Hicksons on IR laws

The following is an opinion piece by Rod Cameron of Hicksons Lawyers. Any claims or legal points made in the piece have not been independently verified by IT News.

Changes to Australia’s industrial relations laws implemented by the Workplace Relations Amendment (WorkChoices) Act start this week, and only time will tell whether the federal government’s new system will deliver the productivity and efficiency improvements to business as promised.

WorkChoices brings most Australian employers into the federal system, provided that they are constitutional corporations.

The new system also brings with it great transitional complexities as companies and their lawyers plough through thousands of pages of legislation, regulations and explanatory memorandum. However, once companies complete the transition there will be increased flexibility and simplicity.

For companies and their employees there is no avoiding the WorkChoices rollout, and the best way forward is to embrace it.

There are a number of key areas that employers should look at.

First is to establish Workplace Agreements, individual or collective. Companies wishing to deal with employees individually should use Australian Workplace Agreements. Companies wishing to deal with one or more groups of employees, employers should use Employee Collective Agreements (non-union) or Union Collective Agreements. Companies establishing new business operations could also use Employer or Union Green-fields Agreements.

WorkChoices presents an opportunity for companies to look at their overall employment conditions and to re-assess what they do regarding workplace relations as a whole. Employers may be able to put in a more consistent and fairer structure across the board with benefits that better attract and retain candidates in a market beset by skills shortages.

The new system also means that employers and employees don’t have to worry about being dragged into an Industrial Commission because they want an agreement which needs to be certified. It’s much simpler.

Second, employers have to make sure there is no “prohibited content” in their Workplace Agreements. These include things like compelling union involvement in negotiations, locking out unions from negotiations, restrictions on the use of independent contractors and providing a remedy for unfair dismissal or for union right of entry. Where Workplace Agreements contain prohibited content the prohibited clauses are unenforceable and the employer faces civil penalties of up to $6,600 per offence.

Under WorkChoices, some basic terms and conditions will be subject to the Australian Fair Pay and Condition Standard (AFPCS). These will be minimum safety net standards.

Third, companies should expect that over time individual employees will be more active in negotiating, even appointing bargaining agents. Traditionally individual employees have played little part in negotiating for their own conditions of employment. The common scenario has been for an employee to apply for a job and then accept it or not, chiefly based on pay.

WorkChoices will likely see a gradual cultural shift in the way employers and employees conduct their business together. In time, employees will be expected to bargain for their terms and conditions, eg working hours, penalty rates, leave arrangements, sick leave etc.

Finally, when terminating employment companies should recognise that while there is reduced unfair dismissal risk because of exclusion for companies with 100 or less employees, because of increase in the qualifying period from three months to six months and because of exemption in respect of “genuine operational reasons”, they are still subject to unlawful dismissal rules.

Unlawful dismissal includes dismissing employees because of their age, race, colour religion, family responsibilities or because of their trade union membership or activities outside work hours, etc.

Unlike unfair dismissal claims that are heard in the Industrial Relations Commission, where the onus is on the employee to prove their case, unlawful dismissal claims are heard in the Federal Court system and the onus is reversed requiring the employer to prove that the dismissal was not unlawful.

Employers involved in unfair dismissal claims seeking to rely on the defence that a dismissal was for “genuine operational reasons” will need to make sure they can prove that the dismissal was due to genuine economic, technological, structural or similar reasons relating to the employer’s business.

For companies WorkChoices will open up a substantially simpler environment for making more flexible workplace agreements in the future, however, the transitional arrangements will prove quite complex in the short term.