The Committee has sought my advice as to whether there are 'less rights restrictive approaches' than those in paragraphs 13(2)(b), (c) and (j) of the 2016 Code to achieve the stated objective of protecting the ability of individuals to choose not to join a union.

In my responses to the Committee on 3 July 2017 and 5 October 2017 I outlined extensive material regarding the coercive culture that exists within the building and construction industry in which it is understood that there is such a thing as a 'union site' and on those sites all workers are expected to be members of a building association, whether voluntary or not. This included (but was not limited to) a number of findings by courts. Further decisions have been handed down since my last response of 5 October 2017 in which the Construction, Forestry, Mining and Energy Union (CFMEU) has repeatedly engaged in conduct that reinforces the coercive culture that an individual must be a union member:

• In October 2017 the Federal Court found the CFMEU in 2015 through its delegate, engaged in adverse action when that delegate prevented a subcontractor's employee from working on site because he was not a union member and prevented the same employee from performing work on site with intent to coerce him to become a union member. The CFMEU also engaged in coercion when the delegate insisted a second employee of the subcontractor pay fees to join the CFMEU. In imposing fines of $90,000 on the CFMEU and $8,000 on the delegate, Justice Tracey stated that ...the Commissioner has identified 15 cases, since 2000, in which the CFMEU and its officials have been found to have contravened the Act and its predecessors by engaging in misconduct with a view to maintaining "no ticket no start" regimes' ...and that the delegate 'arrogated to himself the right to determine who would and would not work on the site in order to advance the 'no ticket no start' regime ...'. Justice Tracey also observed that the CFMEU did not provide any assurance that 'it will direct its shop stewards not to seek to enforce "no ticket, no start" regimes and to respect the freedom of association provisions ....' (Australian Building and Construction Commissioner v Construction, Forestry, Mining and Energy Union (Werribee Shopping Centre Case) [2017] FCA 1235).
• In November 2017, the Federal Court found a CFMEU shop steward in 2014 knowingly made false representations when, upon learning two employees of a subcontractor were non-paying CFMEU members, told the first employee 'You need to fix it. I can't let you work if you're not paid up' and the second ' ...you can't work in here ...This job is a union site'. The court also found that in making the false representation and refusing the first employee to work on site a few days later, the shop steward engaged in coercion and adverse action against that employee. His Honour also found the CFMEU to be vicariously liable for the actions of the shop steward. The Court is yet to consider the matter of penalties against the shop steward and the CFMEU (Australian Building and Construction Commission v Construction, Forestry, Mining and Energy Union (The Quest Apartments Case) [2017] FCA 1398).

The Committee has asserted the provisions are an overbroad limitation on freedoms of expression and association in protecting an individual's right to choose not to join a union. The Committee must however consider the context in which these provisions were introduced and operate. As can be seen from the many decisions of the courts, the CFMEU had promoted, and continues to persistently promote, a coercive culture in which a person cannot engage in a day's work if they are not a union member.

As was set out in my previous responses alternative approaches to address and challenge the custom and practice ingrained in the industry such as education and better mentoring and enforcement have been employed by the Australian Building and Construction Commission and its predecessors. It would be preferable if such approaches on their own were capable of making a difference to the ingrained practice. However, as I concluded in my response of 5 October 2017, it is clear that these approaches alone have not been sufficient (and in my view will continue [to] not be sufficient in the immediate future) to bring about the culture change required to protect the right of individuals to choose whether or not to join a union.

It is in the context of a persistent coercive culture that has not responded to more traditional approaches to protecting freedom of association that the provisions in section 13 are necessary and proportionate. As I have stated in the previous responses, these provisions do not seek to eliminate all forms of expression in relation to union membership. Posters merely encouraging or conveying the benefits of union membership are not prohibited and an individual can display logos on their own personal clothing. The provisions are intended to eliminate visual cues that serve to reinforce the idea of 'union sites'; that is, signs that are directed at harassing or vilifying an individual on the basis of their participation or non-participation in industrial activities; 'no ticket, no start' signs; and union logos, mottos or indicia on employer clothing, property or equipment.

An individual can still seek to express their genuinely held views about industrial action without necessarily making an individual feel coerced into joining or not joining an association. As such it cannot in my view be asserted, as the Committee has done, that the 'limitation on freedom of expression is extensive'. With respect, the Committee's characterisation of the issue, that prohibiting 'insulting language or communication' for the purpose of achieving the stated objective still constitutes a limitation on the right to freedom of expression, trivialises a very real issue for those actually in the building and construction workforce.

The provisions are in my view absolutely essential in addressing the persuasive culture in the building and construction industry and achieving the objective of protecting the ability of individuals to choose to join or not to join a union.

2.99        The minister's third response provides a range of further information which addresses questions related to the proportionality of the limitation in context. The response points to a range of serious conduct being dealt with by the courts relating to the ability of persons to choose not to join a union. In this context, as acknowledged above, protecting the ability not to join a union would appear to be a legitimate objective for the purposes of international human rights law.

2.100         In relation to the proportionality of the measure, the minister reiterates information she previously provided about the extent and scope of the limitation including exceptions. The view outlined in the committee's previous report that the limitation on the right to freedom of association and the right to freedom of expression was potentially extensive and appeared to be insufficiently circumscribed was based on an assessment of the measures in light of the scope of these rights and international jurisprudence. Identifying and assessing these limitations is in accordance with the committee's mandate under the Human Rights (Parliamentary Scrutiny Act) 2011 and is different to an assessment of the broader policy merits of the measures. Relevantly, as noted above, international supervisory bodies have expressed concerns, from the perspective of the right to freedom of expression and the right to freedom of association, regarding measures which restrict the display of union posters or signs in the workplace.

2.101         Further, the minister's response does not clearly articulate how the proposed measure is the least rights restrictive approach to achieving this objective. While relevant, the fact there are court cases which are dealing with such conduct including imposing fines does not necessarily mean the measure in the code is the least rights restrictive. The minister's third response states that less rights restrictive approaches such as education and better monitoring or enforcement have been insufficient to address the stated objective. However, the minister does not fully explain the extent to which other less rights restrictive approaches have been considered or explain what these approaches were. Accordingly, the measure as formulated may not be the least rights restrictive approach.  

Committee response

2.102        The committee thanks the minister for her response and has concluded its examination of this issue.

2.103        The preceding analysis indicates that the measure may be incompatible with the right to freedom of association and the right to freedom of expression under international law.

Commonwealth Redress Scheme for Institutional Child Sexual Abuse Bill 2017; and

Commonwealth Redress Scheme for Institutional Child Sexual Abuse (Consequential Amendments) Bill 2017

Background

2.104        The committee first reported on the Commonwealth Redress Scheme for Institutional Child Sexual Abuse Bill 2017 (the bill) and the Commonwealth Redress Scheme for Institutional Child Sexual Abuse (Consequential Amendments) Bill 2017 in its Report 13 of 2017, and requested a response from the Minister for Social Services by 20 December 2017.[47]

2.105        The minister's response to the committee's inquiries was received on 20 December 2017. The response is discussed below and is reproduced in full at Appendix 3.

2.106        The minister explained, by way of background, that the bill is a 'first step to encourage jurisdictions to opt-in to the Scheme, and has been designed in anticipation of their participation should a referral of powers be received'. If the states agree to provide a referral of power to participate in the scheme from its commencement, the minister intends to replace the bill with a National Redress Scheme for Institutional Child Sexual Abuse Bill 2017 (the national bill).

Eligibility to receive redress under the Commonwealth Redress Scheme

2.107         The bill seeks to establish a redress scheme (the scheme) for survivors of institutional child sexual abuse.

2.108         A person is eligible for redress under the scheme if the person was sexually abused, that sexual abuse is within the scope of the scheme, and the person is an Australian citizen or permanent resident.^[48] Proposed subsections 16(2) and (3) of the bill provide that the proposed Commonwealth Redress Scheme Rules (the rules) may also prescribe that a person is eligible or not eligible for redress under the scheme.^[49]

Compatibility of the measure with the right to equality and non-discrimination

2.109         The right to equality and non-discrimination in the International Covenant on Civil and Political Rights (ICCPR) provides that everyone is entitled to enjoy their rights without discrimination of any kind, and that all people are equal before the law and entitled without discrimination to the equal and non-discriminatory protection of the law.[50] Article 2 of the Convention on the Rights of the Child (CRC) further provides that states parties to the CRC must respect and ensure the right to equality and non-discrimination specifically in relation to children.

2.110         'Discrimination' encompasses both measures that have a discriminatory intent (direct discrimination) and measures which have a discriminatory effect on the enjoyment of rights (indirect discrimination). The UN Human Rights Committee has explained indirect discrimination as 'a rule or measure that is neutral on its face or without intent to discriminate', which exclusively or disproportionately affects people with a particular personal attribute.[51]

2.111         As acknowledged in the statement of compatibility, by precluding persons who are not Australian citizens or permanent residents from being eligible for the scheme, the restrictions on eligibility discriminate on the basis of nationality or national origin.

2.112         Persons who are the victim of violations of human rights within Australia's jurisdiction are entitled to a remedy for breaches of those rights irrespective of their residency or citizenship status.[52] However, differential treatment will not constitute unlawful discrimination if the differential treatment is based on reasonable and objective criteria such that it serves a legitimate objective, is rationally connected to that legitimate objective and is a proportionate means of achieving that objective.

2.113         The statement of compatibility explains that the restrictions on eligibility of non-citizens and non-permanent residents are necessary to achieving legitimate aims of ensuring the scheme receives public support and protecting against large scale fraud. In relation to the latter, the minister explains:

Non-citizens and non-permanent residents...will be ineligible to ensure the integrity of the Scheme. Verification of identity documents for non-citizens and non-permanent residents would be very difficult. Opening the Scheme to all people overseas could result in organised overseas groups lodging large scale volumes of false claims in attempts to defraud the Scheme, which could overwhelm the Scheme's resources and delay the processing of legitimate applications.[53]

2.114         The initial analysis stated that the objective of ensuring the integrity of a scheme to provide redress for victims of sexual abuse (such as protection against fraudulent claims) may be capable of being a legitimate objective for the purposes of human rights law, but the statement of compatibility did not provide sufficient information about the importance of this objective in the specific context of the measure. In order to show that the measure constitutes a legitimate objective for the purposes of international human rights law, a reasoned and evidence-based explanation of why the measure addresses a substantial and pressing concern is required. It was noted that reducing administrative burdens or administrative inconvenience alone will generally be insufficient for the purposes of permissibly limiting human rights under international human rights law. It was also not clear whether there was evidence to suggest that large scale volumes of attempted fraud of the scheme may arise if non-citizens were included in the scheme, noting that the Royal Commission into Institutional Responses to Child Sexual Abuse concluded that it saw 'no need for any citizenship, residency or other requirements, whether at the time of the abuse or at the time of the application for redress'.[54]

2.115         In relation to the proportionality of the measure, the statement of compatibility noted that it will be possible to deem additional classes of people eligible for redress under the rules. The statement of compatibility explains that:

This rulemaking power may be used to deem the following groups of non-citizen, non-permanent residents eligible: those currently living in Australia, those who were child migrants, and those who were formerly Australian citizens or permanent residents.[55]

2.116         It was not clear from the information provided why it is necessary to include these classes of eligibility in a separate legislative instrument,[56] rather than in the primary legislation. Inclusion in the primary legislation of the classes of non-nationals foreshadowed in the statement of compatibility as being likely to be ruled eligible by the minister may be a less rights-restrictive means of achieving the stated objective of the measure.

2.117         The committee therefore sought the advice of the minister as to:

• whether the restriction on non-citizens' and non-permanent residents' eligibility for redress under the scheme is aimed at achieving a legitimate objective for the purposes of human rights law (including any information or evidence to explain why the measure addresses a pressing and substantial concern);
• how the measure is effective to achieve (that is, rationally connected to) that objective; and
• whether the restriction on non-citizens' and non-permanent residents' eligibility for the scheme is proportionate to achieve the stated objective (including whether there are less rights-restrictive means available to achieve the stated objective).

Minister's response

2.118         In relation to whether the restriction on non-citizens' and non-permanent residents' eligibility for redress under the scheme is aimed at achieving a legitimate objective, the minister's response states that, as the scheme is voluntary, it is important that the scheme provide 'appropriate architecture to support its integrity and legitimacy' to ensure maximum participation from institutions which, in turn, will maximise the opportunity for survivors to seek redress. The minister explained the difficulties of identifying and verifying the identity of those making the claim in the context of non-citizens and non-permanent residents as follows:

A core principle of the Scheme is to ensure redress is paid to those who are eligible. It is important that the Scheme can identify and verify the identity of those making a claim...

Given the comparative size of the monetary payments under the Scheme and the relatively low evidentiary burden that will be required of survivors making applications, the risk of fraud is a key concern. Verification of proof of identity is one means by which the Scheme can limit attempted fraud. Opening eligibility to non-citizens and non-permanent residents would significantly increase the difficulty of proof of identity verification for those applicants and increase overall processing times of applications. Verification of identity of those who are non-citizens and non-permanent residents would require primary documentation and verification from foreign governments and Australian embassies.

...large volumes of false claims from organised overseas groups could overwhelm the Scheme's resources and delay the processing of legitimate applications. In this regard, the Commonwealth Government is continually undertaking fraud detection work to ensure the integrity of social security payments and there is evidence of organised crime attempting to defraud the Commonwealth. However, providing evidence of this nature to the committee may compromise fraud detection activities.

2.119         In response to the committee's concern that reducing administrative burdens is generally insufficient to constitute a legitimate objective for the purposes of international human rights law, the minister explained the importance of timely decision-making in the context of the bill as follows:

...however I would emphasise that the nature of the survivor cohort is such that timeliness in processing Scheme applications is critical. Over half of the survivors anticipated to apply to the Scheme are over the age of 50, and so significant delays to the processing of applications may result in survivors passing away before they have the opportunity to apply for or accept redress. It is widely recognised that survivors of child sexual abuse also experience poorer health and social outcomes, amplifying the need for timely decision-making and for promoting the rights of survivors.

It is important that our policy settings support the integrity and appropriate targeting of payments. Should the Scheme not safeguard against potential fraud, institutions may choose not to participate, or may seek to leave the Scheme.

2.120         The minister's response provides reasoning and an evidence-based explanation of how the measure addresses a substantial and pressing concern. The information provided in the minister's response indicates that the measure is likely to pursue a legitimate objective for the purposes of international human rights law.  Restricting eligibility criteria of non-citizens and non-permanent residents also appears to be rationally connected to the stated objective.

2.121         As to whether the limitation is proportionate to achieving the stated objective, the minister's response notes that it is necessary for the classes of non-citizens referred to in the explanatory memorandum to be contained in a separate legislative instrument because investigation and consultation is continuing across government and with states and territories to determine if there are other classes of survivors that do not fit within the citizenship requirements that should be deemed eligible for the scheme. The minister further explains:

There may also be classes of survivors that will apply for redress that the Scheme has not, or could not, envisage including in the legislation. The Scheme may not have accounted for categories of survivors that it needs to deal with promptly, to ensure the timely processing of applications and the best outcomes for survivors so subclause 16(2) of the Commonwealth Bill is necessary to allow the Scheme to respond to situations as they arise....

Restricting the eligibility of non-citizens and non-permanent residents is necessary to achieve the legitimate aims of ensuring that survivors are provided the redress to which they are entitled in a timely manner, and that redress is provided only to those who submit genuine claims. Subsection 16(2) of the Commonwealth Bill will allow discretion to deem categories of survivors eligible despite these restrictions, such as child migrants. This ensures that the limitation of survivors' rights is proportionate.

I am considering the committee's suggestion to include these predetermined cases in primary legislation in the context of any future legislation developed to reflect a national redress Scheme.

2.122         The concern as to the proportionality of precluding non-citizens and non-permanent residents from being eligible for the scheme is informed by the conclusion of the Royal Commission into Institutional Responses to Child Sexual Abuse that it saw 'no need for any citizenship, residency or other requirements, whether at the time of the abuse or at the time of the application for redress'.[57] As victims of violations of human rights within Australia's jurisdiction are entitled to a remedy for breaches of those rights irrespective of their residency or citizenship status, there are concerns that some survivors of child sexual abuse that would otherwise be eligible for the scheme may lose access to a remedy. However, as the minister's response explains, the power to determine in the rules further classes of persons eligible for redress notwithstanding the citizenship and residency requirements may address these concerns. If the bill is passed, the committee will consider the human rights implications of the rules once they are received.

Committee response

2.123        The committee thanks the minister for his response and has concluded its examination of this issue.

2.124        The preceding analysis indicates that restricting the eligibility of non-citizens and non-permanent residents engages and limits the right to equality and non-discrimination. While the measure pursues a legitimate objective, there are concerns that the breadth of the restriction on the eligibility of all non-citizens and non-permanent residents may not be proportionate. However, setting out further classes of persons who may be eligible in the proposed redress scheme rules, including those who would otherwise be excluded due to not being citizens or permanent residents, may be capable of addressing these concerns. If the bill is passed, the committee will consider the human rights implications of the legislative instrument once it is received.

2.125        The committee notes that the minister has indicated he will consider including further classes of persons who will be eligible for the scheme in any future legislation developed to reflect a national redress scheme.

Compatibility of the measure with the right to an effective remedy for breaches of human rights

2.126         Article 2(3) of the ICCPR requires State parties to ensure that persons whose human rights have been violated have access to an effective remedy. States parties are required to establish appropriate judicial and administrative mechanisms for addressing claims of human rights violations under domestic law, and to make reparation to individuals whose rights have been violated. Effective remedies can involve restitution, rehabilitation and measures of satisfaction – such as public apologies, public memorials, guarantees of non-repetition and changes in relevant laws and practices – as well as bringing to justice the perpetrators of human rights violations. Such remedies should be appropriately adapted to take account of the special vulnerabilities of certain categories of persons, including, and particularly, children.

2.127         The redress scheme seeks to provide remedies in response to historical failures of the Commonwealth and other government and non-government organisations to uphold human rights obligations, including the right of every child to protection by society and the state,[58] and the right of every child to protection from all forms of physical and mental violence, injury or abuse (including sexual exploitation and abuse).[59] As acknowledged in the statement of compatibility, by implementing a redress scheme for victims who were sexually abused as children, the scheme promotes the right to state-supported recovery for child victims of neglect, exploitation and abuse under article 39 of the CRC.[60]

2.128         The power in proposed subsections 16(2) and (3) to determine eligibility by way of the proposed rules is broad and, in particular, the minister has a very broad power to determine persons to be ineligible for the scheme. It was noted in the initial analysis that in media reports concerning the introduction of the bill, the minister foreshadowed that he proposes to exclude persons from being eligible if they have been convicted of sex offences, or sentenced to prison terms of five years or more for crimes such as serious drug, homicide or fraud offences.[61]

2.129         International human rights law jurisprudence states that laws conferring discretion or rule-making powers on the executive must indicate with sufficient clarity the scope of any such power or discretion conferred on competent authorities and the manner of its exercise.[62] This is because, without sufficient safeguards, broad powers may be exercised in such a way as to be incompatible with human rights. The initial analysis noted that the breadth of the power to determine eligibility or ineligibility contained in the bill may therefore engage and limit the right of survivors of sexual abuse to an effective remedy. The statement of compatibility does not acknowledge that the right to an effective remedy is engaged by this aspect of the bill.[63]

2.130         While the statement of compatibility discusses limiting eligibility of persons on the basis of survivors' nationality and residency status,[64] no information is provided in the statement of compatibility as to the rationale for a broad power to determine eligibility or ineligibility by way of the proposed rules. As limited information has been provided in the statement of compatibility on this point, it is not possible to determine the extent to which the right to an effective remedy may be engaged and limited by this aspect of the bill, and whether such a limitation is permissible.

2.131         The committee therefore sought the advice of the minister as to the compatibility of the measure with the right to an effective remedy.

Minister's response

2.132         In relation to the rationale for using the rules to provide for further classes of eligibility or ineligibility rather than the primary legislation, the minister explained:

The Scheme is designed to be responsive to survivors' and participating institutions' needs. Flexibility is needed to allow adjustments for the differing needs of survivors, participating institutions, and to enable the Scheme to quickly implement changes required to ensure positive outcomes for survivors. This is why it is necessary for elements of the Scheme to be in delegated legislation.

Using rules, rather than regulations or incorporating all elements of the Scheme in the Commonwealth Bill, provides appropriate flexibility and enables the Scheme to respond to factual matters as they arise. It is uncertain how many applications for redress the Scheme will receive at its commencement, and whether there will be unforeseen issues requiring prompt responses. It is therefore appropriate that aspects of the Scheme be covered by rules that can be adapted and modified in a timely manner. The need to respond quickly to survivor needs is also a key feature of the Scheme as many survivors have waited decades for recognition and justice.

2.133         Responding quickly and with flexibility to survivors' needs and seeking to ensure positive outcomes for survivors in the redress scheme is relevant to providing an effective remedy for violations of human rights.

2.134         As to how the power is proposed to be exercised, the minister explained that subsection 16(3) would be used in 'exceptional circumstances', excluding persons from the scheme if they have been convicted of sex offences, or sentenced to prison terms of five years or more for crimes such as serious drug, homicide or fraud offences.  In relation to this proposed exclusion, the minister explained:

As the committee rightly highlights, this significant matter should not be delegated to subordinate legislation. The limitation on eligibility for persons with criminal convictions will therefore be included in the primary legislation of the proposed National Bill. There could be a perception that the Commonwealth Bill limits the rights to effective remedy for survivors with criminal convictions. However, the decision was made that in order to give integrity and public confidence to the Scheme, there had to be some limitations for applications from people who themselves had committed serious offences, but particularly sexual offences.

The eligibility policy has been developed in consultation with State and Territory Attorneys-General, who were almost unanimous in their view that reasonable limitations on applications is necessary to have public faith and confidence in the Scheme. Excluding some people based on serious criminal offences is necessary to ensure taxpayer money is not used to pay redress to those who may not meet prevailing community standards.

2.135         Noting Australia's obligation to provide effective remedies for victims of human rights violations, any proposed restrictions on eligibility on persons with criminal records will need to be carefully considered. In this respect, the UN Human Rights Committee has stated that the right to an effective remedy is an obligation inherent in the ICCPR as a whole and so, while limitations may be placed in particular circumstances on the nature of the remedy provided (judicial or otherwise), there is an absolute obligation to provide  a remedy that is effective.[65]

2.136         Relevantly, in relation to the matters raised by the minister, the Final Report noted the impact of child sexual abuse on a survivor may manifest itself in 'interconnected and complex ways', including the development of 'addictions after using alcohol or other drugs to manage the psychological trauma of abuse, which in turn affected their physical and mental health, sometimes leading to criminal behaviour and relationship difficulties.'[66] A number of survivors who appeared before the royal commission had described how the impact of child sexual abuse had contributed to criminal behaviour as adolescents and adults.[67] This information raises concerns as to whether there is a reasoned and evidence-based explanation of how the proposed exclusion addresses a substantial and pressing concern, and whether any such exclusion is proportionate.

2.137         However, the minister further explained the discretion to determine eligibility for redress of survivors, including survivors who have criminal convictions:

However, the Scheme Operator will have discretion at subsections 16(2) and (3) of the Commonwealth Bill to determine the eligibility of survivors applying for redress on a case-by-case basis, including survivors who are currently, or have been, incarcerated. Importantly, the Scheme Operator can use this discretion to deem a person eligible for redress if they are otherwise ineligible due to the criminal convictions exclusions. In considering whether to exercise discretion, the Scheme Operator will consider the nature of the crime committed, the duration of the sentence and broader public interest issues. The Scheme Operator discretion is also intended to mitigate the impact of jurisdictional differences in crimes legislation. For example, mandatory minimum sentences for certain offences may lead to some applicants receiving longer sentences than they would in other jurisdictions, and perhaps making them ineligible for the Scheme.

2.138         The minister also explained that 'all aspects of the Scheme have been subject to ongoing consultation' and that any legislative changes, including creating or amending legislative instruments, would be undertaken in consultation and agreement of a proposed Board of Governance established to advise on the scheme. The ability of the scheme operator to exercise discretion in the way proposed by the minister may address some of the concerns in relation to the compatibility of the measure with the right to an effective remedy, insofar as it places limits on how the broad power may be exercised and may ensure that survivors are eligible for the scheme. The committee will assess the human rights compatibility of any proposed rules or provisions in the proposed national bill that excludes persons convicted of certain offences once it is introduced.

Committee response

2.139        The committee thanks the minister for his response and has concluded its examination of this issue.

2.140        Noting the broad scope of the proposed power to determine eligibility or ineligibility in the national redress scheme rules, there may be concerns as to the compatibility of this measure with the right to an effective remedy. In particular, there are concerns in relation to the proposed exclusion of persons with certain criminal convictions from being eligible for the scheme. However, the discretion of the scheme operator to determine eligibility of survivors if they are otherwise ineligible may be capable of addressing some of these concerns. If the bill is passed, the committee will consider the human rights implications of any legislative instrument or proposed National Redress Scheme for Institutional Child Sexual Abuse Bill when it is received or introduced.

2.141        The committee notes the minister's intention to include any limitation on eligibility for persons with criminal convictions in the primary legislation of the proposed National Redress Scheme for Institutional Child Sexual Abuse Bill.

Power to determine when a participating institution is not responsible for sexual or non-sexual abuse

2.142         Proposed section 21 of the bill sets out when a participating institution is responsible for abuse. Subsection 21(7) provides that a participating institution is not responsible for sexual or non-sexual abuse of a person if it occurs in circumstances prescribed by the rules as being circumstances in which a participating institution is not, or should not be treated as being, responsible for the abuse of a person.

Compatibility of the measure with the right to an effective remedy for breaches of human rights

2.143         The statement of compatibility does not acknowledge that the right to an effective remedy is engaged by the power to determine by way of rules when a participating institution is not responsible for sexual or non-sexual abuse. However, as noted earlier, broad rule-making powers conferred on the executive may be incompatible with the right to an effective remedy where those powers are exercised in a manner that is incompatible with the right. Further, where public officials or state agents have committed violations of human rights, states parties concerned may not relieve perpetrators from personal responsibility through the granting of amnesties, legal immunities and indemnities.[68]  

2.144         The explanatory memorandum provides that proposed subsection 21(7) is intended to ensure that institutions are not found responsible for abuse that occurred in circumstances where it would be unreasonable to hold the institution responsible. The explanatory memorandum states by way of example that such circumstances may include where child sexual abuse was perpetrated by another child and the institution could not have foreseen this abuse occurring and could not be considered to have mismanaged the situation.[69]

2.145         As limited information has been provided in the statement of compatibility on this point, the initial analysis stated that it is not possible to determine the extent to which the right to an effective remedy may be engaged and limited by this aspect of the bill. The committee therefore sought the advice of the minister as to the compatibility of the measure with the right to an effective remedy.

Minister's response

2.146         The minister's response provides the following information in relation to the committee's inquiries:

As the Committee has noted, subclause 21(7) of the Commonwealth Bill is intended to operate to ensure that participating institutions are not found responsible for abuse that occurred in circumstances where it would be unreasonable to hold the institution responsible.

The power in subclause 21(7) will also be used to clarify circumstances where a participating government institution should not be considered responsible. Such circumstances may include:

• where the government only had a regulatory role over a non-government institution;
• where the government only provided funding to a non-government institution; and
• where the only connection is that the non-government institution was established under law enacted by the government.

Until institutions opt in to the Scheme, it is not possible to envisage every possible circumstance to include in the legislation. These rulemaking provisions allow the Scheme to be responsive to the realities of implementation, which is necessary to achieve the legitimate aim of public and institutional support for the Scheme. Were the Scheme too fixed in its methodology, the Scheme may face criticism for reaching unreasonable decisions.

2.147         Providing for a national redress scheme that is responsive to issues that arise in relation to the scheme's implementation is likely to be a legitimate objective for the purposes of international human rights law, and providing a rule-making power to address such issues is likely to be rationally connected to this objective.  As noted in the initial analysis, the concerns arise in relation to how the rule-making power may be exercised. Were the power to be exercised in a manner that was to relieve perpetrators from personal responsibility, this may be incompatible with the right to an effective remedy. However, the examples provided by the minister in his response indicate that the rule-making power may be exercised where a participating institution's role was minimal. If the bill is passed, the committee will consider the human rights implications of the instrument once it is received.

Committee response

2.148        The committee thanks the minister for his response and has concluded its examination of this issue.

2.149        Noting the broad scope of the proposed power to determine by way of rules when a participating institution is not responsible for sexual or non-sexual abuse, there may be human rights concerns in relation to its operation. This is because its scope is such that it could be used in ways that may risk being incompatible with the right to an effective remedy. If the bill is passed, the committee will consider the human rights implications of any redress scheme rules once they are received.

Bar on future civil liability of participating institutions

2.150         Proposed sections 39 and 40 of the bill provide that where an eligible person receives an offer of redress and chooses to accept that offer, the person releases and forever discharges all institutions participating in the scheme from all civil liability for abuse of the person that is within the scope of the scheme, and the eligible person cannot (whether as an individual, a representative party or a member of a group) bring or continue any civil claim against those participating institutions in relation to that abuse.

Compatibility of the measure with the right to an effective remedy for breaches of human rights

2.151         As noted earlier, the right to an effective remedy requires State parties to the ICCPR to establish appropriate judicial and administrative mechanisms for addressing claims of human rights violations, and further requires that State parties may not relieve perpetrators from personal responsibility for breaches of human rights. 

2.152         Insofar as the bill requires persons who accept an offer of redress under the scheme to relinquish their right to seek further civil remedies from responsible institutions for sexual abuse and related non-sexual abuse, the bill may engage the right to an effective remedy. The statement of compatibility acknowledges that the right to an effective remedy may be engaged and limited by this aspect of the bill, but considers that any limitation is reasonable, necessary and proportionate to ensuring the scheme's integrity and proper functioning.[70] In particular, the statement of compatibility explains:

Due to its non-legalistic nature, redress through the Scheme will be a more accessible remedy for eligible survivors than civil litigation. Entitlement to redress is determined based on a standard of ‘reasonable likelihood’, which is lower than the standard for determining the outcome of civil litigation, which is the balance of probabilities. The availability of redress is dependent on the extent to which Territory government and non-government institutions opt-in to the Scheme. Consultation has shown that institutions are not likely to opt-in to the Scheme if they remained exposed to paying compensation through civil litigation in addition to paying monetary redress. Attaching the release to entitlement to all elements of redress is necessary to encourage institutions to opt-in and to make redress available to the maximum number of survivors.[71]

2.153         However, relinquishing a person's opportunity to pursue civil litigation and possible common law damages is a significant decision for a victim of abuse to make, particularly as the amount to be provided under the redress scheme is capped at $150,000.[72] The minister explains that, in order to acknowledge the limitation on the right to an effective remedy that arises from this aspect of the bill:

...the Scheme will deliver free, trauma informed, culturally appropriate and expert Legal Support Services. These services will be available to survivors for the lifetime of the Scheme at relevant points of the application process, and will assist survivors to understand the implications of releasing responsible institutions from further liability. This means that survivors will be able to make an informed choice as to whether they wish to accept their offer and in doing so release the institution from civil liability for abuse within the scope of the Scheme or seek remedy through other avenues.[73] 

2.154         Notwithstanding the description of the proposed legal support services described in the statement of compatibility, the bill itself includes limited detail as to the provision of legal advice to survivors of sexual abuse. Proposed section 37(1)(g) of the bill requires that a written offer of redress to an eligible person 'gives information about the opportunity for the person to access legal services under the scheme for the purposes of obtaining legal advice about whether to accept the offer'. The provision of legal services under the scheme is to be determined by legislative instrument.[74] The initial analysis stated that further information as to the content of the proposed rules relating to the provision of legal services would assist in determining whether this will serve as a sufficient safeguard so as to support the measure constituting an effective remedy.[75]

2.155         The committee therefore sought the advice of the minister as to the compatibility of the measure with the right to an effective remedy, in particular the content of the proposed rules relating to the provision of legal services under the scheme.

Minister's response

2.156         In response, the minister provided the following information:

The measure is supported by proportionate and essential safeguards for survivors through the provision of a free community-based legal service to ensure survivors understand the legal implications of signing a release. The free community-based legal service will be available to survivors at the commencement of their engagement with the Scheme. The website, helpline and other engagement documents will make it clear to survivors that a release will be required in order to receive redress under the Scheme. The Scheme will make available legal advice during this process so that survivors understand the legal implications.

The Rules will include a provision which provides funding for legal services for the purposes of a person receiving trauma informed, culturally appropriate and expert legal advice as required throughout the Scheme.

Legal services will be available during the four key stages of the redress application process:

1. prior to application so survivors understand eligibility requirements and the application process of the Scheme;
2. during completion of a survivor's application;
3. after a survivor has received an offer of redress (including if they elect to seek an internal review); and
4. on the effect of signing a Deed of Release (DoR), including its impact on the prospect of future litigation.

Survivors will be able to obtain free legal assistance on an ongoing basis as required across each of the above four stages.

The Rules will also include a provision that allows a person who cannot access the funded legal service because of a conflict of interest, to be referred to another legal firm and have their legal costs covered by the Scheme's legal services provider.

In relation to the release, legal support could include:

• providing an explanation of the factors which make up the offer survivors have received and the matters considered by the assessment team;
• identifying the potential rights that the survivor is releasing; and
• helping the survivor decide whether they wish to accept the offer or not.

2.157         This information provides useful further information as to the content of the proposed rules relating to the provision of legal services. However, whether the safeguards are sufficient so as to be compatible with the right to an effective remedy will depend on the precise wording of the rules, and therefore the committee will consider the human rights compatibility of the rules when the instrument is received.

Committee response

2.158        The committee thanks the minister for his response and has concluded its examination of this issue.

2.159        The bar on future civil liability of participating institutions may engage and limit the right to an effective remedy. However, the proposed rules governing the provision of legal services under the redress scheme may operate as a sufficient safeguard so as to support the human rights compatibility of the measure. The committee will consider the compatibility of the proposed rules governing the provision of legal services, and whether they offer adequate safeguards, when they are received.

Information Sharing Provisions

2.160         Proposed section 77 of the bill sets out the circumstances in which the Commonwealth Redress Scheme Operator[76] (the Operator) may disclose protected information. 'Protected information' is defined in proposed section 75 of the bill as information about a person obtained by an officer for the purposes of the scheme that is or was held by the department. The Operator can disclose such protected information if it was acquired by an officer in the performance of their duties or in the exercise of their powers under the bill if the Operator certifies that the disclosure is necessary in the public interest in a particular case or class of case, and the disclosure is to such persons and for such purposes as the Operator determines.[77] Disclosure may also be made by the Operator to certain persons set out in the bill, including the secretary of a department, the chief executive of Centrelink and the chief executive of Medicare.[78]

Compatibility of the measure with the right to privacy

2.161         The right to privacy includes respect for informational privacy, including the right to respect for private and confidential information, particularly the storing, use and sharing of such information; and the right to control the dissemination of information about one's private life.

2.162         The information sharing powers of the Operator in proposed section 77 of the bill engage and limit the right to privacy by providing for the disclosure of protected information. As acknowledged in the statement of compatibility, this protected information may include highly sensitive information about child sexual abuse the person has experienced.[79]

2.163         The right to privacy may be subject to permissible limitations which are provided by law and are not arbitrary. In order for limitations not to be arbitrary, the measure must pursue a legitimate objective and be rationally connected and proportionate to achieving that objective.

2.164         As outlined in the initial analysis, the statement of compatibility acknowledges that the right to privacy is engaged by the information sharing provisions in the bill, which includes proposed section 77. However, the statement of compatibility explains any limitation by the information sharing provisions on the right to privacy is permissible, as the provisions are 'necessary to achieve the legitimate aims of assessing eligibility under the Scheme and protecting children from abuse, and are appropriately limited to ensure that they are a proportionate means to achieve those aims'.[80]

2.165         The initial analysis stated that the objective of protecting children from abuse is a legitimate objective under international human rights law. Collecting, using and disclosing this information to relevant bodies so as to prevent abuse and provide redress is likely to be rationally connected to this objective.

2.166         As to the proportionality of the measure, limitations on the right to privacy must be no more extensive than what is strictly necessary to achieve the legitimate objective of the measure. The statement of compatibility explains the broad rationale for allowing persons to obtain and disclose protected information for the purposes of the scheme as follows:

To establish eligibility, survivors will be required to supply the Scheme with personal information including highly sensitive information about the child sexual abuse they experienced. To progress the application to assessment, limited survivor and alleged perpetrator details will be provided, with the survivor’s consent, to the participating institutions identified in their application.  Participating institutions will be able to use this information in a limited way to facilitate making insurance claims and to institute internal disciplinary procedures where an alleged perpetrator or person with knowledge of abuse is still associated with the institution. Participating institutions will be required to provide the Scheme with specific information pertaining to survivors and alleged perpetrators, including survivor and the alleged perpetrator’s involvement with the institution, any related complaints of abuse made to the institution and details of any prior payments made to the survivor. This collection and exchange of information is necessary for the eligibility assessment process and information under the Scheme will be subject to confidentiality.  Outside of Scheme representatives, only survivors and those they nominate will have access to records relating to their application.  Strict offence provisions will be put in place to mitigate risks of unlawful access, disclosure, recording, use, soliciting or offering to supply Scheme information.[81]

2.167         However, the statement of compatibility does not appear to address the proportionality of the bill insofar as it relates to the Operator's disclosure powers in proposed section 77. The power in proposed section 77 for the Operator to disclose information is very broad: the Operator can disclose protected information to 'such persons and for such purposes as the Operator determines', provided the Operator considers it necessary in the public interest to do so.[82] It is not clear from the statement of compatibility whether it is strictly necessary to include such a broad category of persons to whom disclosure may be made by the Operator, and what circumstances will constitute a 'public interest', which raises concerns that these information sharing provisions may not be sufficiently circumscribed. 

2.168         Another relevant factor in assessing proportionality is whether there are adequate safeguards in place to protect the right to privacy. It was noted that there are penalties in place for persons who engage in unauthorised recording, disclosure or use of protected information.[83] However, the powers of the Operator to disclose information in the public interest in proposed section 77 do not appear to be accompanied by safeguards present in other information sharing provisions in the bill, such as a requirement that the Operator consider the impact disclosure may have on a person to whom the information relates. By way of contrast, it was noted that there is a separate provision in section 78 of the bill addressing disclosure of protected information to certain agencies (such as the Australian Federal Police or state and territory police forces) for the purposes of law enforcement or child protection, where there is a safeguard in place that requires the Operator to have regard to the impact the disclosure might have on the person,[84] as well as a requirement that the Operator is satisfied that disclosure of the information is reasonably necessary for the enforcement of the criminal law or for the purposes of child protection.[85] Further, the initial analysis stated that disclosure for other purposes such as for the purpose of the participating institution facilitating a claim under an insurance policy must only occur if there has been consideration to the impact that disclosure might have on the person who has applied for redress.[86] It is not clear from the statement of compatibility why such safeguards are available in relation to some information sharing provisions in the bill, but not in relation to the Operator's disclosure powers in proposed section 77.

2.169         The committee therefore sought the advice of the minister as to whether the limitation on the right to privacy is proportionate to the stated objective of the measure (including whether there are adequate safeguards in place in relation to disclosure by the Operator of protected information).

Minister's response

2.170         The minister's response provides the following information in relation to the committee's inquiries:

Section 77 of the Commonwealth Bill has been drafted to reflect similar provisions in other legislation within the Social Services portfolio, which routinely deals with a person's sensitive information and provides a consistent approach to the way in which the Department deals with protected information. It was considered appropriate to provide a power to enable rules to be made by the Minister if it was considered necessary to assist with the exercise of the Scheme Operator's disclosure of protected information. This provides flexibility to address any circumstances that arise which are of sufficient public interest to warrant the exercise of that power. Incorporating high-level rules in the Commonwealth Bill would restrict the Scheme Operator's power to make a public interest disclosure to those circumstances set out in the Commonwealth Bill.

Careful consideration will be given to ensure that any personal information held by the Scheme Operator is given due and proper protection. It is envisaged the power to make public interest disclosures will only be used where it is necessary to prevent, or lessen, a threat to life, health or welfare, for the purpose of briefing the Minister or if the information is necessary to assist a court, coronial inquiry, Royal Commission, or similar, for specific purposes such as a reported missing person or a homeless person. These criteria are some of those that are already outlined in other legislation in the Social Services portfolio that govern public interest certificates, such as the Social Security (Public Interest Certificate Guidelines) (DSS) Determination 2015 and the Paid Parental Leave Rules 2010.

Despite there not being a positive requirement in the Commonwealth Bill, the intention is to make rules to regulate the Scheme Operator's disclosure power to ensure that the limitation on the right to privacy is proportionate to achieve the various legitimate aims of public interest disclosures. However, the Committee's concerns are noted and I will consider including a positive requirement for rules in the National Bill, including a requirement that the Scheme Operator must have regard to the impact the disclosure may have on a person to whom the information relates.

2.171         The minister's response provides useful information as to the scope of the Operator's power to make public interest disclosures. In particular, the minister's explanation that the power is proposed to be exercised in similar circumstances to those outlined in other instruments that govern public interest certificates such as the Social Security (Public Interest Certificate Guidelines) (DSS) Determination 2015, suggests any disclosure of personal information would be exceptional.[87] Disclosure in the circumstances outlined by the minister (namely, where it is necessary to prevent, or lessen, a threat to life, health or welfare, for the purpose of briefing the Minister or if the information is necessary to assist a court, coronial inquiry, Royal Commission, or similar, for specific purposes such as a reported missing person or a homeless person) would likely be sufficiently circumscribed so as to constitute a proportionate limitation on the right to privacy.

2.172         It is also noted that the minister intends to make rules regulating the Scheme Operator's disclosure power and is also considering including a positive requirement for rules in any proposed national bill, as well as a safeguard by requiring the Scheme Operator to have regard to the impact disclosure may have on a person to whom the information relates. Such matters would likely address the concerns outlined in the initial analysis as to the scope of the power and the sufficiency of safeguards.

Committee response

2.173        The committee thanks the minister for his response and has concluded its examination of this issue.

2.174        The further information provided by the minister indicates that the power to make public interest disclosures will only be used where it is necessary to prevent, or lessen, a threat to life, health or welfare, for the purpose of briefing the minister or if the information is necessary to assist a court, coronial inquiry, Royal Commission, or similar, for specific purposes such as a reported missing person or a homeless person. The committee notes that disclosure in such circumstances may be sufficiently circumscribed such that the measure would be a proportionate limitation on the right to privacy. The committee recommends that the Scheme Operator's disclosure power be monitored by government to ensure that any limitation on the right to privacy be no more extensive than what is strictly necessary.

2.175        The committee will consider the human rights compatibility of the proposed rules to regulate the Scheme Operator's disclosure power when they are received.

2.176        The committee notes that the minister has indicated he will consider including a positive requirement that the Scheme Operator must have regard to the impact the disclosure may have on a person to whom the information relates in any future legislation developed to reflect a national redress scheme, and will also consider including a positive requirement for rules to regulate the Scheme Operator's disclosure power.

Absence of external merits review and removal of judicial review

2.177         The bill establishes a system of internal review of determinations made under the scheme.[88] No provision is provided in the bill for determinations to be able to be subject to external merits review. Pursuant to the internal review procedure, a person may apply to the Operator to review a determination made in relation to redress and the Operator must cause that determination to be reviewed by an independent decision-maker to whom the Operator's power under this section is delegated, and who was not involved in the making of the determination.[89] A person reviewing the original determination must reconsider the determination and either affirm, vary, or set aside the determination and make a new determination.[90]  When reviewing the original determination, the person may only have regard to the information and documents that were available to the person who made the original determination.[91]

2.178         The Commonwealth Redress Scheme for Institutional Child Sexual Abuse (Consequential Amendments) Bill 2017 (the consequential amendments bill) exempts decisions made under the scheme from judicial review under the Administrative Decisions (Judicial Review) Act 1977 (ADJR Act).[92]

Compatibility of the measure with the right to a fair hearing

2.179         Article 14(1) of the ICCPR requires that in the determination of a person's rights and obligations in a suit at law, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. A determination of a person's entitlement to redress as a result of sexual abuse, and a finding of responsibility on the part of institutions for such abuse, involves the determination of rights and obligations and therefore is likely to constitute a suit at law.[93]

2.180         The initial analysis stated that the absence of external merits review and the removal of a form of judicial review may engage and limit the right to a fair hearing, as it limits survivors' opportunities to have their rights and obligations determined by an independent and impartial tribunal. However, the statement of compatibility does not acknowledge that the right to a fair hearing is engaged by the measures.

2.181         A limitation on the right to a fair hearing may be permissible if it pursues a legitimate objective, is rationally connected to that legitimate objective and is a proportionate means of achieving that objective.

2.182         The explanatory memorandum to the consequential amendments bill explains the rationale for limiting the scheme to internal review and the removal of judicial review. In particular, the explanatory memorandum explains that judicial review may cause undue administrative delays under the scheme, and the internal review mechanism is intended to prevent re-traumatising victims through having to re-tell their story of past institutional child sexual abuse. 

2.183         Preventing re-traumatisation of victims of sexual abuse is likely to be a legitimate objective under international human rights law. However, in circumstances where the victim themselves may choose to pursue external review (by way of merits review or judicial review) if they are unsatisfied with the decision, it is not clear based on the information provided that preventing victims from pursuing external review if dissatisfied with the internal decision would be an effective means of achieving this objective.

2.184         Further, the explanatory memorandum explains that, when internally reviewing the decision, the Operator or independent decision-makers are not permitted to have been involved in making the original decision under review.  However, it was unclear whether the internal review mechanism provides greater or lesser scope for independent and impartial review than that which would be provided by the (external) Administrative Appeals Tribunal. It was not clear, therefore, whether the internal review mechanism is an effective substitute for external review.

2.185         The committee therefore sought the advice of the minister as to the compatibility of the measure with the right to a fair hearing, including:

• whether the absence of external merits review and removal of judicial review pursues a legitimate objective;
• whether the measures are rationally connected to (that is, effective to achieve) that objective; and
• whether the measures are a proportionate means of achieving the stated objective.

Minister's response

2.186         The minister's response provides the following information on the internal review mechanism:

The decision to exclude external merits review for applicants was made on the advice of the Independent Advisory Council on Redress and following the Royal Commission's recommendation on this matter. The Council recommended the Scheme provide survivors with access to an internal review process, but no access to external merits or judicial review as it considered that providing survivors with external review would be overly legalistic, time consuming, expensive and would risk further harm to survivors. If judicial review avenues were available, many survivors may have unrealistic expectations of what could be achieved given the low evidentiary barrier to entry to the Scheme compared to civil litigation, and that therefore the judicial review process is likely to re-traumatise a survivor.

The Department of Social Services will recruit appropriately qualified, independent assessors, known as Independent Decision Makers, who will make all decisions on applications made to the Scheme. Independent Decision Makers will not report or be answerable to Government. These Independent Decision Makers will be able to provide survivors with access to independent and impartial review without subjecting them to potential re-traumatisation.

Members of the Administrative Appeals Tribunal are appointed based on their judicial experience, not recruited for the skillset and understanding of the survivor cohort that will be required of Independent Decision Makers. The Administrative Appeals Tribunal must make a legally correct or preferable decision, while Independent Decision Makers will make decisions on applications with highly variable levels of detail and without strict legislative guidance on what weight should be applied to the information they do receive. Without an understanding of past decisions under the Scheme, the Tribunal may reach decisions that are inconsistent with past decisions made by Independent Decision Makers. Utilising the Administrative Appeals Tribunal for merits review under the Scheme risks inappropriately imposing a legalistic lens on a non-legalistic decision making process.

2.187         The minister's response provides useful information as to the rationale for excluding external merits review and the proposed operation of the internal review scheme with Independent Decision Makers. Having regard to this information and the particular context in which the review scheme operates, the internal review mechanism may be capable of ensuring that survivors have adequate opportunities to have their rights and obligations determined in a manner that is compatible with the right to a fair hearing.  It is also noted that the consequential amendments bill, which removes judicial review under the ADJR Act, does not appear to preclude judicial review under section 75(v) of the Constitution and section 39B of the Judiciary Act 1903. However, noting that it is difficult to determine how, and the extent to which, the internal review mechanism may impact on the right to a fair hearing until it is in operation, it is recommended that the mechanism be monitored to ensure that the review mechanism operates in such a way as to ensure that survivors have sufficient opportunities to have their rights and obligations determined by an independent and impartial tribunal.

Committee response

2.188        The committee thanks the minister for his response and has concluded its examination of this issue.

2.189        Having regard to this information and the particular context in which the review scheme operates, the internal review mechanism may be capable of ensuring that survivors have adequate opportunities to have their rights and obligations determined in a manner that is compatible with the right to a fair hearing. However, the committee recommends that the operation of the internal review mechanism be monitored to ensure that survivors have sufficient opportunities to have their rights and obligations determined by an independent and impartial tribunal.

Fair Work Laws Amendment (Proper Use of Worker Benefits) Bill 2017

Background

2.190         The committee first reported on the Fair Work Laws Amendment (Proper Use of Worker Benefits) Bill 2017 (the bill) in its Report 12 of 2017, and requested a response from the Minister for Employment by 13 December 2017.[94]

2.191         The minister's response to the committee's inquiries was received on 19 December 2017 and discussed in Report 1 of 2018.[95]

2.192         The committee requested a second response from the minister by
8 February 2018, specifically in relation to prohibiting terms of industrial agreements requiring or permitting payments to worker entitlement funds and the right to collectively bargain. The committee also welcomed any additional comments in relation to any other matter relevant to its consideration of the bill. A response from the Minister for Small and Family Business, the Workplace and Deregulation was received on 8 February 2018. The response is discussed below and is reproduced in full at Appendix 3.  The response addressed the committee's specific request and did not provide further comments more generally in relation to the bill.

Prohibiting terms of industrial agreements requiring or permitting payments to worker entitlement funds   

2.193         Schedule 2 of the bill would amend the Fair Work Act 2009 (Fair Work Act) to prohibit any term of a modern award or an enterprise agreement requiring or permitting contributions for the benefit of an employee to be made to any fund other than a superannuation fund, a registered worker entitlement fund or a registered charity.[96]

Compatibility of the measure with the right to freedom of association and the right to just and favourable conditions at work

2.194         The right to freedom of association includes the right to collectively bargain without unreasonable and disproportionate interference from the state. The right to just and favourable conditions of work includes the right to safe working conditions. These rights are protected by the International Covenant on Civil and Political Rights (ICCPR) and the International Covenant on Economic, Social and Cultural Rights (ICESCR).^[97]

2.195         The interpretation of these rights is informed by International Labour Organization (ILO) treaties, including the ILO Convention of 1948 concerning Freedom of Association and Protection of the Right to Organise (ILO Convention No. 87) and the ILO Convention of 1949 concerning the Right to Organise and Collective Bargaining (ILO Convention No. 98), which protects the right of employees to collectively bargain for terms and conditions of employment.^[98] The principle of 'autonomy of bargaining' in the negotiation of collective agreements is an 'essential element' of Article 4 of ILO Convention No. 98 which envisages that parties will be free to reach their own settlement of a collective agreement without interference.^[99]

2.196         Prohibiting the inclusion of particular terms in an enterprise agreement interferes with the outcomes of the bargaining process. Accordingly, the initial human rights analysis stated that the measure engages and may limit the right to just and favourable conditions of work and the right to collectively bargain as an aspect of the right to freedom of association.

2.197         Measures limiting the right to freedom of association including the right to collectively bargain may be permissible providing certain criteria are satisfied. Generally, to be capable of justifying a limit on human rights, the measure must address a legitimate objective, be rationally connected to that objective and be a proportionate way to achieve that objective.^[100] Further, Article 22(3) of the ICCPR and article 8 of the ICESCR expressly provide that no limitations are permissible on this right if they are inconsistent with the guarantees of freedom of association and the right to collectively organise contained in the ILO Convention No. 87.

2.198         The ILO's Committee on Freedom of Association (CFA Committee), which is a supervisory mechanism that examines complaints about violations of the right to freedom of association and the right to collectively bargain, has stated that 'measures taken unilaterally by the authorities to restrict the scope of negotiable issues are often incompatible with Convention No. 98'.^[101] The CFA Committee has noted that there are some circumstances in which it might be legitimate for a government to limit the outcomes of a bargaining process, stating that 'any limitation on collective bargaining on the part of the authorities should be preceded by consultations with the workers' and employers' organizations in an effort to obtain their agreement'.^[102]

2.199         Indeed, international supervisory mechanisms have previously raised specific concerns in relation to current restrictions imposed on bargaining outcomes under Australian domestic law.^[103] In relation to restrictions on the scope of collective bargaining and bargaining outcomes, CFA Committee noted that:

...the right to bargain freely with employers with respect to conditions of work constitutes an essential element in freedom of association, and trade unions should have the right, through collective bargaining or other lawful means, to seek to improve the living and working conditions of those whom the trade unions represent. The public authorities should refrain from any interference, which would restrict this right or impede the lawful exercise thereof. Any such interference would appear to infringe the principle that workers' and employers' organizations should have the right to organize their activities and to formulate their programmes.^[104]

2.200         In this respect the statement of compatibility acknowledges that the measure engages the right to freedom of association, the right to voluntarily reach bargaining outcomes, and the right to just and favourable conditions at work. However, the statement of compatibility asserts that the limitation on these rights is permissible. It states that the measure pursues the legitimate objectives of addressing 'the potential for misappropriation of funds and [to] avoid conflicts of interest and possible coercion'.[105] It points to the Final Report of the Royal Commission into Trade Union Governance and Corruption (Heydon Royal Commission) in support of this objective.^[106] While the stated objectives may be capable of constituting a legitimate objective for the purposes of international human rights law, the initial analysis noted that it would have been useful if the statement of compatibility had more fully explained how any findings from the Heydon Royal Commission supported the importance of this objective as a substantial or pressing concern.

2.201         The statement of compatibility provides some information as to whether the measure is rationally connected to (that is, effective to achieve) its stated objectives. It notes that the measure does not prohibit contributions to worker entitlement funds but requires any contributions 'to be made to registered worker entitlement funds that are subject to basic governance and disclosure requirements designed to address potential conflicts of interest, breaches of fiduciary duty and the potential for coercion'.[107] As such the measure would appear to be rationally connected to its stated objective.

2.202         However, the statement of compatibility provides limited information as to whether the limitation is proportionate. In order to be a proportionate limitation on human rights a measure must be the least rights restrictive way of achieving its stated objective.

2.203         Accordingly, the committee sought the advice of the Minister for Employment as to:

• whether the limitation is a reasonable and proportionate measure to achieve that objective (including findings by relevant international supervisory mechanisms about whether the limitation is permissible); and
• whether consultation has occurred with the relevant workers' and employers' organisations in relation to the measure.

Minister's first response

2.204         The minister's first response described the current restrictions on bargaining outcomes imposed by the Fair Work Act and restates the scope of the new restrictions. The minister's response noted that the committee's initial report stated that the limitation imposed by the measure appeared to be rationally connected to its stated objective.

2.205         In relation to whether the limitation is reasonable and proportionate to achieve the stated objective, the minister's response stated:

Any worker entitlement fund, including those controlled by any industrial association, can be registered provided it meets basic governance and disclosure requirements. These requirements are designed to address potential conflicts of interest, breaches of fiduciary duty and coercive conduct. There is no restriction on who can be a member of a fund. The provisions enhance the right to just and favourable conditions of work by ensuring that money held by worker entitlement funds is used to benefit workers. The amendments will provide employees with a guarantee that any contributions they voluntarily make to a worker entitlement fund is subject to appropriate scrutiny and oversight.

To the extent that the prohibition may engage any of these rights, the measure is reasonable and proportionate and enhances workers' rights by ensuring that money held on their behalf is protected. The amendments are the least rights restrictive possible in that they do not represent an unqualified prohibition on terms of industrial agreements that provide for contributions to worker entitlement funds. Rather, they require such contributions to be made to registered worker entitlement funds that are subject to basic governance and disclosure obligations.

The International Labour Organization (ILO) has stated that 'Restrictions on [the] principle [of leaving the greatest possible autonomy to organizations in their functioning and administration] should have the sole objective of protecting the interests of members'.

To the extent the proposed provisions may engage with these rights they do so only to protect the rights of workers by ensuring that their money is properly managed and their interests protected.

The provisions support the basic governance and disclosure requirements of the Bill that are designed to address potential conflicts of interest, breaches of fiduciary duty and potential for coercive conduct that were found by the Royal Commission into Trade Union Governance and Corruption (Royal Commission) in examining the operation in Australia of worker entitlement funds. As such, the amendment protects the interests of workers.

2.206         The minister's response provided a range of information about the scope of the limitation on bargaining outcomes. In this respect, it is relevant to the proportionality of the measure that it will still be possible to negotiate clauses in enterprise agreements which require or permit payments to be made to registered workers' entitlement funds, superannuation funds or charities. However, prohibiting any term of an enterprise agreement that otherwise requires or permits contributions for the benefit of an employee may still have significant effects on voluntarily negotiated outcomes.

2.207         As discussed further below, there are a range of restrictions on registered worker entitlement funds and who can operate them. Under the proposed bill, registered organisations including unions are prohibited from operating registered workers' entitlement funds and there are restrictions on how funds can be spent. This means that, for example, even if an employer and employees agreed through an enterprise agreement to set up an occupational health and safety training fund to be administered and run by the relevant union, this would not be permissible. It was unclear from the minister's response how prohibiting this kind of voluntarily negotiated clause in general is the least rights restrictive approach to achieving the stated objective. Further, while the minister's response referred to ILO comments about when it may be legitimate to limit particular rights, it did not address the specific concerns raised by international monitoring bodies in relation to Australia's restrictions on bargaining outcomes through prohibiting particular matters in enterprise agreements (discussed at [2.199] above). In light of the concerns raised by these international monitoring bodies as to the existing restrictions on bargaining outcomes in Australia, it is likely that any amendments which further restrict such matters would also raise concerns.

2.208         Finally, the minister's response outlined consultation which occurred with worker entitlement funds and employee and employer organisations prior to introduction. Consultation processes are relevant to an assessment of the measure, and may assist in determining whether a limitation is the least rights restrictive means of pursuing a legitimate objective on the available evidence. However, the fact of consultation alone is not sufficient to address the human rights concerns in relation to the measure.

2.209         The committee considered that, in the absence of additional information addressing these concerns, prohibiting terms of industrial agreements that require or permit payments to worker entitlement funds is likely to be incompatible with the right to collectively bargain.

2.210         The committee therefore sought further advice from the minister in relation to the compatibility of the measure with the right to collectively bargain, in particular any information in light of findings by relevant international supervisory mechanisms.

Minister's second response

2.211         The Minister for Small and Family Business, the Workplace and Deregulation provided the following information in relation to the committee's inquiries:

A detailed response to issues raised in Human Rights Scrutiny Report No. 12 of 2017 in relation to the Bill was provided to the Committee by the office of Senator the Hon Michaelia Cash, then Minister for Employment, on 19 December 2017. That response addressed the proposed prohibition on industrial instruments requiring or permitting payments to unregistered worker entitlement funds, noting that while the prohibition engages the right to collectively bargain, it does so in a manner that is reasonable and proportionate and enhances workers' rights.

The Bill prohibits terms in industrial agreements that require or permit payments only to unregistered worker entitlement funds. Registered worker entitlement funds will be required to comply with basic governance and disclosure requirements. The prohibition on payments to unregistered worker entitlement funds is simply a mechanism to ensure that such funds are properly regulated, subject to appropriate minimum governance requirements and comply with laws similar to those that apply to other managed investment schemes.

Findings from two Royal Commissions have emphasised the importance of properly regulating worker entitlement funds, particularly given the significant sums of money held by these funds for the benefit of workers, and the consequences that would follow if a fund was to fail.

Most recently, the 2016 report of the Royal Commission into Trade Union Governance and Corruption (2016 Royal Commission) recommended that legislation be enacted dealing comprehensively with the minimum governance, financial reporting and financial disclosures for worker entitlement funds. This Bill implements that recommendation.

As noted in the previous response of 19 December 2017, the International Labour Organisation (ILO) has stated that 'Restrictions on [the] principle [of leaving the greatest possible autonomy to organizations in their functioning and administration] should have the sole objective of protecting the interests of members'. It is considered that the 'functioning' of organisations includes their ability to collectively bargain, such that any restriction on collective bargaining should have the sole objective of protecting the interests of members.

A prohibition on industrial instruments requiring or permitting payments to unregistered worker entitlement funds is intended to protect the interests of members of organisations by ensuring that such payments may only be made to worker entitlement funds that are registered. A worker entitlement fund can be registered provided it meets basic governance and disclosure requirements. These requirements are designed to address potential conflicts of interest, breaches of fiduciary duty and coercive conduct. The provisions in the Bill ensure that money held by worker entitlement funds is used to benefit workers. The amendments will provide members with a guarantee that any contributions made to a worker entitlement fund is subject to appropriate scrutiny and oversight.

In addition, the ILO considers that there are some exceptions to the general rule that measures taken to restrict the scope of negotiable issues are generally considered to be incompatible with international labour standards. These include 'the prohibition of certain subjects for reasons of public order'. Further, Article 4 of the ILO Right to Organize and Collective Bargaining Convention 1949 (No. 98) specifies that the machinery for voluntary negotiation of terms and conditions of employment should be 'appropriate to national conditions'.

Given that the prohibition supports the basic governance and disclosure requirements of the Bill that are intended to address potential conflicts of interest, breaches of fiduciary duty and potential for coercive conduct outlined in the 2016 Royal Commission, in addition to protecting the interests of workers and supporting public order, it is appropriate to Australian conditions and so is permissible.

2.212         The minister's second response provides a range of further information to address the committee's inquiry. The information provided further demonstrates that the stated objective of protecting the rights and interests of members is likely to constitute a legitimate objective for the purposes of international human rights law. The minister's response shows that the measure is rationally connected to this objective by restricting payments to registered worker entitlement funds which are subject to regulation.

2.213         With reference to international supervisory mechanisms, the minister is correct to note there are exceptions to the general rule that measures taken unilaterally to restrict the scope of negotiable outcomes will generally be incompatible with the right to collectively bargain. However, concerns remain as to the proportionality of these proposed measures in light of international jurisprudence.

2.214         While the minister's response explains that negotiation on certain subjects may be prohibited for reasons of public order, it is unclear how this particular measure relates to issues of public order. Further, even if the measure did address this issue, as set out at [2.207] above, it is unclear how prohibiting voluntarily negotiated clauses in general which require or permit contributions for the benefit of an employee (other than a superannuation fund, a registered worker entitlement fund or a registered charity) is the least rights restrictive approach to achieving the stated objective.

2.215         The minister's response further points to the terms of article 4 of ILO Convention No. 98 as a basis for how the measure is permissible. Article 4  relevantly provides that:

Measures appropriate to national conditions shall be taken, where necessary, to encourage and promote the full development and utilisation of machinery for voluntary negotiation between employers or employers' organisations and workers' organisations, with a view to the regulation of terms and conditions of employment by means of collective agreements (emphasis added).

2.216         The minister's response appears to argue, drawing upon article 4, that the measure is appropriate to Australian conditions and so is permissible. However, the fact that a measure may (or may not) be appropriate to national conditions does not mean that they are necessarily permissible limitations on the right to collectively bargain under international law. Indeed, the 'measures appropriate to national conditions' referred to in article 4 are focused on those that are necessary to encourage and promote voluntary negotiation. That is, the term 'national conditions' operates not as an exception to obligations but is rather an acknowledgement that measures taken to fulfil article 4 need to take national conditions into account. By contrast, in this case, by prohibiting the inclusion of particular terms in an enterprise agreement, the measure interferes with voluntarily negotiated outcomes and thereby limits the right to collectively bargain.

2.217         Additionally, the minister's response did not address the committee's request for comment on the specific concerns raised by international monitoring bodies concerning Australia's restrictions on bargaining outcomes through prohibiting particular matters in enterprise agreements (discussed at [2.199] above). As noted previously, in light of the concerns raised by these international monitoring bodies as to the existing restrictions on bargaining outcomes in Australia, it is likely that any measures, such as this one (which further restrict such matters) would also raise concerns.

Committee response

2.218        The committee thanks the minister for his response and has concluded its examination of this issue. The committee acknowledges that the response was requested and received within a short timeframe.

2.219        The International Labour Organization's Committee on Freedom of Association has raised concerns in relation to Australia's restrictions on bargaining outcomes through prohibiting particular matters in enterprise agreements. The provisions introduced by the bill prohibiting terms of industrial agreements that require or permit payments to worker entitlement funds is a further restriction on bargaining outcomes.

2.220        Based on the information provided and the above analysis, prohibiting terms of industrial agreements that require or permit payments to worker entitlement funds is likely to be incompatible with the right to collectively bargain.

Regulation of worker entitlement funds

2.221         Schedule 2 of the bill would require 'worker entitlement funds' to meet requirements for registration and meet certain conditions relating to financial management, board composition, disclosure and how money is spent. A 'worker entitlement fund' is defined in proposed section 329HC of the Fair Work (Registered Organisations) Act 2009 (Registered Organisations Act) as a fund whose purposes include paying worker entitlements to members, dependents or legal representatives of fund members or a fund prescribed by the minister.

2.222         Under proposed new section 329LA of the Registered Organisations Act a 'worker entitlement fund' will only be able to be operated by a corporation and cannot be operated by a registered organisation (that is, a trade union or employer organisation.) Under proposed sections 329JA-B of the Registered Organisations Act it will be an offence to operate an unregistered fund and a civil penalty provision for employers to contribute to such a fund. 

Compatibility of the measure with the right to freedom of association and the right to just and favourable conditions at work

2.223         As described above, the interpretation of the right to freedom of association and the right to just and favourable conditions of work is informed by the ILO treaties.[108] ILO Convention 87 specifically protects the right of workers to autonomy of union processes, organising their administration and activities and formulating their own programs without interference.[109] Providing that registered organisations cannot administer 'worker entitlement funds' and limiting the purposes for which such money may be used appears to engage and limit these rights. However, the statement of compatibility does not acknowledge this limitation so does not provide an assessment of whether the limitation is permissible as a matter of international human rights law.[110]

2.224         The committee therefore requested the further advice of the minister as to:

• whether the measure is aimed at pursuing a legitimate objective for the purposes of international human rights law;
• how the measure is effective to achieve (that is, rationally connected to) its stated objective; and
• whether the limitation is a reasonable and proportionate measure to achieve the stated objective (including whether the measure is the least rights restrictive way of achieving its stated objective). 

Minister's first response

2.225         The minister's first response explained the scope of current provisions and proposed amendments:

Current provisions

An ASIC class order currently exempts worker entitlement funds from regulation under the Corporations Act 2001.

Contributions to 'approved worker entitlement funds' under the Fringe Benefits Tax Assessment Act 1986 (FBTA Act 1986) are exempt from fringe benefits tax. Funds can be approved if they meet certain minimum criteria, largely concerned with how fund money can be spent. This imposes a degree of indirect regulation on these funds.

Changes proposed through the Bill

The Bill will amend the Fair Work (Registered Organisations) Act 2009 (RO Act) to insert new Part 3C of Chapter 11 to apply governance, financial reporting and financial disclosure requirements to worker entitlement funds. As noted by the Committee, Schedule 2 of the Bill would require worker entitlement funds to meet requirements for registration and meet certain conditions relating to financial management, board composition, disclosure and how money is spent. These conditions include that a worker entitlement fund will only be able to be operated by a corporation and cannot be operated by a registered organisation (proposed new section 329LA condition 2).

2.226         The minister also provided a range of information as to whether the limitation on human rights imposed by the measure is permissible. In relation to whether the measure is aimed at pursuing a legitimate objective for the purposes of international human rights law, the minister's response stated:

The objective of the Bill in relation to the administration of worker entitlement funds and limiting the purposes for which worker entitlement fund income and contributions can be used is to ensure that workers' entitlements are managed responsibly and transparently and in their interests. Funds will have to be run by trained professionals of good fame and character and fund money will be restricted from being re-characterised and spent for unauthorised purposes. These measures are intended to prohibit what the Royal Commission found were substantial payments flowing out of worker entitlement funds to other parties for purposes other than paying members.

2.227         This would appear to be a legitimate objective for the purposes of international human rights law.

2.228         As to how the measure is effective to achieve the stated objective, the minister's response stated:

Requiring the registration of worker entitlement funds and placing conditions on that registration are measures that are rationally connected to the objective of ensuring that workers' entitlements are managed responsibly and transparently in their interests.

Requiring a fund operator to be a constitutional corporation is necessary to ensure that the provisions regulating such funds are valid. A similar requirement applies to superannuation funds under the Superannuation Industry (Supervision) Act 1993.

2.229         This information indicates that the regulation of worker entitlement funds is likely to be rationally connected to the stated objective of the measure.

2.230         The requirement that registered workers' entitlement funds cannot be operated by a registered organisation such as a trade union or employers' organisation raised questions in relation to the proportionality of the limitation. In this respect the minister's response explained that:

Requiring that a fund operator cannot be an organisation is designed to prevent conflicts of interest for worker entitlement funds that also make substantial payments to those organisations for purposes other than paying members worker entitlements.

In this respect, the Royal Commission stated that:

The very substantial revenue flows to unions generate significant conflicts of interest and potential breaches of fiduciary duty on the part of unions and union officials negotiating enterprise agreements ... In short, the union and union officials owe a duty to act in the interests of union member employees when negotiating enterprise agreements. At the same time, there is a significant potential and incentive for the union to act in its own interests to generate revenue.

The worker entitlement fund, Incolink, provides an example of the substantial revenue that flows to unions and employer groups. Between 2011 and 2015, the Construction, Forestry, Mining and Energy Union (CFMEU), the Master Builders Association of Victoria and the Plumbing Joint Training Fund together received over $85 million from Incolink. These organisations are all represented on the board of lncolink.

In addition, none of the existing worker entitlement funds that are approved under the FBTA Act 1986 are operated by registered organisations; most worker entitlement funds are run by corporations with a mix of representatives from employer and employee associations on their boards. The Bill does not alter this position. Officers of registered organisations can still sit on the board of worker entitlement funds.

2.231         The minister's response articulated that there is a potential for conflicts of interest in relation to the administration of such funds as well as the potentially large sums of money involved. It is also relevant to the proportionality of the measure that none of the funds registered under the existing FBTA Act are operated by registered organisations. However, it was unclear whether there are funds that are not registered under the FBTA Act which are currently administered by registered organisations. Accordingly, based on the information provided there is some uncertainty as to the potential impact of the measure. The measure may still therefore be a significant limitation on the right for a union to organise its internal affairs and formulate its own program. For example, notwithstanding the issues raised in the minister's response, it may be the preference of some union members that money paid for their benefit is administered by their union. 

2.232         The minister's response further stated, in relation to whether the measure is proportionate to achieve its stated objective, that:

The Bill also retains the existing legal limits on how contributions and income of a fund can be spent under the FBTA Act 1986.

To the extent that these measures may limit human rights, any limitation is reasonable and proportionate in achieving the objectives of the Bill. Commensurate with this, the measures are the least rights restrictive as they do not prevent contributions to worker entitlement funds but provide appropriate governance and transparency to ensure that workers' entitlements are managed responsibly and transparently in their interests. They also take into account the feedback provided by funds during consultation, including to allow funds to use income to pay for training and welfare services, subject to appropriate criteria, and the provision of a separate regulatory scheme for single employer worker entitlement funds.

2.233         While noting that contributions will still be able to be made to registered workers' entitlement funds, it was unclear from the information provided that this necessarily means that the measure is the least rights restrictive approach. It was unclear from the response whether there are any other reasonably available less rights restrictive alternatives to prohibiting registered organisations from operating such funds in general. Accordingly, it was uncertain whether the measure constitutes a proportionate limitation on the right to freedom of association.

2.234         Based on the information provided and the above analysis, the committee was unable to conclude that the measure is a proportionate limitation on the right to freedom of association and the right to just and favourable conditions at work.

Prohibiting terms of industrial instruments requiring payments to election funds

2.235         Schedule 3 of the bill would amend the Fair Work Act to prohibit any term of a modern award, enterprise agreement or contract of employment permitting or requiring employee contributions to an election fund.[111]

Compatibility of the measure with the right to freedom of association and the right to just and favourable conditions at work

2.236         As set out above, the right to freedom of association includes the right to collectively bargain without unreasonable and disproportionate interference from the state. Prohibiting the inclusion of particular terms in an enterprise agreement interferes with the outcomes of the bargaining process. Accordingly, the initial analysis stated that the measure engages and limits the right to just and favourable conditions of work and the right to collectively bargain as an aspect of the right to freedom of association. The statement of compatibility acknowledges that the measure engages the right to negotiate terms and conditions of employment voluntarily.[112] However, the statement of compatibility appears to indicate that the limitation is permissible. 

2.237         The statement of compatibility identifies one objective of the measure as being to 'remove any legal or practical compulsion on an employee to contribute to election funds'.[113] This appears to be a description of what the measure does rather than articulating the pressing or substantial concern the measure addresses as required to constitute a legitimate objective for the purposes of international human rights law. The statement of compatibility identifies a second objective as addressing 'the possibility of contributions made in accordance with a relevant instrument being used to avoid the intent of the prohibition on organisations using their resources to favour a particular candidate'. While this could be capable of constituting a legitimate objective, limited explanation or reasoning is provided as to why this objective is important. Further, in relation to whether the measure is rationally connected (that is, effective to achieve) and proportionate to the stated objectives, the statement of compatibility provides no reasoning or evidence and only asserts that the measure 'is reasonable, necessary and proportionate'.[114]

2.238         The committee therefore requested the further advice of the minister as to:

• whether there is reasoning or evidence that establishes that the stated objective addresses a pressing or substantial concern or whether the proposed changes are otherwise aimed at achieving a legitimate objective;
• how the measure is effective to achieve (that is, rationally connected to) its stated objective; and
• whether the limitation is a reasonable and proportionate measure to achieve the stated objective (including whether the measure is the least rights restrictive way of achieving its stated objective). 

Minister's first response

2.239         The minister's first response provided the following information about the proposed amendments:

Current provisions

There are currently no provisions in the FW Act or RO Act that deal with terms of industrial instruments requiring or permitting employees to pay into election funds. This is despite the fact that section 190 of the RO Act prohibits an organisation from using its resources for the purposes of the election of a particular candidate. Because election funds are structurally separate from the organisation, they are not captured by this provision.

Changes proposed through the Bill

Schedule 3 of the Bill would amend section 194 of the FW Act to prohibit any term of an enterprise agreement or contract of employment requiring or permitting employee contributions for a regulated election purpose.

Schedule 3 would also amend Part 2-9 of the FW Act to provide that any term of a contract of employment requiring or permitting payments for a regulated election purpose will have no effect.

A 'regulated election purpose' is one that includes the purpose of funding, supporting or promoting the election of candidates for election to office in an industrial association.

2.240         The minister's response provided some further information about whether the limitation on human rights was permissible. In relation to whether the measure addresses a substantial or pressing concern, the minister's response explained:

Election funds are established to fund election campaigns for office within registered organisations and are regularly sourced from contributions from employees of such organisations. These funds are usually managed by one or more individuals who hold elected office within the organisation. They are not established in the interests of workers who are subject to the collective agreement but rather the interests of officials of the bargaining representative. The Royal Commission found that such arrangements unfairly disadvantage candidates who are not already in office and have been misused by officials controlling the funds where there are no contested elections. The Royal Commission also found a lack of oversight of election funds, with information about revenue and expenditure sometimes hidden, or not kept at all.

The amendments remove any legal or practical compulsion on employees to contribute to a particular election fund. They ensure employees have a choice about whether to contribute to the particular fund.

2.241         Based on this information, ensuring that non-incumbent candidates for elected union positions are not disadvantaged and that employees have a free choice about whether to contribute to a particular fund in the particular circumstances, would appear to constitute legitimate objectives for the purposes of international human rights law. The measures would also appear to be rationally connected to these objectives.

2.242         In relation to whether the measure is reasonable and proportionate, the minister's response states that registered organisation employees will still be able to make genuine contributions, voluntarily and independently of an industrial instrument. On balance, this would appear to be a proportionate limitation on bargaining outcomes.

2.243         The committee therefore noted that the measure appears to be compatible with the right to freedom of association and the right to just and favourable conditions of work.

Prohibiting any action with the intent to coerce a person or employer to pay amounts to a particular fund