers are meeting their obligations to young working Australians. The Minister would be
expressly precluded from giving directions in relation to a specific case or in relation to the
Workplace Ombudsman's performance of functions, or exercise of powers as an Agency head
under the Public Service Act 1999 (proposed subsections 166C(2) and 166C(3)). This restriction
ensures the independence of the Workplace Ombudsman.
374. The Workplace Ombudsman would be required to comply with any direction given by the
Minister under this provision (proposed subsection 166C(4)).
Senate page 58 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
375. Despite section 44 of the Legislative Instruments Act 2003, which provides that Ministerial
directions are not disallowable, proposed subsection 166C(5) expressly provides that a direction
by the Minister would be a disallowable instrument.
Division 2 - Appointment and terms and conditions
376. This Division would provide for the appointment and entitlements of the Workplace
Ombudsman.
Section 166D - Appointment of Workplace Ombudsman
377. Proposed section 166D would provide for the Governor-General to appoint the Workplace
Ombudsman by written instrument.
378. Proposed subsection 166D(2) would require that before the Governor-General may appoint
a person as the Workplace Ombudsman, the Minister must be satisfied that the person has
suitable qualifications or experience, and is of good character.
379. The length of an appointment would be specified in the written instrument of appointment,
but cannot exceed 5 years (proposed subsection 166D(3)). The Workplace Ombudsman would
be appointed on a full-time basis (proposed subsection 166D(4)). The Workplace Ombudsman
could be reappointed for a further term.
Section 166E - Remuneration
380. Proposed subsection 166E(1) would provide that the Remuneration Tribunal would
determine the remuneration of the Workplace Ombudsman or, in the absence of a determination,
the regulations could set the remuneration. In addition, the Workplace Ombudsman would be
paid any allowances prescribed by regulation (subsection 166E(2)).
381. Proposed subsection 166E(3) would provide that this section has effect subject to the
Remuneration Tribunal Act 1973. This would ensure that general provisions of the
Remuneration Tribunal Act 1973 are not displaced by this section.
Section 166F - Leave of absence
382. Proposed section 166F would provide that the Remuneration Tribunal would determine the
recreation leave entitlements for the Workplace Ombudsman.
383. Proposed subsection 166F(2) would allow the Minister to grant the Workplace
Ombudsman leave of absence, other than recreation leave, on such terms and conditions as he or
she determines.
Section 166G - Other terms and conditions
384. Proposed section 166G would provide that the Governor-General may determine terms and
conditions relating to matters not covered by the Act in relation to the Workplace Ombudsman.
Section 166H - Outside employment
385. Proposed section 166H would provide that the Workplace Ombudsman cannot engage in
other paid employment without the Minister's approval.
386. These arrangements are complemented by proposed paragraph 166M(2)(c) which would
allow the Governor-General to terminate the Workplace Ombudsman's appointment if the
requirements of proposed subsection 166H are contravened.
Senate page 59 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
Section 166J - Disclosure of interests
387. Proposed section 166J would require the Workplace Ombudsman to give the Minister
written notice of all pecuniary or other interests that could conflict with the proper performance
of the Workplace Ombudsman's functions.
388. These arrangements are complemented by proposed paragraph 166M(2)(d) which would
allow the Governor-General to terminate the Workplace Ombudsman's appointment if the
requirements of section 166J are contravened without reasonable excuse.
Section 166K - Acting appointments
389. Proposed section 166K would allow the Minister to appoint a person to act as the
Workplace Ombudsman when necessary, including on a recurring basis. The Minister would
need to be satisfied that any person appointed to act in this position has suitable qualifications or
experience and is of good character (proposed subsection 166K(2)).
390. Proposed subsection 166K(3) would provide that anything done by a person appointed to
act in the Workplace Ombudsman's position would not be invalid only because of a defect or
irregularity in connection with the appointment.
Section 166L - Resignation
391. Proposed section 166L would allow the Workplace Ombudsman to resign from his or her
appointment by giving a written resignation to the Governor-General. The resignation would
take effect either on the day the resignation is received, or a later specified date (subsection
166L(2)).
Section 166M - Termination of appointment
392. Proposed section 166M would provide grounds for termination of the appointment of the
Workplace Ombudsman.
393. Subsection 166M(1) would allow the Governor-General to terminate the appointment of
the Workplace Ombudsman for misbehaviour or physical or mental incapacity.
394. Proposed subsection 166M(2) would allow the Governor-General to terminate the
appointment of the Workplace Ombudsman if the Workplace Ombudsman:
· becomes bankrupt or takes specified steps related to insolvency; or
· is absent from duty (except on authorised leave) for 14 consecutive days or for 28 days in
any 12 month period; or
· engages in unapproved paid employment outside the duties of his or her office; or
· fails to disclose pecuniary or other interests that could conflict with the proper
performance of his or her functions without reasonable excuse (proposed section 166J).
Division 3 - Staff, delegations etc.
395. Proposed Division 3 would establish the Office of the Workplace Ombudsman as a
statutory agency, provide for the delegation of the Workplace Ombudsman's functions and
powers and provide for the engagement of staff to assist the Workplace Ombudsman.
Section 166N - Staff
396. Proposed section 166N would require that staff assisting the Workplace Ombudsman in the
performance of his or her functions must be engaged under the Public Service Act 1999.
Senate page 60 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
Section 166P - Office of the Workplace Ombudsman
397. Proposed section 166P would provide for the establishment of the Office of the Workplace
Ombudsman.
398. Proposed subsection 166P(2) would provide that the Office of the Workplace Ombudsman
would consist of:
· the Workplace Ombudsman;
· staff assisting the Workplace Ombudsman; and
· workplace inspectors appointed under section 167.
399. Proposed subsection 166P(3) would provide that the Workplace Ombudsman and the staff
assisting the Workplace Ombudsman would be a Statutory Agency for the purposes of the Public
Service Act 1999, headed by the Workplace Ombudsman.
Section 166Q - Delegation
400. Proposed section 166Q would allow the Workplace Ombudsman to delegate any of his or
her functions and powers under Commonwealth workplace relations legislation to a Senior
Executive Service (SES) employee, or acting SES employee in the Office of the Workplace
Ombudsman.
401. In exercising delegated powers or functions the delegate would be required to comply with
any direction given by the Workplace Ombudsman (subsection 166Q(2)).
402. Proposed subsection 166Q(3) would provide that the Workplace Ombudsman cannot
delegate the functions and powers of a workplace inspector which the Workplace Ombudsman
has because of section 167.
403. The legislative note to proposed subsection 166Q(3) would make it clear that the
Workplace Ombudsman is able to appoint an SES employee or acting SES employee as a
workplace inspector under section 167. This would allow the SES employee or acting SES
employee to exercise any of the powers or functions of a workplace inspector.
Division 4 - Reporting and disclosing information
404. This Division would provide for the reporting and disclosing of information by the
Workplace Ombudsman.
Subdivision A - Reporting to Minister
Section 166R - Minister may require reports
405. Proposed section 166R would allow the Minister to direct the Workplace Ombudsman to
provide specified reports relating to the Workplace Ombudsman's functions. For example, the
Minister could request a report on activities associated with a direction under proposed section
166C (i.e. to focus on helping ensure that employers are meeting their obligations to young
working Australians). Similarly, the Minister to direct the Workplace Ombudsman to report on
compliance audits in particular industries. The Workplace Ombudsman would be required to
comply with the direction (proposed subsection 166R(2)).
406. Proposed subsections 166R(3) and (4), are included to assist the public understand that a
direction by the Minister under proposed section 166R or a report given under that section would
not be a legislative instrument within the meaning of section 5 of the Legislative Instruments Act
2003.
Senate page 61 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
Section 166S - Annual report
407. Proposed section 166S would require the Workplace Ombudsman to provide an annual
report on the operations of the Office of the Workplace Ombudsman for each financial year. The
report must be prepared "as soon as practicable" after the end of the financial year. The report
would be presented to Parliament.
408. A legislative note directs the reader to section 34C of the Acts Interpretation Act 1901 for
additional requirements relating to annual reports
Section 166T - Reports not to include information relating to an individual's affairs
409. Proposed section 166T would provide that information relating to the affairs of an
individual must not be included in a report to the Minister under sections 166R or 166S if the
individual has been named or otherwise specifically identified as the individual to whom the
information relates or it is reasonably likely that people generally would be able to ascertain the
identity of the person.
410. Proposed subsection 166T(2) would provide relevant factors that must be taken into
account in determining whether it is reasonably likely that a person could be identified by people
generally, i.e. the context in which the information appears, any other publicly available
information and any other relevant matter.
Subdivision B - Disclosing information
411. Proposed Subdivision B would provide for disclosure of information by a member of the
Office of the Workplace Ombudsman, in certain circumstances.
412. A member of the Office of the Workplace Ombudsman would be defined to mean a person
covered by proposed subsection 166P(2), namely the Workplace Ombudsman (or a delegate),
staff assisting the Workplace Ombudsman, and the appointed workplace inspectors.
Section 166U - Disclosure of information by members of the Office of the Workplace
Ombudsman
413. Proposed section 166U would set out circumstances in which a member of the Office of
Workplace Ombudsman could disclose information.
414. Proposed subsection 166U(1) would allow a member of the Office of the Workplace
Ombudsman to disclose information in the course of exercising powers, or performing functions,
as such a member, if he or she considers on reasonable grounds that it is necessary or appropriate
to do so in the course of exercising his or her powers, or performing his or her functions, as a
member.
415. Proposed subsection 166U(2) would allow a member of the Office of the Workplace
Ombudsman to disclose information to an officer of the Department administered by the
Minister who administers the Migration Act 1958 if he or she considers on reasonable grounds
that the disclosure of the information is likely to assist the officer in the administration of that
Act.
416. Proposed subsection 166U(3) would allow regulations to prescribed persons to whom
members of the Office of the Workplace Ombudsman could disclose prescribed kinds of
information for prescribed purposes.
417. Proposed subsection 166U(4) would allow a member of the Office of the Workplace
Ombudsman to disclose information to an officer of a State who has powers or functions in
relation to the administration of a workplace relations or other employment related system, if he
Senate page 62 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
or she considers on reasonable grounds that the disclosure of the information is likely to assist
the officer in the administration of that system.
418. Proposed subsection 166U(5) would allow a member of the Office of the Workplace
Ombudsman to disclose information to a person appointed to or employed by the
Commonwealth, a State or a Territory, or an authority of the Commonwealth, a State or Territory
if he or she considers on reasonable grounds that the disclosure of the information is likely to
assist the person or authority in discharging a responsibility relating to the administration of a
Commonwealth, State or Territory law.
419. Proposed section 166U would provide an authorisation for disclosure of information
pursuant to Information Privacy Principle 11(1)(d) of the Privacy Act 1988. Subsection 166U(6)
would confirm that a disclosure of personal information in accordance with proposed section
166U is taken to be authorised by law for the purposes of the Privacy Act 1988.
Section 166V - Directions about the exercise of powers to disclose information
420. Proposed section 166V would allow the Workplace Ombudsman to give written directions,
by legislative instrument, about the disclosure of information under proposed section 166U.
421. Any directions given under this section would only be of a general nature only (proposed
subsection 166V(2)) and a member of the Office of the Workplace Ombudsman would be
required to comply with such a direction (proposed subsection 166V(3)).
Item 6 - After subsection 167(1)
Item 7 - Subsection 167(2)
Item 8 - Subsections 167(7) and (8)
Item 9 - Subsection 168(1)
Item 10 - Subsection 168(1)
Item 11 - Paragraph 168(3)(b)
Item 12 - Section 170
422. Items 6, 7, 8, 9, 10, 11, and 12, would make amendments that are consequential to the
Workplace Ombudsman's function to appoint and give directions to workplace inspectors.
423. Item 6 would insert subsection 167(1A) to provide that the Workplace Ombudsman is also
a workplace inspector.
424. Item 7 would omit "Minister" and substitute "Workplace Ombudsman" in subsection
167(2).
425. Item 8 would repeal subsections 167(7) and (8) and replace them with new subsections.
426. Proposed subsection 167(7) would provide that a workplace inspector must comply with
any directions of the Workplace Ombudsman.
427. Proposed subsection 167(8) would provide that if a direction under subsection 167(7) is of
general application, the direction is a legislative instrument within the meaning of section 5 of
the Legislative Instruments Act 2003.
428. Proposed subsection 167(9) would provide that if a direction under subsection 167(7)
relates to a particular case, the direction is not a legislative instrument within the meaning of
section 5 of the Legislative Instruments Act 2003.
Senate page 63 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
429. Item 9 would omit "Minister" and substitute "Workplace Ombudsman" in subsection
168(1).
430. Item 10 would omit "prescribed form" and substitute "form approved by the Workplace
Ombudsman" in subsection 168(1).
431. Item 11 would omit "Secretary of the Department" and substitute "Workplace
Ombudsman" in paragraph 168(3)(b).
432. Item 12 would repeal section 170 of the Act. This section would be replaced by proposed
section 166U.
Item 13 - Subparagraph 337A(b)(v) of Schedule 1
433. Item 13 would repeal subparagraph 337A(b)(v) of Schedule 1 of the Act, which referred to
a `workplace inspector' and insert `a member of the Office of the Workplace Ombudsman' into
that paragraph. This would ensure that a whistleblower who discloses information to a member
of the Office of the Workplace Ombudsman is protected.
Item 14 - Before paragraph 2(2)(p) of Schedule 2
434. This item would insert paragraphs 2(2)(oa) and 2(2)(ob) into Schedule 2 of the Act to
ensure that the references to employee in this Schedule are given its ordinary meaning.
Item 15 - Before paragraph 3(2)(i) of Schedule 2
435. This item would insert paragraph 3(2)(ha) into Schedule 2 of the Act to ensure the
reference to employment in this Schedule is given its ordinary meaning.
Item 16 - Paragraph 4(2)(o) of Schedule 2
436. This item would repeal paragraph 4(2)(o) of Schedule 2 of the Act and insert paragraphs
4(2)(o), 4(2)(oa) and 4(2)(ob) to ensure that references to employment in this Schedule are given
its ordinary meaning.
Division 2-Consequential amendment
Financial Management and Accountability Regulations 1997
Item 17 - Part 1 of Schedule 1 (after table item 140AA)
437. This item would amend the Financial Management and Accountability Regulations 1997
to prescribe the Office of the Workplace Ombudsman as a prescribed agency for purposes of the
Financial Management and Accountability Act 1997.
Part 2-Transitional and application provisions
Item 18 - Workplace inspectors
438. This item would ensure that appointments of workplace inspectors made under subsection
167(2) of the Act prior to commencement of this Schedule would remain in effect after
commencement of this Schedule.
Item 19 - Identity cards
439. This item would ensure that identity cards issued under subsection 168(1) of the Act prior
to commencement of this Schedule would remain in effect after commencement of this
Schedule.
Senate page 64 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 3 - Workplace Ombudsman
Item 20 - Disclosures qualifying for whistleblowers' protection
440. This item would ensure that protection for a person who discloses information to a
workplace inspector under Part 4A of Chapter 11 of Schedule 1 to the Act would remain in
effect after commencement of this Schedule.
Senate page 65 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 4 - Prohibited content
Schedule 4 - Prohibited Content
Workplace Relations Act 1996
Item 1 - Subsection 4(2)
Item 2 - Section 356
441. Section 356 of the Act currently provides that the Regulations may specify matters that are
prohibited content for the purposes of the Act. A workplace agreement must not be lodged if it
contains prohibited content and a term of the workplace agreement is void to the extent that it
contains prohibited content.
442. Item 2 would repeal and replace existing section 356. Proposed section 356 would provide
that prohibited content is matters set out in paragraphs 356(1)(a) to 356(1)(e) plus any matters
specified in the Regulations (proposed paragraph 356(1)(f)).
443. The matters that would be listed as prohibited content in the Act are provisions that:
· require or permit conduct that would contravene the freedom of association provisions
outlined in Part 16 of the Act (proposed paragraph 356(1)(a)). The freedom of association
provisions protect the right of a person to freely choose whether or not to belong to a
union;
· directly or indirectly require a person to encourage or discourage another person to
become, or remain, a member of an industrial association (paragraph 356(1)(b));
· indicate support or opposition for persons becoming members of an industrial association
(proposed paragraphs 356(1)(c) and 356(1)(d)); and
· require or permit payment of a bargaining services fee. This would mean that, for
example, any clause that required non-union employees to pay a union an annual fee for
negotiating an agreement would be prohibited content (proposed paragraph 356(1)(e)).
444. Each of the matters listed in paragraphs 356(1)(a) to 356(1)(d) is already prohibited
content. Regulations made under existing section 356 provide that a term of a workplace
agreement is prohibited content to the extent that it is an objectionable provision within the
meaning of the Act (subregulation 8.5(7)). What constitutes an objectionable provision is set out
in section 810 of the Act.
445. Proposed paragraphs 356(1)(a) to 356(1)(d) would replicate paragraphs 810(1)(a) to
810(1)(d) of the Act.
446. Proposed paragraph 356(1)(e) would largely replicate paragraph 810(1)(e) of the Act but
remove the existing requirement that the fee must be paid to an industrial association.
447. Consequently, the prohibition would apply to any bargaining services fee. Proposed
subsection 356(2) would provide that any terms used in section 356 will have the same meaning
as they have when used in section 810. Therefore, the definition of `bargaining services' and
`bargaining services fee' in section 779 would apply in relation to proposed paragraph 356(1)(e).
448. This means that the prohibition on bargaining services fees would apply to fees paid to
someone else in lieu of an industrial association and in circumstances where the fee is to be paid
for services provided on behalf of an industrial association. This would ensure that industrial
associations cannot rely on related third parties to try and avoid the prohibition on bargaining
services fees.
Senate page 66 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 4 - Prohibited content
449. Item 1 would make a consequential amendment to subsection 4(2). Subsection 4(2)
currently refers to regulations made under section 356. This reference would be amended to
refer to regulations made under paragraph 356(1)(f).
Item 3 - Transitional - regulations made for the purposes of section 356 of the Workplace
Relations Act 1996
450. As item 2 would repeal and replace existing section 356, this item saves the existing
regulations by providing that regulations previously made under the repealed section 356 have
effect as if they were made for the purposes of proposed paragraph 356(1)(f).
451. This item does not apply to subregulation 8.5(7) of the Regulations as this is the
subregulation which is now effectively replicated in proposed paragraphs 356(1)(a) to 356(1)(e).
Senate page 67 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 5 - Membership requirements for registered organisations
Schedule 5 - Membership requirements for registered organisations
Workplace Relations Act 1996
Item 1 -Section 6 of Schedule 1
Item 2 - Section 6 of Schedule 1
Item 3 - Section 6 of Schedule 1 (definition of federal system employee)
Item 4 - Section 6 of Schedule 1 (definition of federal system employer)
Item 5 -Section 6 of Schedule 1
Item 6 -Section 6 of Schedule 1
Item 7 -Section 6 of Schedule 1
Item 8 -Section 6 of Schedule 1
1. Items 1 to 8 would make a number of amendments as part of aligning the definitions of
federal system employee and federal system employer with the definition of employee and
employer in sections 5 and 6 of the Act.
2. Item 3 would repeal and replace the existing definition of federal system employee in section
6 of Schedule 1 to the Act. Paragraph (a) of the new definition of federal system employee
would replicate the definition of 'employee' under section 5 of the Act.
3. Paragraph (b) of the new definition would also apply to a person employed in Victoria, to the
extent that the provisions of Schedule 1 that would apply fall within the legislative power
referred to the Commonwealth under the Commonwealth Powers (Industrial Relations) Act 1996
of Victoria. It would also include an independent contractor who if he or she was an employee
performing the same sort of work would be a federal system employee. This is consistent with
the definition of federal system employee in existing paragraphs 18B(2)(d) and 18B(2)(e) of
Schedule 1, which is being repealed.
4. Item 4 would repeal and replace the existing definition of federal system employer. The new
definition of federal system employer would replicate the definition of employer in paragraphs
6(1)(a)-(f) of the Act. It would also apply to an employer in Victoria, to the extent that the
provisions of Schedule 1 that would apply fall within the legislative power referred to the
Commonwealth under the Commonwealth Powers (Industrial Relations) Act 1996 of Victoria.
This is consistent with the definition of federal system employer in existing paragraphs
18A(2)(d) and 18A(b)(d) which are being repealed.
5. Items 1, 2, 5, 6, 7 and 8 would insert definitions of various terms used in the new definitions
of federal system employee and federal system employer. With the exception of Item 2, each of
these terms is defined as having the same meaning as in the Act. Item 2 inserts a new definition
of designated Commonwealth authority. This definition is the same as the definition of
Commonwealth authority in section 4 of the Act. However, as Schedule 1 already has a slightly
different definition of Commonwealth authority, it was necessary to refer to a designated
Commonwealth authority for the purposes of the membership provisions.
Senate page 68 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 5 - Membership requirements for registered organisations
Item 9 - Paragraph 18A(1)(b) of Schedule 1
6. Currently Schedule 1 to the Act provides that an association of employers is federally
registrable if the majority of its members are federal system employers (the majority
membership requirement).
7. Item 9 would remove the majority membership requirement from paragraph 18A(1)(b) and
instead provide that an association of employers is federally registrable if some or all of its
members are federal system employers.
Item 10 - Subsection 18A(2) of Schedule 1
8. Subsection 18A(2) of Schedule 1 to the Act currently provides a definition of a federal
system employer.
9. Item 10 would repeal the definition of a federal system employer in subsection 18A(2).
Federal system employer would instead be defined in section 6 of Schedule 1 to the Act.
Item 11 - Paragraph 18A(4)(b) of Schedule 1
10. Paragraph 18A(4)(b) of Schedule 1 to the Act currently provides that an association of
employers is not federally registrable if it is only a body corporate by virtue of being registered
under the Schedule and a majority of its members are not federal system employers.
11. In line with the removal of the majority membership requirement, Item 11 would repeal
existing paragraph 18(4)(b) and provide that an association of federal system employers is not
federally registrable if it is only a body corporate by virtue of being registered under the
Schedule and it is not the case that some or all the association's members are federal system
employers.
Item 12 - Paragraph 18B(1)(b) of Schedule 1
12. Paragraph 18B(1)(b) of Schedule 1 to the Act currently provides that an association of
employees is federally registrable if the majority of its members are federal system employees.
13. Item 12 would remove the majority membership requirement from paragraph 18B(1)(b) and
instead provide that an association of employees is federally registrable if some or all its
members are federal system employees.
Item 13 - Subsection 18B(2) of Schedule 1
14. Subsection 18B(2) of Schedule 1 to the Act currently provides a definition of a federal
system employee.
15. Item 13 would repeal the definition of federal system employee in subsection 18B(2).
Federal system employee would instead be defined in section 6 of Schedule 1 to the Act.
Item 14 - Paragraph 18B(5)(b) of Schedule 1
16. Paragraph 18B(5)(b) of Schedule 1 to the Act currently provides that an association of
employees is not federally registrable if it is only a body corporate by virtue of being registered
under the Schedule and a majority of its members are not federal system employees.
17. In line with the removal of the majority membership requirement, Item 14 would repeal
existing paragraph 18B(5)(b) and provide that an association of federal system employees is not
federally registrable if it is only a body corporate by virtue of being registered under the
Schedule and it is not the case that some or all the association's members are federal system
employees.
Senate page 69 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
Schedule 5 - Membership requirements for registered organisations
Item 15 - Paragraph 18C(2)(b) of Schedule 1
18. Paragraph 18C(2)(b) of Schedule 1 to the Act currently provides that an enterprise
association is not federally registrable if the majority of its members are not federal system
employers.
19. Item 15 would remove the majority membership requirement from paragraph 18C(2)(b). It
would provide that an enterprise association is federally registrable if some or all its members
are federal system employees.
Item 16 - Subparagraph 18C(3)(c)(i) of Schedule 1
20. Subparagraph 18C(3)(c)(i) of Schedule 1 to the Act currently provides that an enterprise
association is not federally registrable if an employee performing work in the relevant enterprise
cannot be characterised as a federal system employee as set out in existing paragraphs 18B(2)(a)
to (d).
21. In line with the changes to the definition of federal system employee, Item 16 would repeal
subparagraph 18C(3)(c)(i) and refer to the new definition of federal system employee in section 6
of Schedule 1.
Item 17 - Subsection 18D(1) of Schedule 1
Item 18 - Subsection 18D(3) of Schedule 1
22. Section 18D of Schedule 1 contains provisions dealing with constitutional validity.
Subsections 18D(1) and 18D(3) of Schedule 1 to the Act currently provide that if Parliament had
insufficient legislative power to provide for the registration of an association in relation to a
particular class of federal system employers or employees, when working out whether the
majority of its members were federal system employers or employees, the definition of the term
would continue to apply as if it did not contain a reference to that particular class of persons.
23. As a consequence of the removal of the majority membership requirement, Items 17 and 18
amend subsections 18D(1) and 18D(3) to refer to the new definitions of federal system employee
and federal system employer that will be inserted in section 6 by these amendments.
Senate page 70 Workplace Relations Amendment
(A Stronger Safety Net) Bill 2007
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