The Fair Work Act and Your Station CBAA Conference, Brisbane 20 November 2009 Michael Pegg

Managers manage Organisational strategy, management and values Organisational performance Employee Manager

Outline 1.Contracts 2.State and federal systems 3.National Employment Standards 4.Awards & Agreements 5.Unfair dismissal and other adverse actions

Common Law Contract of Employment Intent Offer of work Acceptance Consideration ($) in exchange for work Employee vs Volunteer

Rights and Responsibilities EmployerEmployee Provide workObediance - Work as directed PayCompetence & care Safe workplaceWork safely Good & considerateGood faith – Honesty, loyalty & cooperation

State and Federal Systems Historically complex mix of systems Got more complex in 2006 – “Corporations power” –Non profit community organisations –Trading? Incorporated? Moving to national system ?

State Referrals In 1996, Victoria referred some of its powers to make laws about IR to the federal parliament –Consequence is no state system –Avoid jurisdictional complications because corporation status not relevant Qld, NSW, Tas, and SA are referring in 2010, subject to Senate passage of federal legislation WA has decided not to refer

State Referrals LocationConstitutional trading corporation Not Constitutional trading corporation ACT, NT, VicFederal system NSW, Qld, SA & TasFederal systemState system 2009 Federal system from 1 January 2010; transitional arrangements WAFederal systemState system

Key elements of Fair Work National Employment Standards (NES) Modern awards Agreements Termination of employment & adverse actions

The Hierarchy of Conditions NES Modern award ConditionsModern award Pay Collective Agreement Contract of employment HR Policies +/

National Employment Standards (NES) Basic entitlements Take effect 1 January 2010 Enshrined in legislation and override awards and agreements (except some pre-reform agreements)

NES – existing federal standards Max working hours – 38 hour week plus reasonable additional hours Annual leave Personal/carer’s & compassionate leave Parental leave Plus new provisions…

NES – new provisions Public holidays Long service leave Flexible work arrangements for parents of pre- school children Community service leave (emergency, jury) Notice of Termination & Redundancy pay (>15 employees) Fair Work Information Statement

NES – Selected issues (1) Annual leave –Cashing out (if allowed by award/agreement) provided 4 weeks balance maintained –Pro rata accrual after 1 month Personal/Carer’s leave –10 days personal/carer’s, plus 2 days per occasion compassionate –Modern awards may provide cashing out provided 15 days balance maintained

NES – Selected issues (2) Parental leave –12 months plus right to request further 12 months unpaid leave Flexibility requests –Includes pre-school children & disabled children under 18 yo –Written request –21 days to respond in writing - reasonable business grounds

NES – Selected issues (3) Community service leave –Emergency management activity Notice, evidence Unpaid –Jury service Based on common award provisions Paid (less jury pay) Up to 10 days

Award Modernisation Fewer awards, industry-based and common rule Operate by common rule from 1 January 2010 Transitional provisions Most federal system employees covered by an award (even if previously award free) Some exceptions eg if paid above $108,300 (indexed)

Content of Modern Awards Build on NES, with industry specific standards, Plus a range of other items such as: –Wages, allowances and penalty rates –Types of employment –Superannuation –Industry specific arrangements for working hours Flexibility arrangements on better off basis Consultation, representation and disputes

Which Modern Awards? Determined case by case – Possibilities (Subject to finalisation by end of 2009): Clerical –Office staff and managers Broadcasting and Recorded Entertainment?? –Technicians, engineers?? Commercial Sales?? –Sponsorship?? (note limits on commissions) Miscellaneous

Agreements “Better Off Overall Test”(BOOT) Most prohibited content no longer prohibited Individual flexibility and consultation on change Notification time - 14 days to advise representational rights, prior to 7 day approval period Good faith bargaining Multiple business agreements and “low paid bargaining stream”

BOOT BOOT – Employees better off overall compared to a “reference instrument” Reference Instrument –Award that applies –Relevant state long service leave legislation –In conjunction with NES

Bargaining Options Rely on award –May be easiest option if limited resources –Modernisation –Recruitment & Retention Common law contracts or policies for over award conditions –Easier than collective bargaining Collective Bargaining

Unfair Dismissal Remedy for harsh, unjust or unreasonable termination of employment Remedies include:  Reinstatement  Compensation of up to 26 weeks pay Historically, about 90% of claims are settled informally

Unfair Dismissal - Exemptions From 1 July 2009, all federal employees able to lodge claims except:  Non-award employees paid >$100,000 (2007 dollars indexed);  Employees with less than 6 months service, provided that for a small employer (fewer than 15 EFT employees until 1 January 2011, then just 15 employees), 12 months service is required ;  Other standard exemptions eg short term casuals  Genuine redundancy

Genuine Redundancy Job is no longer required to be done by anyone because of changes in operational requirements Obligations to consult, under award or enterprise agreement, have been complied with It was not reasonable to redeploy – positive obligation to explore options

Process – Unfair Dismissal Federal claims need to be lodged within 14 days of dismissal FWA emphasis on speedy and informal resolution with >80% settled at conciliation Employer may be represented by employer organisation (eg by Jobs Australia), but private lawyers need to seek leave to appear

Natural Justice State allegations – valid reason Fair investigation Opportunity to respond/explain Consequences made clear if not resolved Right to representation (particularly if termination considered) Even if considering summary dismissal – natural justice first

Outcomes of Disciplinary Process Not determined until after process No further action – best case scenario Informal warning Written warning (with review period if performance issue) Termination with notice, or without notice if serious misconduct –worst case scenario –indicator of possible problem with recruitment, selection, training, performance management or organisational culture

Alternative Remedies Unlawful termination - Prohibited reasons such as: –Temporary absence due to illness or injury – Race, sex, political beliefs etc – Failure to provide required notice Onus on employer to rebut claim General protection against adverse action, including prior to termination Also - Anti- discrimination, breach of contract

Adverse Actions Remedy from Fair Work Australia if subject to any adverse action on prohibited (ie discriminatory) grounds Includes adverse actions such as –Refusal of training opportunities –Changes in hours –Refused promotion Similar to existing anti-discrimination laws, but potentially faster remedies

Managing Change Employer Rights to determine how job is done and by whom to decide how to run their organisation Constrained by Industrial and other legislation Employee responses Management strategy

Key Elements of Process Information Consultation – before finalising decisions about structure –Modern award requirement and –Evidence based decision making Explore alternatives to termination, such as reduced hours, retraining, redeployment Fair process for selecting retrenchments Appropriate support for affected employees

Contact Jobs Australia Michael Pegg –Phone:(03) –Phone:(1800) –Fax:(03)