Fair Work Amendments Introduced into Parliament

4th March 2014

The Australian Government has introduced into Parliament a raft of amendments it wants made to the Fair Work Act. The proposed amendments are largely drawn from recommendations of the panel that was appointed to review the Fair Work Act in 2012. The proposed changes are in some instances sensible but are unlikely to reduce complexity for small to medium enterprises. Notably, the most substantial changes proposed if accepted by the Australian Parliament, will mainly benefit large businesses.

The proposed amendments are as follows:

• A provision requiring employers to allow a reasonable opportunity for discussion with an employee when an extension to the period of unpaid parental leave is rejected;

• Annual leave loading on unused annual leave will not be payable on termination of employment unless a modern award provides for it;

• Paid and unpaid leave will not accrue whilst an employee is absent on accident compensation leave;

• Individual flexibility terms in modern awards and enterprise agreements requiring a written statement from employees explaining how a flexibility arrangement meets their genuine needs and how they are better off overall. Employers will not contravene the flexibility terms if at the time of entering into an individual arrangement, they reasonably believe that they have complied with the term of the award or enterprise agreement. Individual flexibility arrangements will be able to provide a benefit to the employee other than payment of money;

• Enterprise bargaining in new businesses and projects (greenfield sites) may be limited to 3 months and a Greenfield agreement approved even where the bargaining union has not agreed to it. Employers will be able to choose which union it wants to bargain with. The Fair Work Commission must approve the Greenfield agreement as long as the agreement considered on an overall basis, provides for pay and conditions consistent with the prevailing pay and conditions with the relevant industry for equivalent work;

• Transfers of employees between related entities will not be considered transfers of business where the employees request the transfer. This is intended to ensure internal recruitment opportunities between separate but related entities in a corporate structure do not require Fair Work Commission approval where the work performed is of a similar nature but the conditions are different;

• Right of entry permits and conditions to enter workplaces are being tightened up to ensure greater control over union visits to workplaces. The Fair Work Commission will have a power to issue ‘invitation permits’ to verify that employees have invited a union to attend the the workplace where there is no enterprise agreement in place.

The Fair Work Amendment Bill 2014 has been read a first time in the House of Representatives and will be debated in the next few weeks of this Parliamentary session.