Family and domestic violence (FDV) is a significant and complex societal and workplace issue in Australia. FDV disproportionally impacts women and children. On average one woman in Australia is killed every 11 days by a partner, and one in four women have experienced violence by a current or former intimate partner since the age of 15. The Coalition Senators agree that any form of family and domestic violence is unacceptable, abhorrent and continues to be a blight on Australian society. There is no tolerance or excuses for those who perpetrate such acts, and the long-term physical, emotional and psychological consequences for victim-survivors, and their families, can take years to remedy—if ever.
Following a decision by the Fair Work Commission (FWC) in July 2018 to vary Relevant Modern Awards relating to FDV, the former Coalition government (2013–2022) passed legislation – The Fair Work Amendment (Family and Domestic Violence Leave) Act 2018 – which gave provision for five days unpaid family and domestic violence leave (FDVL) for full-time and part-time employees in the National Employment Standards (NES). In passing this legislation, this reform supported the Decision of the FWC regarding award reliant employees. Critically, the reform recognised the pervasive manner of FDV that exists in Australia and acknowledged that FDV was increasingly becoming a workplace issue.
The former Coalition government introduced a range of significant measures to support family, domestic and sexual violence (FDSV) victims. The 2022–23 Budget provided $1.3 billion over six years from 2021–22 towards initiatives to reduce FDV and measures that address the full cycle of violence.
$222.6 million to prevent gendered violence;
$328.2 million over five years to extend and establish programs aimed at the early intervention and prevention of FDSV;
$480.1 million to fund programs to support women and their children who experience FDSV; and
$290.9 million to extend and expand programs that support the recovery of FDSV victim survivors.
These initiatives built on those previously introduced by the former Coalition government, which included:
$164.8 million for financial assistance and support for women affected by FDV;
since 2015, $34.6 million provided to the states and territories to assist women and their children to stay in their home by improving home security arrangements; and
funding the Safe Places Emergency Accommodation Program that delivered new or expanded emergency and crisis accommodation facilities for women and children experiencing FDV.
On 12 April 2021, the Australian Council of Trade Unions (ACTU) petitioned the FWC requesting that it review the FDV provisions. Shortly thereafter the FWC announced that as part of its four yearly reviews of modern awards, the FWC would commence its review of FDVL. It should be remembered that the remit of the FWC was to determine ‘whether a modern award provides a fair and relevant safety net of terms and conditions and whether a proposed variation is necessary for the award to achieve the modern awards objective’.
On 16 May 2022, the FWC published its provisional views on the ACTU application to vary modern awards to include paid FDVL. The FWC ‘rejected’ the ACTU claim for an additional five days of unpaid FDVL (on a per occasion basis) and formed the opinion that paid FDVL ‘not apply to casuals.’
The Full Bench of the FWC outlined in its Decision its view that a paid FDVL model should have the following characteristics:
(a)
Full time employees and, on a pro-rata basis, part time employees should be entitled to 10 days paid FDV leave per year.
(b)
The entitlement to 10 days paid leave per year should accrue progressively across the year in the same way that personal/carer’s leave accrues under the NES, with accrual occurring according to the methodology articulated by the High Court in Mondelez Australia Pty Ltd v AMWU & Ors. The entitlement should accumulate from year to year, but subject to a ‘cap’ whereby the total accrual does not exceed 10 days at any time.
(c)
The FDVL entitlement should be accessible in advance of an entitlement to such leave accruing, by agreement between an employer and employee.
(d)
The FDVL entitlement should operate on the basis that it is paid at the employee’s ‘base rate of pay’ as defined in section 16 of the Fair Work Act 2009 (FW Act).
(e)
The definition of ‘family and domestic violence’ should be in the same terms as the definition in section 106B(2) of the FW Act (and not extend to FDV perpetrated by a member of the employee’s household who is not related to the employee).
(f)
In all other relevant respects, the model FDVL term should reflect the terms of section 106B.
As a result of the Commonwealth Government (Government) introducing legislation on 28 July 2022 to give effect to paid FDVL, the FWC did not propose to take any further steps relating to the review of FDVL, as it had already vacated its direction in its FDVL review after considering correspondence from the Minister regarding the proposed introduction of FDVL legislation into the Federal Parliament.
Where the Government’s model differs from the FWC model
The Government’s proposed legislation departs from the FWC model in several ways. These include:
(a)
It provides ten days of paid FDVL in a 12-month period for casual employees.
(b)
In relation to the accrual of leave, employees would gain 10 days of paid FDVL from the commencement date of 1 February 2023, rather than having it accrue like other leave entitlements.
(c)
It provides for employees to access paid FDVL at their full rate of pay for the hours they would have worked had they not taken the leave.
(d)
It extends the definition of FDV to include conduct of a current or former intimate partner of an employee, or a member of an employee’s household.
(e)
Extends the full paid entitlement to all employees when the International Labour Organisation Convention (No. 190) concerning Violence and Harassment comes into force for Australia.
The Coalition Senators note the FWC provisional model and that the proposed government legislation has gone beyond the provisional model of the FWC Decision. The Liberal and National Parties respect the integrity of the fair and balanced process the FWC undertook in examining the evidence in reaching its decision. The Coalition Senators note amongst other departures from the Decision, the Government’s proposed legislation seeks to alter the definition of ‘casual’ work and the widely accepted entitlements associated with that employment type in lieu of paid leave.
The Coalition Senators note that most businesses are supportive of the provision of paid FDVL. Indeed, many businesses, particularly larger organisations, have already included such provisions over a gradual period before and since the 2018 introduction of five days unpaid FDVL. The issue is who pays and whether the employer could pay with reimbursement from a third-party government agency in much the same way that paid parental leave is administered.
Casual workers
The Government’s inclusion of casual workers being given access to FDVL could have potential ramifications which the Government has not adequately addressed. The Coalition Senators note the concern, particularly from small businesses, of the impact such a paid entitlement will have as they have a lesser capacity to absorb additional costs than larger organisations. As casual workers do not have access to any other leave entitlement, but are instead paid a casual loading, the Government needs to outline how much this will cost small and family businesses and consider whether government assistance is needed for small businesses who are disproportionately affected. Furthermore, the introduction of this paid leave scheme could have a significant administrative burden on some small businesses who employ large numbers of casuals who may struggle to absorb the costs. The FWC acknowledged that including paid FDVL into the modern award system will ‘increase the utilisation of such leave’ and therefore there would likely ‘be some increase in unplanned employee absences.
The Coalition Senators note the apprehension from some stakeholders who provided evidence that the potential economic cost, particularly for small to medium businesses, has not been conclusively established. Intriguingly, given the Government ignored several aspects of the FWC Decision, it then relied on and accepted the cost modelling presented to the FWC by academic experts commissioned by the ACTU as part of its claim. Undeniably there will be an impact on small businesses and this sector will be disproportionately affected. The Coalition Senators note several stakeholders expressed disquiet regarding the lack of quantitative modelling on the cost impact. Indeed, the modelling the ACTU commissioned from Professor Alan Duncan did not extend to casuals.
They also argued that the modelling referred to an aggregated cost to business rather than recognised appreciation of the potential disproportionate cost to individual businesses.
The Coalition Senators note the department did not undertake specific economic analysis regarding this legislation but welcomes the Department of Employment and Workplace Relations’ (department) intent to explore ‘ways we can collect more evidence once the leave is implemented as a review mechanism.’ The Coalition Senators’ note the views of the Council of Small Business Organisations Australia (COSBOA) in its submission to the committee for a ‘12-month review, following the implementation of any new provision which would seek both qualitative and quantitative research’.
The Coalition Senators also note that many stakeholders are of the opinion that small businesses will be significantly more affected then medium to large businesses because unlike the latter, small businesses hire more casual employees and some sectors such as food and hospitality employ greater numbers of casuals. In its submission to the committee’s inquiry, COSBOA noted the challenges and complexities faced by small businesses in implementing a scheme for casual employees:
…businesses will be required to establish whether a casual worker is rostered on, as on many occasions, this can be less formal with no roster in place. The time poor employer working in their business may ask an employee to work a particular day at short notice or allow a worker to select their preferred work times. Therefore, whether an employee was or was not working will be complicated compared to permanent work, which is regular and systematic, something that should be avoided for a victim of domestic violence. Embedding this type of leave for casuals will not assist in addressing the problem and will add complexity to a workplace.
The Coalition Senators note that the FWC Decision understood the economic imposts the ACTU claim would have on businesses, particularly for sole traders and small business owners. In its Decision, the Full Bench observed:
Compared to the ACTU claim, the provisional model term provides better alignment with existing NES entitlements and will have less impact on business in terms of employment costs and the regulatory burden. The accrual arrangements in the provisional model term will have the effect of operating as a phasing-in mechanism for the paid FDV leave entitlement for the first 12 months after the entitlement takes effect.
The Coalition Senators note the FWC Decision and therefore recognise that paid FDVL for casual employees, including leave utilisation being available ‘up front,’ was not recommended by the FWC because the NES does not extend paid leave to casuals. The FW Act provides no precedent nor a model for a workable scheme for the provision of paid leave of any type to casual employees. The Coalition Senators note it was pointed out in various submissions, both to the FWC review and the committee’s inquiry, that there are operational uncertainties in extending paid FDVL to casuals. Indeed, the ACTU’s claim to the FWC acknowledged these difficulties:
The ACTU accepts that there are some operational challenges associated with extending paid FDV leave to casuals, including in relation to those casual employees whose hours of work are genuinely uncertain.
The Coalition Senators note in this respect the Government chose to ignore the legitimate concerns raised by the FWC and other business stakeholders, and instead, decided to align with the ACTU claim. Similarly, the Coalition Senators note the Government chose to deviate from the independent umpire with respect to allowing employees access to paid FDVL at their full rate of pay. The Coalition Senators note business stakeholders gave submissions to the FWC review and the Committee’s inquiry, arguing against the full rate of pay and noting the inconsistencies with the existing NEC provisions. Local Government NSW stressed that ‘any paid FDVL entitlement should be payable at the employee’s base rate of pay for the employee’s ordinary hours of work’.
The Coalition Senators note during evidence to the committee, business advocates such as COSBOA articulated concerns around the determination of using the paid FDVL and expressed support for an external agency such as Centrelink to make the determination on behalf of the small business owner. The Coalition Senators note this concept would operate in a similar fashion to what occurs with the paid parental leave, a system already well known to small business operators, and where ‘they could have a determination and a payment that comes through an external government agency.’ The Australian Hairdressing Council expressed a similar view that Centrelink might act as the agency where employees can go to access paid FDVL instead of the employer.
The Coalition Senators note some small business organisations believe a similar scheme would remove uncertainty for small business owners having to determine what a casual employee was going to earn on the day they were to work and what that rate was meant to be. The Coalition Senators note a complex paid leave entitlement could lead to an unintended underpayment, resulting in further liabilities for small business owners. The Coalition Senators note the Australian Industry Group (AIG) supports a paid FDVL scheme that is ‘publicly funded … so that the cost of the entitlement is not borne by individual employers’.
The Coalition Senators note that no Regulatory Impact Statement was prepared in relation to this proposed legislation and are aware of the views of AIG that ‘such an approach overlooks the major differences between the Bill and the entitlement contemplated by the Commission’.
If the Government is to include casual workers as being part of the FDVL entitlement, it is essential that further details are provided about how much this will cost small and medium business, how the scheme will operate in detail, and how much financial assistance will be required for small and medium businesses.
Reporting obligations
The Coalition Senators note the proposed legislation is silent on the reporting obligations of employers. The Coalition Senators note this ambiguity only creates further uncertainty and guess work for small business operators, who are already experiencing a challenging economic and labour shortage environment. In this regard, sole traders and small business owners may be in a family-owned small business or partnership, where one partner is the FDV perpetrator, and the other is the victim. According to COSBOA (in its November 2021 submission to the FWC) 35 per cent of business owners were female and accessing paid FDVL will not assist them if sole-trader or micro businessperson is the primary income maker.
Perpetrators
The Coalition Senators also note the concern around the ambiguity of the new provision with respect to perpetrators of FDV accessing the new entitlement. During the committee hearings, department officials indicated that the provision for the entitlement was for those ‘experiencing’ FDV, nevertheless, deliberately vague, or not, the government must clarify its intent within the actual legislation regarding perpetrators of FDV. The Coalition Senators do not support including paid FDVL for perpetrators, and instead believe that other than facing the full extent of the law, there are existing provisions, for example, counselling, perpetrators of FDV can access to amend and reform their behaviour. It is important that the legislation is amended to clarify this entitlement is not available to perpetrators.
Recommendations
Coalition Senators recognise the pervasive impact of FDV and support the introduction of paid FDVL. Moreover, they understand the complexity of introducing paid FDVL will have on businesses, particularly the small and medium business sector.
Given the Government’s legislation departs significantly from the decision of the FWC in relation to FDVL, the Government needs to urgently clarify how the additional requirements will affect businesses, particularly small and family business.
Recommendation
Coalition Senators recommend:
the Government provide greater details about the impact of the FDVL model on small and family businesses, particularly regarding casual workers, and provide additional assistance to ensure these businesses are not adversely affected by the administration of the scheme or worse off financially;
the legislation be amended to clarify the reporting obligations for employers with respect to paid FDVL;
the legislation be amended to ensure perpetrators of FDV cannot access the proposed new paid entitlement;
a 12-month review, following the implementation of the legislation, which would seek both qualitative and quantitative research on the impact for small businesses; and
a 12-month review, following the implementation of the legislation, which would assess the impact on sole business.
The Coalition Senators urge the Government to continue to build on the work of the former Coalition government in implementing strategies to prevent FDV and support victim survivors of FDV and call on the Government to do more to limit the impacts this legislation will have on sole traders and small businesses.
Senator Matt O'SullivanSenator Kerrynne Liddle
Deputy ChairMember
Liberal Senator for Western AustraliaLiberal Senator for South Australia