Workplace Relations Changes
15 July 09
The changes to Workplace Relations under the Labor Government's Fair Work Act 2009 will impact you and your business. The introduction of the new Act is a transitionary one - some items are being introduced from 1 July 2009 with others being introduced from1 January 2010. Below is a summary of the changes and what will be required by you in terms of procedural and documentary changes to comply with the new system:
From 1 July 2009:
The definition of a 'Small Business' has changed. Under Howard's WorkChoices, a business with less than 100 employees was considered a small business. This has now been reduced to 15. This makes a great difference to many businesses.
Unfair Dismissal
Employees are now excluded from pursuing unfair dismissal applications if:
- They are employed by a 'Small Business' which employs less than 15 employees - but these employers still have to follow the Small Business Fair Dismissal Code.
- They are a high income earner (earn over $106,400 including SGC). This is defined as 'guaranteed annual earnings' (doesn't include performance related bonuses or commission).
- Have been employed for less than 12 months in a small business or less than 6 months in a medium or large business's.
- They submit their unfair dismissal application after 14 days. The time limit for lodging an unfair dismissal claim has increased from 7 to 14 day.
|
Fair Work Act Requirements |
Action Required |
Required by |
|
| Unfair dismissal | Due process required | If you are a small business (less than 15 employees) - follow the Small Business Fair Dismissal Code. For businesses larger than 15 employees, develop and implement proper and fair performance management practices. | 1 July 2009 |
Restructuring
Redundancies must go through a consultative process from 1 July 2009 - rather than a Company making an unilateral decision to restructure and make a role redundant. You will now need to introduce a consultative and re-deployment procedures so as to avoid or minimise the risk of successful unfair dismissal applications. Compulsory severance where a role is made redundant, will be payable for service from 1 January 2010 for most Award free employees.
|
|
Fair Work Act Requirements |
Action Required |
Required by |
| Restructuring process | Consultative process and redundancy as last resort | Implement consultative processes where you are considering making a role redundant. | 1 July 2009 |
Changes from 1 January 2010:
- Redundancy:
Compulsory severance where a role is made redundant, will be payable for service from 1 January 2010 for most Award free employees.
- Minimum Wage Safety Net
Even if on individual agreements, employers must comply with minimum wages stipulated in the federal minimum wages or modern awards.
- Independent Contractors and Sham Arrangements
When seeking to employee a new person in business, you must be clear when advertising and discussing the role and/or work requirement on whether the appointment would be an employment relationship or one that is an independent contracting arrangement.
- Qualifying Periods (probationary periods)
Large business = 6 months for employers who employ more than 15 employees
Small business = 12 months for employers who employ less than 15 employees
|
Fair Work Act Requirements |
Action Required |
Required by |
|
| Qualifying Period |
Large businesses - 6 months Small businesses - 12 months |
Update contracts for new employees from 1st January 2010 - depending on whether you are in a small business or large business. Ensure you have effective systems in place to monitor and provide regular feedback to employees throughout their qualifying period. | 1 January 2010 |
- Introduction of the National Employment Standards (NES's) - of which there are 10
The 10 National Employment Standards will apply to all employees - whether they are covered by an award or not.
Fair Work Act Requirements Action Required Required by Notice: Stepped notice period. Redundancy pay: Statutory severance. Notice period is a sliding scale, increasing with employee service. Ensure all new contracts conform to this change. Redundancy pay: Where role is made redundant (after following the new consultative standards) compulsory severance pay will need to be calculated for employee service from the 1 January 2010. No obligation to pay redundancy pay if the employee has less than 12 months service or is employed by a small business.
Maximum weekly hours of work
38 hours per week
Ensure your employment contracts and salaries paid allow for a maximum of a 38 hour week.
1 January 2010
Right to request flexible working hours
Staff will be able to request flexible hours until child is school aged or 18 if the child is disabled.
Change your HR policy to allow primary careers the option of asking for flexibility of hours in accordance with the new Act
1 January 2010
Parental Leave
Where an employee has served 12 months continuous employment, they are entitled to 12 months unpaid leave if they are the primary caregiver and have the option to extend for a maximum of another 12 months.
Change your HR policy and practice to enable primary caregiver to ask for parental leave extension. Use your discretion to grant or deny these requests on individual cases with respect to your genuine business requirements.
1 January 2010
Annual Leave
Statutory accrual of 4 weeks. This accrues progressively each year and is payable on termination.
Ensure you accrue for 4 weeks of annual leave per year - accrued for in each pay cycle and employees become entitled to it as soon as it is accrued.
1 January 2010
Personal/Carer's Leave and Compassionate Leave
10 days paid personal/carer's and 2 days per occasion for compassionate leave. Personal leave accrues progressively and is entitled as and when it has accrued and is not payable on termination.
Ensure you accrue for the entitlements as directed in the Act.
1 January 2010
Community Service Leave
Provide paid time off for eligible community service leave.
Ensure time off is granted for eligible community service.
1 January 2010
Long Service Leave
In accordance with state LSL Acts.
Ensure you accrue for Long Service Leave in accordance with applicable State legislation - no change.
no change
Public Holidays
Provide for paid day off for gazetted public holiday.
Ensure public holidays are paid, for full-time and part-time staff whose ordinary wok day falls on a gazetted public holiday. May mutually agree to work on a public holiday if the request to work on this day is reasonable and if another day or part-day is given in lieu (for Award-free employees only).
1 January 2010
Notice of termination and redundancy pay
1 January 2010
Provision of Fair Work Information Statement
Provide the Fair Work Information Statement.
Add Fair Work Information Statement to new employee job offer packs.
1 January 2010
Other Information
There will be a new independent umpire called Fair Work Australia, which replaces the Australian Industrial Relations Commission, Australian Industrial Registry, Australian Fair Pay Commission, Australian Fair Pay Commission Secretariat, Workplace Authority). They will be responsible for overseeing the new workplace relations system. The Office of the Fair Work Ombudsman will be the inspectorate responsibly for assisting employers, employees and organisations to comply with the new workplace relations laws.
The existing small claims mechanism will be extended to the Fair Work Division of the Federal Magistrates Court and the monetary limitation of the small claims mechanism will be increased from $10,000 to $20,000 including in relevant state and territory courts). This will allow employees to elect to have claims about entitlements (e.g. underpayment of wages) dealt with under a simple and quick mechanism.
Relevant Website Links
Australian Governement Department of Education, Employment and Workplace Relations: www.deewr.gov.au
Australian Industrial Relations Commission Award Modernisation: www.airc.gov.au/awardmod/
