By Charles Power
This week, the Federal Government will commence its tri-partite meetings with employers and unions to discuss changes to industrial relations laws. The meetings have been initiated by the Government in response to the COVID-19 pandemic, and have the support of peak industry groups and unions.
Some of the changes that are likely to be discussed at this forum are examined below.
It is likely the Government will support amending the National Employment Standards to create a universal right for casuals to request conversion to permanent employment after 12 months of regular casual employment. The terms of this provision are likely to follow the model casual conversion clause that has been inserted into most modern awards over recent years.
The change will also most likely include a definition of casual employment. I expect it will adopt the definition of casual employment developed by the Federal Court in the recent Workpac rulings, namely that a person is a casual when there is an absence of a firm advance commitment as to the duration of the employee’s employment or the days or hours the employee will work. If neither the employer nor the employee give this commitment, the person is a casual.
The Government is also likely to address the defect in the Fair Work Regulations identified in the most recent Workpac ruling, so that an employer who paid a casual loading to a putative casual can rely on that payment to offset claims for paid leave, should the employee be found to be entitled to that benefit.
It is likely that the current 4-year maximum term for a greenfields enterprise agreement will be increased to better align with the life of longer-term building and construction projects or similar types of major projects.
It is also likely the Government will propose changes to Fair Work Act 2009 (Cth) (FW Act) provisions dealing with the better off overall test, to make it easier to pass the test. There is little indication as to what the Government will propose. However, I expect it will seek to make it easier to include provision in an enterprise agreement for loaded ordinary hourly rates higher than the relevant modern award to compensate for lower penalty rates. In the Hart v Coles Supermarkets (2016) Full Bench decision, the Fair Work Commission made it clear that the rate had to be struck so that it did not disadvantage employees who worked primarily at times that attracted lower penalty rates under the agreement as compared with the award.
Compliance and enforcement
The Federal Government has signalled in a discussion paper a willingness to examine a range of changes, including:
- expansion of compliance tools available to the Fair Work Ombudsman, including broader use of compliance notices and infringement notices, increase in fines specified in infringement notice and penalties for non-compliance with an enforceable undertakings;
- a FW Act prohibition on employers advertising non-compliant pay rates;
- expansion of the small claims jurisdiction in the federal courts, and requirement for underpayment disputes to be conciliated first by the Fair Work Commission;
- increased civil penalties for FW Act contraventions;
- expansion of sham contracting and vulnerable worker protections in the FW Act; and
- criminal penalties for wages underpayment that was part of a systematic pattern of dishonest conduct.