New Employment Changes from 1 January 2010
16 December 09 Are you prepared for the new Employment Changes from 1 January 2010?On 1 January 2010, the balance of the Fair Work Act commences. The Queensland Parliament has now referred the State's Industrial Relations (excl Public Service employees) powers to the Federal Government. This aims to simplify the industrial relations system. As an employer, you need to ensure that you are aware of the changes that affect your business and your employees.
The legislation has put an end to the confusion and duplication that has existed due to having a State and Federal Industrial Relations System and enables all employers and employees to participate in a single, national industrial relations system. From 1 January 2010, it will not matter if you are a company or not all entities will be covered by one national system.
What happens after 1 January 2010?
State Awards that apply to employees prior to 1 January 2010, will continue to apply for 12 months before they are terminated and replaced with the relevant awards.
A no-detriment test will be applied to the State Awards to ensure that the awards comply with the National Employment Standards and they must pay above minimum wage rates as set in the national minimum wages order.
If the employer and employees covered by a State Award decide to enter into a Federal Enterprise Agreement after 1 January 2010, the agreement will be assessed against the State Award using the Better Off Overall Test.
State employees, who are not covered by a State Awards, may be covered by one of the new Modern Awards. Therefore, it is possible that an employee, who is currently award-free, may fall under a modern award under the Federal System from 1 January 2010.
Employees that are not covered by an award or agreement and are transferring from the State system on 1 January 2010 will be entitled to receive the greater of their relevant salary under the State minimum wage or the national minimum wage.
The National Employment Standards will apply to all employees from 1 January 2010.
From 1 January 2010, Federal unfair dismissal laws will apply. Businesses that have less than 15 full-time employees will need to comply with the Small Business Fair Dismissal Code when terminating an employee's employment if the employee has had more than 12 months continuous service. (If terminated within the first 12 months of their employment, the employee is exempt from commencing unfair dismissal proceedings)
From 1 January 2010, a business that has more than 15 full time equivalent employees, the Small Business Fair Dismissal Code does not apply and employees are only exempt from an unfair missal claim where they have less than 6 months continuous service.
High income earnings (earning more than $108,300 pa), will not be covered by the modern awards and are not eligible to commence an unfair dismissal claim.
All new employees must be provided a Fair Work Information Statement as soon as practicable after the commencement of employment. (published by the Fair Work Ombudsman)
What are the 10 National Employment Standard entitlements?
The NES are set out in the Fair Work Act 2009 and comprise 10 minimum standards of employment. In summary, the NES involve the following minimum entitlements:
Maximum weekly hours of work 38 hours per week, plus reasonable additional hours.
Requests for flexible working arrangements allows parents or carers of a child under school age or of a child under 18 with a disability, to request a change in working arrangements to assist with the child's care.
Parental leave and related entitlements up to 12 months unpaid leave for every employee, plus a right to request an additional 12 months unpaid leave, plus other forms of maternity, paternity and adoption related leave.
Annual leave 4 weeks paid leave per year, plus an additional week for certain shift workers.
Personal / carer's leave and compassionate leave 10 days paid personal / carer's leave, two days unpaid carer's leave as required, and two days compassionate leave (unpaid for casuals) as required.
Community service leave unpaid leave for voluntary emergency activities and leave for jury service, with an entitlement to be paid for up to 10 days for jury service.
Long service leave a transitional entitlement for certain employees who had certain LSL entitlements before 1/1/10 pending the development of a uniform national long service leave standard.
Public holidays a paid day off on a public holiday, except where reasonably requested to work.
Notice of termination and redundancy pay up to 4 weeks notice of termination (5 weeks if the employee is over 45 and has at least 2 years of continuous service) and up to 16 weeks redundancy pay, both based on length of service.
Provision of a Fair Work Information Statement employers must provide this statement to all new employees. It contains information about the NES, modern awards, agreement-making, the right to freedom of association, termination of employment, individual flexibility arrangements, rights of entry, transfer of business, and the respective roles of Fair Work Australia and the Fair Work Ombudsman.
Are there any other changes?
Other Fair Work Act changes include:
Requirements for keeping employee records and payslip contents are similar to existing ones, except that any individual flexibility arrangements must be recorded in writing
A written 'guarantee of annual earnings' for high paid employees (ie. those earning more than $108,300, indexed annually, and covered by a modern award) to exempt high paid employees from award conditions
A prescribed form of notice of representational rights must be used when proposing an enterprise agreement
What do employers need to do?
Become aware of the new laws, particularly the unfair dismissal laws, the National Employment Standards and the relevant modern awards for their workplace.
Consider having your employment contracts reviewed to ensure compliance with the National Employment Standards and the relevant award.
If you are unsure about any of these issues or about award coverage, please contact us so that we can assist in providing you with further information.
Where can I find more information?
Information about the Fair Work Act for employees and employers is at
http://www.fairwork.gov.au/Pages/default.aspx
The new Modern Awards can be found at http://www.airc.gov.au/awardmod/fullbench/awards.htm