Second wave of industrial relations reform tabled and a third wave on its way
The Albanese Government has set in motion more employment law changes, following 2022's Secure Jobs Better Pay Act and Respect at Work Act. On 29 March 2023, Workplace Relations Minister Tony Burke introduced into Parliament the Fair Work Legislation Amendment (Protecting Worker Entitlements) Bill 2023 (PWE Bill). The Bill proposes major changes to the Fair Work Act, including:
- clarifying that the Fair Work Act protections apply to all migrant workers
- increasing the flexible unpaid parental leave entitlement
- embedding superannuation contribution requirements within the National Employment Standards (NES)
- providing greater certainty as to the operation of workplace determinations, and
- streamlining the employee authorised deduction process.
In this article, we discuss the details of these changes and their anticipated impact on employers.
Increased protection for migrant workers
The PWE Bill proposes a new section in the Fair Work Act to disregard the effect that the Migration Act 1958 (Cth) (Migration Act) has on the validity of an employment agreement or contract for services. This provision will cover employees and independent contractors.
A Migrant Taskforce in 2019 found that there was uncertainty about whether migrant workers could enforce workers' rights under the Fair Work Act, in particular if the worker had breached their visa conditions. The new section gives clarity that a breach of visa conditions does not affect an employment agreement. This will mean that an employment agreement does not become invalid because the employee no longer has rights to work in Australia, or they have breached their visa conditions by working more hours than allowed, or they are no longer allowed to remain in Australia at all.
However, the new section will not vary the effect of the Migration Act, so loss of work rights and the consequences of non-compliance will still apply to the worker.
Implications for employers
For employers, this means that even if a temporary migrant worker has breached their visa conditions or no longer has work rights, they can still seek to recover unpaid wages or make claims under the Fair Work Act, particularly for unfair dismissal or adverse action.
It also makes it clearer for employers that to the extent of any inconsistency between the Migration Act or visa conditions and the Fair Work Act, the Fair Work Act prevails. For example, a visa condition that an employee must be employed for a fixed term of three years would be of no effect when the two-year limitation on fixed term contracts comes into effect in December 2023.
It is uncertain to what extent this proposed new section will mean that an employer cannot rely on a breach of working rights or other visa conditions as grounds for ending the employment relationship. We anticipate that this issue will be addressed as the Bill is discussed in Parliament before it is passed.
Increased flexibility of unpaid parental leave entitlement
The PWE Bill proposes to amend the provisions relating to unpaid parental leave (UPL) in the Fair Work Act to align with the amendments to the Paid Parental Leave Act 2010 (Cth) (PPL Act) and give employees greater flexibility in how they utilise their entitlement to UPL. The purpose is to strengthen access to UPL and help families share work and caring responsibilities.
The proposed changes would:
- allow parents to take up to 20 weeks of their 12-month unpaid parental leave entitlement flexibly (up from six weeks)
- enable pregnant employees to access some of the 20-week flexible entitlement up to six weeks before the expected date of birth of their child
- remove restrictions that prevent employees who are married or in a de facto relationship from taking more than eight weeks of unpaid parental leave at the same time
- allow both parents to take up to 12 months’ unpaid parental leave, regardless of the amount of leave the other parent takes, and
- allow both parents to request an extension of up to 12 months, without impacting the amount of leave available to the other parent.
Implications for employers
For employers, these changes will mean an increase in the number of employees who are entitled to take unpaid parental leave, and extensions to that leave. However, given that the changes only provide for additional unpaid leave, we anticipate that it is unlikely to lead to a flood of additional requests for UPL.
Further, in our experience, these changes bring the Fair Work Act entitlements in line with best practice being adopted in companies around Australia.
Superannuation in the National Employment Standards (NES)
The PWE Bill proposes to include the employer obligation to make superannuation contributions part of the NES. The rules, requirements and exemptions under the Superannuation Guarantee Charge Act 1992 (Cth) will be adopted into the NES.
By including the superannuation obligations in the NES, employers who do not make the minimum contributions will be in breach of the Fair Work Act and risk civil penalties being imposed.
As a result of the proposed change, all employees will be able to commence proceedings in the Federal Courts to recover unpaid super. Currently only employees covered by a modern award or enterprise agreement which provides for superannuation contributions can bring proceedings personally. These changes would be in addition to the powers of the Australian Taxation Office to commence proceedings to recover unpaid superannuation.
For employers, this means that there will be additional penalties for failure to make super contributions, and additional avenues to defend claims of such failures.
Employee authorised deductions
The PWE Bill proposes to allow an employer and employee to enter into a written agreement authorising ongoing deductions of varying amounts. Currently a new written agreement must be entered into each time the amount varies, which places an administrative burden on employers. The other rules regarding deductions will remain the same ─ they must be for the benefit of the employee, or be reasonable having respect to the provision of goods or services by the employer, or to recover costs directly incurred by the employer due to use of employer property by an employee.
Workplace determinations
The PWE Bill proposes to add a new section that clarifies that when a workplace determination is made (for example where bargaining parties have no reasonable prospects of reaching an agreement) the relevant earlier enterprise agreement will cease to have effect. This provides clarity where there was previously uncertainty, though in our experience workplace determinations are not often made.
A third wave still to come...
Additionally, the Albanese Government has announced a third wave of employment law changes, expected in the second half of 2023. These further changes will be intended to address "employee-like" forms of work (covering gig economy workers), and "same job same pay".
We anticipate these changes to be the most controversial, and most employee-friendly on the Albanese Government's agenda. It remains to be seen whether this means they will be more difficult to pass through Parliament than the changes so far. Stay tuned for further updates from Lander & Rogers' Workplace Relations & Safety group.
Photo via Unsplash.
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