Coalition policy before the 2013 election
The committee heard evidence from the Minister and Department that the
Coalition's registered organisations policy was released far in advance of the
2013 election, and should not have come as a surprise to officers, employees
and volunteers of registered organisations.
The Minister for Employment, Senator the Hon Eric Abetz, submitted that the
Coalition had released its Policy for Greater Accountability and Transparency
of Registered Organisations on 30 April 2012, noting that, 'This policy has
been well ventilated for some time and the Government has a very clear mandate
to implement it as a matter of extreme urgency.'
The Minister contended that the purpose behind the legislation was
straightforward, and that while the Government supports the role unions play,
it believes that accountability and transparency of registered organisations
will be enhanced by the measures in the bill.
Legislation Committee inquiry and recommendations
The Senate Education and Employment Legislation Committee made numerous
recommendations with respect to the bill, as introduced in the House of
Representatives on 14 November 2013. The committee specifically recommended
Consistent with the Corporations Act 2001, material
personal interest disclosures should only be required to be made to those
officers whose duties relate to the financial management of the organisation.
Such disclosures should be recorded in the minutes of the meetings of those
officers and should be made available to members on request;
A list of exclusions from the obligations to disclose material
personal interests based on section 191(2) of the Corporations Act 2001
be inserted into the bill. This would narrow the obligation to disclose
material personal interests of an officer's relatives, so as to be consistent
with the Corporations Act 2001;
The obligation placed on officers to disclose every payment
should be reduced with certain exclusions, including limiting disclosures to
payments made above a certain threshold;
The bill be amended to allow the Commissioner to grant exemption
from the training requirements if an individual can demonstrate significant
knowledge of the financial obligations specified in the bill; and
That the bill be passed subject to foregoing recommendations.
Responses to the bill
The committee heard evidence from submitters and witnesses in relation
to the recommendations of the Education and Employment Legislation Committee's
(Legislation Committee) report. Some submitters argued that the recommendations
did not go far enough to address their concerns. The committee notes that
numerous submitters have reused, in whole or in part, the submissions they made
to the previous inquiry.
Recommendations one, two and three seek to ensure that only officers
whose duties relate to the financial management of the registered organisation
are subject to the material personal interest disclosure requirements. The
Legislation Committee recommended the addition of exemption arrangements as per
section 191(2) of the Corporations Act 2001 (Cth) (the Corporations Act)
and the exclusion of some payments from disclosure requirements completely.
Recommendation four seeks to address criticisms relating to compulsory
training for officers with significant experience in financial management. The
recommendation would provide the Commissioner with the power to exempt officers
with extensive training or experience in financial management from the training
requirements proposed in the bill.
The Minister for Employment, Senator the Hon Eric Abetz, in his
submission together with the earlier submission from the Department, notes that
while the bill was drafted in such a way as to build on the existing regulatory
The Government is giving active consideration to the issues
that have been raised by the Senate Education and Employment Legislation
Committee and stakeholders.
Master Builders Australia (MBA) endorsed the recommendations made by the
Legislation Committee in the report tabled on 2 December 2013,
expressing its support for any initiatives that deliver improved governance and
financial transparency with respect to the conduct and management of registered
MBA restated its view that the interests of those involved in the building and
construction sector are advanced where the industrial relations legislation
requires transparency and accountability of registered organisations, without
adding unnecessary burdens or costs.
The National Electrical and Communication Association (NECA) submitted
that it also endorsed the recommendations of the Legislation Committee,
specifically the establishment of the Commissioner:
For the avoidance of doubt, it should be stated that NECA has
no objection to the establishment of the Registered Organisations Commissioner,
and the conferral of such powers on that office as proposed by the Bill.
Australian Industry Group (Ai Group) suggested that the Education and
Employment References Committee should endorse the Legislation Committee's
recommendations, but also suggested that the recommendations do not go far
enough to address their other concerns with the bill.
Mr Stephen Smith, Director, Ai Group, stated at the public hearing in Sydney
that, 'we are here today very much urging this committee to adopt those four
The Master Plumbers & Mechanical Contractors Association of NSW (MPMCANSW)
submitted that it needed additional clarification before it could support the
recommendations made in the Legislation Committee's report. It suggested that
the previous inquiry needed to emphasise the structural and other differences
between employer and employee organisations, operating as registered
organisations; referring to its submissions to the previous inquiry, the
organisation was concerned about:
...equal representative rights afforded to Recognised Organisations,
when they are not the subject of the provisions of the amendments to the Act.
The recommendations of the Legislation Committee Report embrace the implementation
of requirements to bring operational and reporting requirements of Registered
Organisations in line with the Corporations Act 2001, but the situation
still remains that there are two distinctly different organisational structures
for organisations who have representation rights before the Fair Work
The committee is persuaded by evidence from submitters that the
recommendations made by the Legislation Committee are inadequate in addressing
the concerns of submitters in relation to the proposed changes to the Fair
Work (Registered Organisations) Act 2009. The committee believes that even
if the recommendations were accepted by the Government, the bill would still
cause great disruption and harm to the operations and effectiveness of the
administration of registered organisations in Australia. This is due to the
significant unintended consequences of the bill and the training and financial
burdens proposed by the bill.
General criticism of the Bill
The Maritime Union of Australia (MUA) criticised the proposed regulatory
framework in its submission, stating that:
The principle submission of the MUA is that the changes to
the regulatory regime effected by the Fair Work (Registered Organisations)
Amendment Act 2012 (Cth), as amended by the Fair Work Amendment Act 2013
(Cth), are sufficient to strengthen legislative provisions and Rules of
organisations concerning disclosure and transparency of decision making.
The MUA noted the Government's intention to cut $1 billion in red and
green tape each year in a statement made on 13 January 2014 by the Hon
Christopher Pyne MP and the Hon Josh Frydenberg MP.The
MUA submitted that the provisions of the bill are in direct contravention of
the announced objective, and undermine the argument for a separate regulator.
NECA submitted that in its view the bill would establish a more onerous
regulatory regime than presently operates under the Corporations Act.
The MPMCANSW also objected to the increased regulation proposed in the
bill, submitting that:
...the issues set out above will add significantly to the red tape
requirements of Registered Organisations and will add significant cost
pressures to the organisation related to such compliance. The inequity here is
that this is not necessarily an impediment to the ability of employees of
Registered Organisations to carry out their duties, but more than ever highlights
the inequity in the status of Registered Organisations as compared to
The Motor Trade Association of South Australia (MTA) and NECA both
criticised the 'one size fits all' approach proposed by the bill.
NECA submitted that employees of registered organisations with specialist
knowledge are no longer commonly found or recruited and as a consequence
registered organisations have become reliant on external legal advisors and
When this factor is combined with the shift to further and
stricter regulation of registered organisations, the compliance costs to
registered organisations, the compliance costs to registered organisations have
increased markedly over the last few years...
The South Australian Wine Industry Association (SAWIA) submitted:
SAWIA acknowledges that review and reform of the law
governing registered organisations is both necessary and justified from time to
time to ensure good governance and accountability. However the unlawful conduct
of some officers within one registered organisation does not justify imposing
excessive compliance and disproportionate monetary penalties on all registered
organisations in a manner contemplated by some of the provisions in the Fair
Work (Registered Organisations) Amendment Bill 2013.
SAWIA stated that for its purposes, many of its board members were the
equivalent of 'officers' for the purposes of the bill, who volunteer their time
to attend to the duties required of having been elected to the board:
Board members provide a great amount of time each year of
office to attend to just the basic activities entailed in holding a board
position: reading, considering board papers and attending (travelling) regular
board meetings held across regional South Australia. This is not to mention the
additional work required like key meetings or activities with government bodies
or industry stakeholders, consultation.
The Australian Council of Trade Unions (ACTU) submitted that officers
and employees of registered organisations are principally concerned with work
representing that organisation's members, notwithstanding:
The greater emphasis on administrative process to ensure
compliance with the new regime may be expected to divert some resources away from
the core business of organisations and their branches. This would principally
occur during the transition phase (on top of the existing transition phase)
with peaks occurring during the ordinary reporting cycle (as filings become
Navigation: Previous Page | Contents | Next Page