Following strong criticism from employer groups and extensive negotiations with cross bench members in the Federal parliament, late yesterday the Federal Government released 34 pages of amendments to its first major tranche of proposed workplace relations reforms, the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 (Cth).
The Federal Government proposed the amendments after a marathon debate in the lower house and in the face of cross bench criticism for seeking to progress the Secure Jobs Bill without proper consultation, in order to meet its goal of passing the Secure Jobs Bill by 1 December 2022.
In our previous article, we summarised the key reforms proposed by the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 (Cth) (Secure Jobs Bill). These reforms are designed to amend the Fair Work Act 2009 (Cth) (Act) and to introduce many, but not yet all, of Labor’s pre-election promises or those matters discussed and agreed at the recent Jobs and Skills Summit.
In this article, we summarise the amendments to the Secure Jobs Bill which were proposed by the Federal Government and which have today been passed by the lower house, as the Federal Government attempts to have the Secure Jobs Bill passed.
Security of Jobs
Fixed term contracts
The proposed amendments to the Secure Jobs Bill seek to strengthen the anti-avoidance provisions which apply in this area.
In particular, the proposed amendments will make clear that an employer may not:
- terminate an employee’s employment for a period;
- delay re-engaging an employee for a period;
- fail to re-engage an employee and instead engage another person to perform the same, or substantially similar, work for the person as the employee had performed;
- change the nature of the work or tasks the employee is required to perform; or
- otherwise alter an employment relationship,
in order to avoid any right or prohibition on the use of fixed term contracts.
Flexible work
The proposed amendments to the Secure Jobs Bill add a note to clarify when an employer may have ‘reasonable business grounds’ for refusing an employee’s request for a flexible working arrangement.
The following grounds will still be included:
- the new working arrangement will be too costly for the employer;
- there is no capacity or it would be impractical to change the working arrangements of other employees to accommodate the request;
- the changes will likely result in significant loss of efficiency or productivity; or
- the changes will likely have a significant negative impact on customer service.
The proposed note makes clear that the specific circumstances of the employer, including the nature and size of its enterprise, will be relevant to whether the employer has reasonable business grounds.
Wages and enterprise agreements
Termination of enterprise agreements after nominal expiry date
The Secure Jobs Bill proposes to replace the rules for terminating an enterprise agreement after its nominal expiry date has passed, including to stop employers applying to the Fair Work Commission (Commission) to unilaterally terminate an agreement where the termination would result in reducing employees’ entitlements (other than in particular circumstances).
It remains proposed that a nominally expired agreement can only be terminated if its continued operation would be unfair, if the agreement will no longer cover any employees, or if the agreement would have an adverse effect on the viability of the employer’s business.
However, under the proposed amendments to the Secure Jobs Bill, the Commission would also need to be satisfied that it is appropriate to terminate such an agreement in all of the circumstances.
Sunsetting of “zombie” agreements
The Secure Jobs Bill provides for the sunsetting of all remaining pre-Fair Work Act enterprise agreements (commonly referred to as “zombie agreements”).
The proposed amendments to the Secure Jobs Bill would require the Commission to publish any decision it makes to extend the default sunset period (which may be increased up to 4 years on application) and its reasons for doing so.
Better off overall test
The Secure Jobs Bill proposes to introduce a number of amendments to the Better Off Overall Test (BOOT) to remove any unnecessary complexity and ensure the BOOT is simple, flexible and fair.
One of the proposed amendments to the Secure Jobs Bill is to enable the Commission to reconsider the BOOT for a proposed enterprise agreement where, for example, new employees are employed after the BOOT’s original testing time and those employees will perform work in different patterns or different kinds or work not previously considered by the Commission.
Bargaining disputes
The Secure Jobs Bill proposes to repeal the existing, underutilised provisions for “serious breach declarations” and “bargaining-related workplace determinations” and replace them with a new regime comprising an “intractable bargaining declaration” and “intractable bargaining workplace determination”. These changes are designed to re-establish a mechanism for industrial dispute resolution by the Commission where parties have bargained for an extended period and exhausted all reasonable avenues to reach agreement.
The amendments proposed to the Secure Jobs Bill introduce a concept of a “minimum bargaining period” such that an intractable bargaining declaration can be made at the Commission’s discretion, but only in circumstances where:
- steps are taken to deal with the dispute under existing section 240 of the Act, which provides for bargaining representatives to seek the assistance of the Commission in circumstances of disagreement;
- there is no reasonable prospect of agreement being reached if the Commission does not make the declaration; and
- the “minimum bargaining period” has ended - for an existing agreement, this will be the earlier of 6 months after its nominal expiry date or 3 months after an application under section 240. For a new agreement, this will be 3 months after an application under section 240.
Supported bargaining
The Secure Jobs Bill introduces a regime of “supported bargaining”, which will permit bargaining across multiple employers and, in doing so, afford protections to employees (and employers) in low paid industries (such as aged care, disability care, and early childhood education) and those who may face barriers to bargaining.
The proposed amendments to the Secure Jobs Bill seek to introduce the concept of “excluded work”. Excluded work is defined as “general building and construction work” - this is work which is done onsite by an employee in the general building and construction industry, but excluding work in the civil construction, metal and engineering construction industries, in the mining industry, and in various trades.
It is also now proposed that the Commission will not be able to approve a multi-enterprise agreement that is not a greenfields agreement, unless it is satisfied that the agreement does not cover employees in relation to general building and construction work.
Single interest employer authorisations
This proposed change under the Secure Jobs Bill will permit multiple employers to bargain together for a “single interest employer authorisation” in wider circumstances than currently allowed under the Act and create a regime for variation of single interest employer agreements to include additional employers (and their respective employees).
Under these amendments to the Secure Jobs Bill, where:
- an application has been made by a union to vary a single interest employer agreement, or
- a single interest employer authorisation is brought by a union,
an employer and its employees will not be compelled to be part of that agreement or application where the employer has already agreed with the relevant union in writing to bargain for a proposed single-enterprise agreement that would cover the employer and the affected employees.
It is also now proposed that the Commission will be able to exclude employers from the terms of a “single interest employer authorisation” (or refuse to vary the authorisation to add employers) if it is satisfied that:
- employers are bargaining in good faith for a proposed enterprise agreement that will cover the employers and the relevant employees, or substantially the same group of the relevant employees;
- the employers and the relevant employees have a history of effectively bargaining in relation to one or more enterprise agreements in the past; and
- less than 6 months have passed since the most recent nominal expiry date of such an agreement.
If the effect of the above is that no employers would be specified in the authorisation, the Commission may refuse the application for the authorisation.
It is also proposed that the Commission must not:
- approve a variation of a single interest employer agreement to add employer and employees if the agreement is a greenfields agreement, and as a result of the variation the agreement would cover employees in relation to general building and construction work (see the definition in the section above); or
- make or vary a single interest employer authorisation in relation to a proposed enterprise agreement if the proposed agreement would cover employees in relation to general building and construction work.
Industrial action
The proposed changes under the Secure Jobs Bill in this area are designed to accompany the changes around multi-employer enterprise agreements.
The proposed amendments would remove the changes proposed in the initial draft of the Bill that industrial action will not be authorised by a protected action ballot to the extent (if any) that it occurs outside of a three month period starting on the date the ballot results were declared.
Gender pay gap
Prohibiting sexual harassment in connection with work
The proposed amendments to the Secure Jobs Bill are designed to preserve the concurrent operation of any State or Territory law dealing with sexual harassment, including where such a law allows an application to be made for an order or other direction to prevent a person from being sexually harassed, or to deal with a dispute relating to a sexual harassment allegation.
The proposed amendments to the Secure Jobs Bill also extend potential vicarious liability to the Commonwealth in relation to any acts of sexual harassment by a defence force member.
Regulatory changes
Establishment of the National Construction Industry Forum
The proposed amendments to the Secure Jobs Bill include establishing a National Construction Industry Forum.
The Forum’s purpose is to provide advice to the Federal Government in relation to work in the building and construction industry. That advice may cover issues including workplace relations, skills and training, safety, productivity, diversity and gender equity, and industry culture.
In addition to various Federal Government ministers, equal numbers of employee and employer representatives will also be appointed as members of the Forum. The Forum must meet at least twice a year.
The views expressed at Forum meetings are to be kept confidential, however members would still be able to report to persons or organisations they represent, and make public interest announcements agreed by the members of the Forum.
What is next?
We will need to wait and see whether the Federal Government is able to pass the Secure Jobs Bill before the end of the parliamentary year on 1 December 2022.
The KWM Employee Relations and Safety team will provide further updates as the Secure Jobs Bill progresses through parliament and as other changes are introduced by the Federal Government.
