here we go again ...Life After WorkChoices

2. here we go again...Life After WorkChoices Joe Catanzariti, Partner 8 November 2008

3. Introduction • The building blocks of the new IR system in life after WorkChoices • Good faith bargaining • Award modernisation • Fair Work Australia • Unfair Dismissal

4. Good faith bargaining • Collective agreement making is at the heart of the Federal Government's Forward with Fairness industrial relations reforms • Major reform - the introduction of a federal legislated obligation for parties at a workplace to bargain in good faith

5. Good faith bargaining • The focus on enterprise bargaining: • for "the development of fair and flexible employment arrangements that are tailored to suit the needs of an individual business and the needs of employees." • Forward with Fairness: Labor's plan for fairer and more productive Australian workplaces, April 2007 • Good faith bargaining policy rationale: to improve workplace relations leading to more productive business outcomes

6. Good faith bargaining • Good faith bargaining prior to Forward with Fairness • In commercial dealings: in the context of contractual performance and an implied duty of good faith has also been found in some jurisdictions in relation to employment relationships. • Industrial Relations Act 1988 (Cth) (the "IR Act"). Section 170QK • In some States such as WA, QLD, SA and NSW

7. Good faith bargaining • Good faith bargaining will involve: • attending and participating in meetings at reasonable times; • disclosing relevant information in a timely manner, subject to appropriate protection for commercial in confidence information; • responding to proposals made by a party in a timely fashion • giving genuine consideration to the proposals of the other parties and providing reasons for the responses; and • refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining

8. Good faith bargaining • The role of Fair Work Australia • Good faith bargaining orders • Fair Work Australia will be able to make bargaining orders when it appears that bargaining representatives are not bargaining in good faith. • Majority of employees • The employer will be required to bargain collectively if Fair Work Australia determine there is a majority employee support for pursuing an enterprise agreement

9. Good faith bargaining • Other issues • Representation • Both employers and employees will be entitled to choose a representative to represent their interests in negotiations • Industrial action will not be protected in the following instances: • where it is taken during the life of an agreement, • where it is taken in support of an industry wide agreement or • where it is taken outside the good faith bargaining process (whether it is imposed by FWA or not).

10. Award modernisation • Modern awards and the National Employment Standards form the ALP's "safety net" for employees • Award modernisation includes reviewing and updating the 10 minimum award conditions

11. Award modernisation • The first award modernisation request - 28 March 2008 • The Minister requested the Australian Industrial Relations Commission (AIRC) to: • Identify a list of priority industries or occupations for award modernisation • Develop a model award flexibility clause • Develop a timetable for completing the award modernisation process

12. The 10 minimum award entitlements Minimum wages Type of work performed Arrangements for when work performed Overtime rates Penalty rates Minimum annualised wage or salary arrangements Allowances Leave Superannuation Consultation, representation and dispute resolution Award modernisation

13. List of priority industries Coal mining Higher Education Hospitality Metal and Associated Industries Mining Private Sector Clerical Racing Rail Retail Security Textile, Clothing and Footwear Vehicle manufacturing Award modernisation

14. Award modernisation • Proposed timetable • Exposure draft of modern awards released - 12 September 2008 • Final priority awards - 19 December 2008 • Second stage of award modernisation process - 10 Oct 2008 - 3 Apr 2009 • Third stage of award modernisation process - 2 Mar - 4 Sept 2009 • Final stage of the award modernisation process - 6 July - 4 Dec 2009

15. Award modernisation • Model flexibility clause • The purpose of the clause: • To permit reduction in one or more minimum entitlements as part of agreement to meet genuine individual needs of an employer without disadvantaging the individual employee

16. Award modernisation • Model flexibility clause • The award terms that might be included in the scope of the clause are: • Arrangements for when work is performed • Overtime rates • Penalty rates • Allowances • Leave loading • The test for disadvantage

17. Award modernisation • Modern awards - the role of Fair Work Australia • FWA will review modern awards every four years • The Minimum Wages Panel within FWA will review minimum wages every year taking into account: • performance and competitiveness of the economy • promoting social inclusion • living standards • minimum wages for junior employees, those covered by training arrangements and employees with disabilities.

18. Fair Work Australia • Fair Work Australia will be a: • "one stop shop, to provide practical information, advice and assistance, to settle grievances and ensure compliance with Labor's workplace laws"

19. Fair Work Australia • Fair Work Australia will replace the following bodies • The Australian Industrial Relations Commission • The Australian Industrial Registry • The Australian Fair Pay Commission • The Australian Fair Pay Commission Secretariat • The Workplace Authority • The Workplace Ombudsman • The Australian Building and Construction Commission (from 1 February 2010)

20. Fair Work Australia • Features and functions • Fair Work Australia's tribunal functions • Approval of enterprise agreements • Award review and variation • Good faith bargaining orders • Unfair dismissal • Mediation and dispute resolution • Broad powers to investigate

21. Fair Work Australia • Features and functions • Minimum wages panel • Non tribunal functions • Fair Work Australia Inspectorate • Replaces the Workplace Ombudsman • Fair Work Inspectors will monitor compliance with legislation • Fair Work Divisions of the Federal Court and Federal Magistrate's Court will hear and determine matters that arise under the new laws

22. Fair Work Australia • Operation of Fair Work Australia - July 2009 • Fair Work Australia will commence operation as early as July 2009 - the same time that enterprise bargaining arrangements and unfair dismissal laws are to commence. • Fair Work Australia will operate concurrently with the AIRC until the award modernisation process is completed.

23. Unfair Dismissal • The position under WorkChoices • Employees dismissed by employers with 100 workers or less were not entitled to challenge dismissal on the basis that it was harsh, unjust or unfair

24. Unfair Dismissal • The reform • Employees of small businesses (under 15 employees) will need to be employed for 12 months before they can bring an unfair dismissal claim. • For all other employees, a 6 months qualifying period will apply. • Small business employers will not be liable for unfair dismissals if they can demonstrate compliance with the new Fair Dismissal Code.

25. Unfair Dismissal • The Fair Dismissal Code for Small Businesses • Compliance with the “Fair Dismissal Code allows the dismissal to be deemed ‘fair’ and small business employers will not be liable for an unfair dismissal claim

26. Unfair Dismissal • The Fair Dismissal Code • The procedure for small business employers : • The employer must give the employee a valid reason as to why the employee is at risk of being dismissed. The reason must be based on the employee’s performance or capacity to do the job. • The employer must give the employee a reasonable opportunity to rectify the problem.

27. Unfair Dismissal • The role of Fair Work Australia • The Tribunal arm of FWA will be responsible for investigating unfair dismissal claims • This process will involve FWA employing informal fact-finding mechanisms, including discussing the issues in informal conferences with the employer and employees.

28. Unfair Dismissal • The role of Fair Work Australia • Decisions will be made without the need for a public hearing when determined by the Fair Work Review Panel. • Public hearings and legal representation will only be allowed when an unfair dismissal case involves 'complex issues'. • Reinstatement will be the primary remedy for successful unfair dismissal claims. Where this is not appropriate, compensation capped at six months pay will also be available.

29. Conclusion • This period of flux in industrial relations will perhaps only show abatement as we approach the commencement of the entire new industrial relations system in January 2010. • We must wait to see how key elements the new industrial relations system will work in practice in the coming year So well may we lament, here we go again.