Bills Digest No. 14   1997-98 Workplace Relations and Other Legislation Amendment Bill 1997


Numerical Index | Alphabetical Index

WARNING:
This Digest was prepared for debate. It reflects the legislation as introduced and does not canvass subsequent amendments. This Digest does not have any official legal status. Other sources should be consulted to determine the subsequent official status of the Bill.

CONTENTS

Passage History

Workplace Relations and Other Legislation Amendment Bill 1997

Date Introduced: 26 June 1997
House: House of Representatives
Portfolio: Workplace Relations and Small Business
Commencement:

  • Most of this Bill commences on the day it receives Royal Assent; whilst
  • Schedule 8, dealing with industrial matters referred to the Commonwealth by Victoria, commences on a day to be fixed by Proclamation, or if no date is fixed, six months after the Bill receives Royal Assent.

Purpose

To amend provisions of the Workplace Relations Act 1996 relating to:

  • certified agreements;
  • Australian Workplace Agreements and the Employment Advocate;
  • the no-disadvantage test;
  • termination of employment;
  • freedom of association and preference clauses;
  • union disamalgamation; and
  • matters referred to the Commonwealth by Victoria.

The Bill also makes minor amendments to five other Acts including:

  • the Navigation Act 1912;
  • the Safety, Rehabilitation and Compensation Act 1988;
  • the Seafarers Rehabilitation and Compensation Act 1992;
  • the Superannuation Act 1976; and
  • the Superannuation Act 1990.

Background

This Bill has some substantive amendments perhaps nudging the law in favour of employers, but most of the clauses are of the house-keeping variety, clarifying and tidying up the Workplace Relations Act 1996.

The Workplace Relations Act 1996 was previously known as the Industrial Relations Act 1988, until it was overhauled and renamed late last year by two amending pieces of legislation:

  • the Workplace Relations and Other Legislation Amendment Bill 1996, which came into effect in stages from 31 December 1996; and
  • the Workplace Relations and Other Legislation Amendment Bill (No.2) 1996. which also came into effect in stages from late last year.

The first of these Bills, the Workplace Relations and Other Legislation Amendment Bill 1996, started out life as the Coalition Government's attempt to implement a long-standing commitment to deregulate Australia's industrial relations system. However, the Coalition's ambitious plans were watered down in the Senate, and the changes passed have been seen by some as less radical than initially promised. The Act in its current form is best seen as the linear descendant of the deregulatory changes undertaken by the previous Hawke-Keating Labor governments.

The Workplace Relations and Other Legislation Amendment Bill (No.2) 1996 primarily gave effect to the 11 November 1996 announcement by the Victorian and Commonwealth Governments of the partial referral of Victoria's industrial relations powers to the Commonwealth. These referred powers have been used by the Commonwealth to overcome constitutional limitations and to effectively take-over much of Victoria's industrial relations system.

In general terms, the 1996 Acts:

  • emphasised employers and employees reaching their own agreements at the enterprise level, and introduced Australian Workplace Agreements (AWAs) as a new vehicle for them to use;
  • further reduced the role of the Australian Industrial Relations Commission (AIRC), setting out a list of 20 key issues which the Commission could rule on;
  • established a new statutory body, the Office of the Employment Advocate, who's primary role is to vet the new AWAs and ensure employees are no worse off under them than they would be under the relevant award;
  • decreased the role of unions in the industrial relations system;
  • returned provisions relating to secondary boycotts to the Trade Practices Act 1974;
  • overhauled the unfair dismissal laws;
  • outlawed preferences clauses for unionists;
  • and incorporated the Victorian system into the Federal system after the Victorian Government referred most of its powers over industrial relations to the Commonwealth.

Main Provisions

Awards and Arbitration

Item 3 in Schedule 1 inserts a new subsection 170N(2) to make it clear that the AIRC may vary an award during a bargaining period to make a safety-net adjustment based on a National Wage Case decision.

Certified Agreements

The next three items affect the rights of new employees at a workplace considering a certified agreement.

Item 1 of Schedule 2 repeals paragraph 170LJ(3)(a) and inserts new paragraphs 170LJ(3)(a) and 170LJ(3)(aa). Under the 1996 Act, employees contemplating an enterprise agreement with either a corporation or the Commonwealth must have 14 days to examine the document before having to vote on it.

The amendment effectively reduces that period for employees who begin work after the 14 days begins to run. It is aimed at ensuring that the 14-day time period does not have to start running again if a new employee begins work during that time.

Item 2 repeals subsection 170LK(2) and inserts a new one, similarly aimed at ensuring that while existing employees must receive 14 days written notice of their employer's intention to make an enterprise agreement, the time period does not start running again every time a new employee starts work.

Item 3 repeals paragraph 170LR(2)(a) and inserts new paragraphs 170LR(2)(a) and 170LR(2)(aa). Section 170LR deals specifically with enterprise agreements made to settle industrial disputes. Again, it aims to ensure that while existing employees get 14 days to consider a proposed agreement, the time limit does not begin to run again if a new employee starts work.

Australian Workplace Agreements and the Employment Advocate

Items 1 to 5 in Schedule 3 clarify, and in some cases, extend, the powers of officers of the Employment Advocate.

Item 1 inserts a new paragraph 83BH(3)(c). This permits a person authorised by the Employment Advocate to enter a workplace if s/he has reasonable cause to believe that a breach of the Act is/has/or is likely to occur there in relation to either Australian Workplace Agreements or freedom-of-association provisions.(1)

An authorised officer already has this right of entry for another purpose - to check whether the Act is being complied with (section 83BH(1)). But there is no authority under the Act at present to enter to investigate an alleged breach. The Explanatory Memorandum says the new subsection 'corrects an oversight in the original drafting of subsection 83BH(3)(c)'.(2)

Item 2 repeals and replaces paragraph 83BH(4)(c). The existing subsection allows an authorised officer to interview 'any employee' at their workplace in relation to possible breaches of provisions of the Act relating to Workplace Agreements or freedom of association. The new subsection is significantly wider than the existing one. It allows the authorised officer to interview 'any person' at the workplace in relation to the suspected breaches. This would include, for example, an employer.

Item 3 repeals paragraph 83BH(4)(e). This subsection gives an authorised officer the power to inspect and copy a document produced to her/him at a workplace under investigation. However, the next amendment in item 4 does the same job, so paragraph 83BH(4)(e) is no longer required.

Item 4 amends subsection 83BH(6) to correct what clearly appears to have been an oversight. The amended subsection allows an authorised officer to inspect, copy and retain a document produced at a workplace for as long as necessary. The existing subsection only allows this if access to the document had first been refused, and the authorised officer forced to serve a notice-to-produce to obtain it.

Item 5 inserts new subsections 83BH(7A), 83BH(7B) and 83BH(7C). These new subsections give an authorised officer the power to enter a person's workplace, without using force, and interview them there if the officer believes the person has information about whether an Australian Workplace Agreement or freedom-of-association provisions are being complied with.

In one sense, these new provisions are narrower than other parts of the Act because they do not allow the officer to inspect the premises, copy documents, or interview other people there.

However, they are a significant new weapon in the Employment Advocate's arsenal because, for the first time, an authorised officer is allowed to enter a workplace where breaches are not suspected, in search of evidence in relation to a place where breaches are suspected.

The new sections may allow an authorised officer to enter union premises to interview union officials about possible breaches of freedom association provisions.

Item 8 repeals and replaces subsection 170VN(2). This provision deals with the filing requirements for Australian Workplace Agreements. Existing filing requirements are strict, and if not met, the documents must be rejected. Under the proposed amendment, the Employment Advocate must accept the documents if s/he is satisfied that a party to the agreement will not be disadvantaged by any minor irregularities.

Item 14 adds a new subsection 170WHA(2). Under section 170WHA only the parties to an Australian Workplace Agreement (or a bargaining agent of one of the parties), may make submissions to the Employment Advocate in relation to the agreement. However, the new subsection 170WHA(2) allows a person authorised in writing by a party to the agreement to explain the party's understanding of 'the affect of the AWA or ancillary document' to the Employment Advocate. There are a couple of additional limitations: they may only appear if the Employment Advocate considers it appropriate; and they are expressly prohibited from making submissions or from being heard for any other purpose than to explain the party's understanding of the affect of the agreement.

The no-disadvantage test

Under the Act, before the AIRC decides whether to approve a Certified Agreement, it must first assess whether employees would be worse off under the proposed agreement, rather than the relevant award. If its not clear which award is the relevant one, an employer must apply to the Commission and ask it to determine the appropriate Federal one.

Item 4 of Schedule 4 repeals subsection 170XF(2) and substitutes new subsections 170XF(2) and 170XF(3) enabling the Commission to designate a State award if there is no appropriate Federal one.

Item 2 makes a similar alteration to the powers of the Employment Advocate to approve Australian Workplace Agreements, by repealing subsection 170XE(2) and inserting new subsections 170XE(2) and 170EX(3).

Termination of Employment

Items 1, 6, 7, and 8 of Schedule 5 seek to clarify the relationship between State laws governing termination and Federal laws and awards.

Item 1 is the most important. It repeals and replaces subsection 152(1A) According to the Explanatory Memorandum, the existing provision was designed to ensure that employees could access State unfair dismissal provisions even though they were covered by a Federal award.(3) However, it also appears to have left the door open for employees wanting to take that further and use other State provisions on termination of employment, for example, in relation to severance pay or redundancy consultation.

The Explanatory Memorandum calls this an 'unintended consequence'.(4)

The new subsection removes the 'unintended consequence', by making it clear that employees covered by Federal awards or laws will only be able to use State laws dealing with 'harsh, unjust or unreasonable' termination of employment - and only in so far as they are able to operate concurrently with the award.

Items 2 and 3 impose new time limits on some sorts of applications to the AIRC in relation to employment termination.

Item 2 is the more important. It changes the effect of subsection 170CE(7) by imposing a 21-day time limit on a union applying to the AIRC on behalf of an employee over an employer's decision to sack. At the moment, their is no time limit on a union in this situation. This change puts a union into the same position as an individual - who must apply to the AIRC within 21 days of being notified of a decision to sack. However, in practice, it may be harder for a union to meet the time limit, for example, because it must first be notified of the situation by a union member.

Item 5 deals with the maximum amount of money the AIRC may award to an award employee who has been unfairly dismissed. Existing paragraph 170CH(8)(a) provides for a pay-out of no more than the employee received in the six months prior to the termination. However, that does not cater for the situation where the employee was paid LESS than their entitlement. The new subsection does.

New paragraph 170CH(8)(a) provides for a maximum pay-out equal to either: what the employee was paid in the previous six months; or what the employee was entitled to have been paid - whichever was the higher.

Freedom of association

Schedule 6 of the Bill inserts new provisions dealing with preference clauses. They ensure that an agreement may not be certified if it has a preference clause in it contrary to the freedom-of-association provisions contained in Part XA of the Act. If it is certified, then an appeal against that decision will lie to the Full Bench of the AIRC. These amendments also provide a mechanism for removing void preference clauses from existing agreements and awards.

Item 1 inserts new paragraphs 45(1)(eaa) and 45(1)(eba). These provide for appeal rights to the Full Bench of the Commission against a decision to approve an agreement containing a preference clause, or a refusal to remove a preference clause from an existing agreement or award. (Subsection 45(1)(eba) is linked to item 6 below).

Item 2 inserts new paragraphs 45(3)(ba), 45(3)(baa) or 45(3)(bab). These specify who may bring an appeal, and include the Employment Advocate.

Item 3 inserts a new subsection 170LU(2) requiring the Commission to refuse to approve an agreement, if the Commission is satisfied it contains a preference clause or permits or requires conduct contrary to the freedom-of-association provisions in the Act.

Item 5 inserts a new paragraph 170MD(7)(e). This provides that a certified agreement may be varied during its life to remove a preference clause. (Certified agreements may only be varied for specified reasons as set out in the Act.)

Item 6 inserts a new section 298Z. This requires the Commission to remove preference clauses from existing awards and agreements on application by specified people or groups.

Registered Organisations

The four items in Schedule 7 contain technical amendments relating to union disamalgamations. According to the Bill's Explanatory Memorandum, Schedule 7 'corrects an unintended limitation on the circumstances in which a constituent unit of a registered organisation can apply to withdraw from an amalgamation and clarifies how such applications can be made...'.(5)

Matters referred by Victoria

On 11 November 1996, the Victorian and Commonwealth Governments announced that Victoria would be handing specific powers over industrial relations to the Commonwealth. This agreement was given legislative effect by, on the part of Victoria, the Commonwealth Powers (Industrial Relations) Act 1996 (Vic), and, on the part of the Commonwealth - the Workplace Relations and other Legislation Amendment Bill (No.2) 1996. These referred powers have been used by the Commonwealth to overcome constitutional limitations and to effectively take over Victoria's industrial relations system.

The items in Schedule 8 use the expanded powers in two principle ways: to bind more successor employers to Certified Agreements or Australian Workplace Agreements (many are bound already by other provisions in the Act); and to confirm the Commonwealth's expanded powers in Victoria in relation to Australian Workplace Agreements.

Miscellaneous Amendments

Item 1 of Schedule 9 amends paragraph 152(5)(a) of the Act. This section is one of a number dealing with the relationship between State awards and laws, and Federal ones. As a general rule, a Federal law or award will take precedence over a State one. However, there are some exceptions. This section provides one. It says that a Federal award will not take precedence over a state enterprise agreement either in existence, or to come into existence, providing a number of conditions have been met. These conditions include that the agreement must have been approved under State law, by a State body, which examined the agreement to ensure it passed a 'no-disadvantage test' (that is, that the employees would be no worse off under the agreement than under the relevant award). Item 1 amends the section to specify that the relevant award which the agreement must be compared with, is a State award, not a Federal one.

The rest of the items in this schedule either remove redundant provisions, or update their terminology.

Amendments to other Acts

Schedule 10 makes minor technical amendments to the followings Acts:

the Navigation Act 1912;

the Safety, Rehabilitation and Compensation Act 1988;

the Seafarers Rehabilitation and Compensation Act 1992;

the Superannuation Act 1976; and

the Superannuation Act 1990.

Concluding Comments

In his second reading speech, the Minister for Workplace Relations and Small Business, the Honourable Peter Reith, indicated the Bill had the support of the peak employer group, the Australian Chamber of Commerce and Industry, and was not opposed, for the most part, by the Australian Council of Trade Unions (ACTU).(6)

Apparently, the ACTU opposes:

  • allowing for the removal of preference clauses breaching the freedom-of-association provisions;
  • reducing the 14-day waiting period for new employees starting work at a workplace already considering an enterprise agreement - the ACTU would rather the AIRC be given the ability to waive the time-limit if it believes it would unreasonably prolong approval and was not being used as a device to avoid the approval process;
  • giving increased powers to officers of the Employment Advocate;
  • allowing a person who is not a party to an AWA to appear before the Employment Advocate to make submissions about the party's understanding of the effect of the agreement - the ACTU is concerned that lawyers will be the ones most likely to take advantage of this; and
  • removing residual State unlawful termination entitlements.

Endnotes

  1. The freedom-of-association provisions are contained in Part XA of the Act. They provide, amongst other things, that an employee may not be discriminated against on the basis of whether s/he is or is not a member of a union. This effectively outlaws union preference clauses.
  2. Explanatory Memorandum to the Workplace Relations and Other Legislation Amendment Bill 1997 , p8.
  3. ibid, p16
  4. ibid, p16
  5. ibid, p2.
  6. Second Reading Speech to the Workplace Relations and Other Legislation Amendment Bill 1997 , p3.

Contact Officer and Copyright Details

Bronwyn Young
25 August 1997
Bills Digest Service
Information and Research Services

This Digest does not have any official legal status. Other sources should be consulted to determine whether the Bill has been enacted and, if so, whether the subsequent Act reflects further amendments.

IRS staff are available to discuss the paper's contents with Senators and Members and their staff but not with members of the public.

ISSN 1328-8091
Commonwealth of Australia 1997

Except to the extent of the uses permitted under the Copyright Act 1968, no part of this publication may be reproduced or transmitted in any form or by any means, including information storage and retrieval systems, without the prior written consent of the Parliamentary Library, other than by Members of the Australian Parliament in the course of their official duties.

Published by the Department of the Parliamentary Library, 1997.

This page was prepared by the Parliamentary Library, Commonwealth of Australia
Last updated: 26 August 1997



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