The Emerging Industrial Relations Landscape

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The Emerging IndustrialRelations Landscape

• Charles Power Melbourne

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Overview of Work Choices

• a national system
• the demise of awards
• as a safety net
• as a benchmark for making workplace agreements
• Australian Fair Pay and Conditions Standard
  (AFPCS) will do these things for employers
• easier to make workplace agreements
• diminution of unfair dismissal laws
• harder for unions to represent members
• collective bargaining
• industrial action
• dispute resolution
• right of entry

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This morning we will examine

• impact on existing employment conditions
• making new employment conditions
• terminating employment

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Impact on existing conditions

• Federal award employees
• Federal agreement employees
• AWA employees
• Award and agreement free employees

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Federal award employees

• awards will continue but some provisions will
  cease to have effect
• provision for redundancy pay for employers with
  less than 15 employees
• AFPCS will prescribe certain conditions currently
  prescribed by awards

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Federal award employees (cont.)

• What is the AFPCS?
• AFPCS prescribes minimum entitlements for
• annual leave
• personal/carers leave
• parental leave
• minimum wage
• maximum ordinary hours of work

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Federal award employees (cont.)

• during 2006 awards will be rationalised and
  simplified in order to
• achieve award coverage on the basis of industry
  sector or work performed by employees
• remove non allowable matters
• identify preserved award terms and the employers
  and employees bound by those terms

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Federal agreement employees

• Pre-reform certified agreements will continue in
  operation
• AFPCS will not apply to these agreements
• pre-reform certified agreements can only be
  terminated under pre-reform Act provisions (ie by
  consent of parties, or unilaterally by one party
  if agreement has expired and AIRC is satisfied
  that termination is not contrary to public
  interest)
• however AWAs made under amended legislation will
  extinguish pre-reform certified agreement insofar
  as it applies to employee party to AWA
• prohibited content provisions will not apply
  (with exception of the no-AWA clauses)
• transmission of business provisions under
  pre-reform Act will apply

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AWA employees

• pre-reform AWAs continue to operate after amended
  legislation commences
• pre-reform AWA will cease operation if terminated
  under pre-reform Act provisions or replaced by
  AWA made under amended legislation
• collective agreements and award will have no
  effect in relation to an employee while a
  pre-reform AWA operates in relation to that
  employee (even if expired)

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Award and agreement free employees

• AFPCS will provide for minimum conditions for
  award and agreement free employees
• state legislation dealing with LSL, jury service
  or super continue to operate, but preserved award
  terms prevail to the extent of inconsistency
• AFPCS prevails over employment contract to the
  extent that AFPCS provides a more favourable
  outcome for an employee

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Award and agreement free employees (cont.)

• AFPCS will prescribe minimum wages for particular
  employee groups by way of Australian Pay and
  Classification Scales (APCSs). APCS will
  comprise
• base hourly rate (excluding bonuses, loadings,
  allowances and penalties)
• casual loading
• classifications
• coverage rule

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Award and agreement free employees (cont.)

• AIRC will simplify APCS classifications and pay
  rates and reduce overlap in classification
  structures
• base hourly rate and casual loading will be
• pre-reform award rate and/or loading
• 12.75 and/or 20 loading for casuals (Federal
  Minimum Wage) if no award applies
• Australian Fair Pay Commission will determine and
  adjust APCSs

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Award and agreement free employees (cont.)

• Some observations about AFPCS conditions
• maximum ordinary hours of work average of 38
  hours over 12 months (or period of employment,
  whichever is lesser) plus reasonable additional
  hours
• reasonable additional hours determined having
  regard to such factors as OHS risk, employees
  personal circumstances, employers operational
  requirements, notice employer gives of
  requirement and notice employee gives of refusal
  (not employee remuneration)
• employees and employer can make written agreement
  about shorter averaging period

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Award and agreement free employees (cont.)

• annual leave
• employer may direct an employee who has
  accumulated more than 8 weeks leave to take up to
  ¼ of that leave
• workplace agreements may provide for up to 2
  weeks accrued annual leave to be cashed out
• personal leave
• 10 days per annum entitlement (compared with 8
  days under Schedule 1A)
• employee (including a casual) is entitled to up
  to 2 days unpaid carers leave on each occasion
  when an immediate family or household member
  requires care or support

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Making new employment conditions

• award
• collective agreements
• Australian workplace agreements
• employment contract (common law)

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Award

• An award-free employer (or employer employing
  award-free employees) can apply to AIRC to be
  roped into an appropriate award to bind it and
  certain of its employees
• AIRC will grant application if valid majority of
  the employees agree
• if employees do not agree, AIRC may still grant
  application if employer unable to make a
  workplace agreement with employees despite
  reasonable efforts
• Employees and unions (on behalf of employees) can
  make applications to rope-in employers

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Collective agreements

• Types of collective agreements under new
  legislation
• employee collective agreements
• union collective agreements
• union greenfields agreements
• employer greenfields agreements

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Employee collective agreements

• Steps to make an employee collective agreement
• give employees to be subject to agreement ready
  access to agreement for 7 day period (employees
  may sign and date a written waiver of this
  requirement)
• give employees information statement in
  prescribed terms
• meet and confer with a bargaining agent about the
  agreement if requested to do so (employees may
  appoint persons, including a union, to be their
  bargaining agent)

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Employee collective agreements (cont.)

• employees decide whether they want to approve
  agreement (usually by vote)
• employer lodges agreement with Employment
  Advocate within 14 days of approval
• employer gives employees copy of receipt issued
  by Employment Advocate within 21 days

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Employee collective agreements (cont.)

• steps 1 and 2 must be undertaken for new
  employees who will be covered by agreement and
  who join during 7 day period
• agreement takes effect on lodgement even if steps
  not complied with (although non-compliance may
  render employer liable for commission of
  offences under Act)
• there is no scrutiny by the Employment Advocate

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Union collective agreements

• Same steps to make a union collective agreement
  except that
• agreement is first made between employer and one
  or more unions
• once agreement is made with union(s) employer
  must take reasonable steps to seek approval from
  employees for agreement
• no rights for bargaining agents
• only employer can lodge union collective
  agreement with Employment Advocate

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Greenfield agreements

• an employer may make a collective greenfield
  agreement if establishing a new business, project
  of undertaking to cover future necessary
  employees
• collective greenfield agreement may be made with
  one or more unions with coverage over prospective
  employees (union greenfield agreement). If so,
  agreement must be lodged with Employment Advocate
  within 14 days of making

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Greenfield agreements (cont.)

• alternatively, employer may simply make and lodge
  the greenfield agreement with Employment
  Advocate (employer greenfield agreement)

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Australian workplace agreements (AWA)

• Same steps as making a collective agreement
  except that AWA is signed by employee (or
  parent/guardian if under 18 years)

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Workplace agreements

• Content limitations
• max term 5 years (1 year for greenfield
  agreements), but continue to operate thereafter
  unless terminated or replaced
• must contain dispute settlement procedures (if
  silent, model dispute resolution process will
  apply)

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Workplace agreements (cont.)

• no disadvantage test abolished. However,
  applicable award conditions about rest breaks,
  bonuses, incentive-based payments, annual leave
  loading, public holidays, monetary allowances,
  overtime or shift loadings, penalty rates or
  outworker conditions will be deemed to be
  included in the agreement unless expressly
  excluded or modified by the agreement

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Workplace agreements (cont.)

• regulations will prescribe prohibited content
• prohibited content is expected to include
  provisions prohibiting AWAs, restricting use of
  contractors/labour hire, granting trade union
  training leave or providing a remedy for unfair
  dismissal
• prohibited content will have no effect and it
  will be an offence to seek inclusion in the
  agreement of such terms
• Employment Advocate will have power to remove
  prohibited content from agreements

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Workplace agreements (cont.)

• effect of workplace agreements
• AFPCS prevails over workplace agreement to the
  extent that AFPCS provides a more favourable
  outcome for an employee
• once a workplace agreement commences operation in
  respect of an employee, any award applying to
  that employee is extinguished forever
• while an AWA operates in relation to an employee
  no collective agreement will have effect

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Workplace agreements (cont.)

• a workplace agreement may be varied or terminated
  by taking the same steps as with lodgement
• variation or termination takes effect on
  lodgement, despite non-compliance with steps (but
  offences may be committed if non-compliance)
• an expired workplace agreement may be terminated
  by a party unilaterally by giving the other
  parties 90 days written notice
• the notice must be in a prescribed form and
  lodged with the Employment Advocate

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Workplace agreements (cont.)

• termination takes effect upon lodgement
• Employment Advocate issues receipt on lodgement,
  which must be given to employees affected within
  21 days
• if the terminating party is an employer, it may
  make undertakings as to terms and conditions of
  employees bound by the agreement to operate after
  termination unless or until next workplace
  agreement operates

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Employment Contract (common law)

• Employers may choose to regulate employment by
  common law contract
• contractual terms cannot override AFPCS or any
  applicable award
• does amending legislation provide for exclusive
  code for enforceability of collective agreements?
  We think not.

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Unfair dismissal

• Where an employee is employed by a company, the
  employee will not be able to bring an unfair
  dismissal claim where
• the employer employs 100 or less employees
• the dismissal arises out of a redundancy
• the dismissal occurred within the 6 month
  qualifying period or
• the employee falls within one of the existing
  exclusions, for example, a fixed term contract.

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Unfair dismissal the 100 Cap

• no application can be made alleging the dismissal
  was unfair if the employer employed 100 or
  fewer employees. This includes
• all forms of permanent employees and
• certain casuals.
• the test must be met at the time notice is given
  or the employment is terminated, whichever
  occurs first.
• there are no grouping provisions

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Unfair dismissal - redundancy

• no unfair dismissal claim can be brought where
  the employees employment was terminated for
  genuine operational reasons or for reasons that
  include genuine operational reasons.
• operational reasons are reasons of an economic,
  technological, structural or similar nature
  relating to the employers undertaking,
  establishment, service or business or part of
  it.

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Unfair dismissal - redundancy

• there will be no entitlement to redundancy
  compensation for non-award/non-industrial
  agreement employees, unless provided for in a
  contract of employment or policy.
• whether the termination was for genuine
  operational reasons will be determined as a
  preliminary matter before any claim progresses.

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Unfair dismissal qualifying period

• the requirement to have completed a qualifying
  period under section 170CE(5A) remains
• now extended to 6 months under section 170CE(5B).