New Workplace Relations Laws - Things You Must Know
On 1 January 2010, the second phase in implementing the Fair Work Act 2009 will commence when Modern Awards and the National Employment Standards (NES) come into operation. The Fair Work Act is applicable to organisations covered by the “national system”. These organisations include all constitutional corporations (companies) across Australia, and all employers in Victoria, the Australian Capital Territory and the Northern Territory and many in New South Wales, Queensland, Tasmania and South Australia moving into the national system. If you are unsure whether you are in the “national system”, you can find out more at:
The NES will set minimum standards of employment for employees in the following areas:
• Maximum weekly hours of work;
• The right to request flexible working arrangements;
• Parental Leave and related entitlements;
• Annual Leave;
• Personal/Carer’s Leave and Compassionate Leave;
• Community Service Leave;
• Long Service Leave;
• Public Holidays;
• Notice of termination and redundancy pay; and
• A “Fair Work Information Statement” for all employees that outline their rights and entitlements under the new system.
You can read about the NES in more detail at:
Key Changes
1. Modern Awards: New Modern Awards will become effective and apply to employers and their employees in the national system.
Modern Awards will reduce and consolidate the thousands of awards currently in operation around Australia. Modern Awards will incorporate the NES mentioned above.
Modern Awards will also incorporate “flexibility clauses”. Flexibility clauses allow for a written agreement between an individual employee and the employer to vary an award in the following areas:
• Arrangements for when work is performed;
• Overtime rates;
• Allowances; and
• Leave loading.
An agreement to vary an award must not, on balance, lead to a reduction in the overall terms and conditions of employment.
Due to the pending commencement of the Modern Awards, employers will need to be abreast of the new award(s) that are applicable to the workplace. A Modern Award may incorporate new rates of pay and penalty rates – although these will generally only become applicable from 1 July 2010, and in some cases, phased in over 5 years. Remember that breaches of the Fair Work Act or of a Modern Award can lead to penalties of up to $33,000. Modern Awards can be reviewed at:
http://www.airc.gov.au/awardmod/fullbench/index.htm.
2. Pay Slips: From 1 January 2010, pay slips must contain an employee’s commencement date with the organisation, and the organisation’s ABN, in addition to the current mandatory content.
3. Flexible Work Arrangements: The NES gives employees the right to request a change to working arrangements if they have completed 12 months’ continuous service and are parents of, or have caring responsibilities for, a child under school age, or a disabled child under 18. A request may only be refused on reasonable business grounds.
4. Parental Leave: Each member of an employee couple may take up to 12 months unpaid parental leave following the birth of a child or the placement for adoption of a child under 16. An employee who has taken 12 months leave may request an extension for a further period of up to 12 months. Therefore, up to 24 months unpaid leave is available. A request for extension may only be refused by an employer on reasonable business grounds.
5. Community Service Leave: The NES provides a paid entitlement for employees required to attend jury service and unpaid leave for those who engage in voluntary emergency management activity.
6. Annual Leave and Personal Leave: Modern Awards and agreements may include provisions dealing with cashing out of annual and personal leave. Award and agreement free employees may also agree with their employer to cash out their leave.
An agreement to cash out annual leave must be made in writing and the payment must be for the full amount that the employee would have been paid if the employee had taken the leave. The employee must retain a balance of 4 weeks annual leave after the cash out.
The same provision applies to personal leave, however, a balance of 15 days of personal leave must remain after the cash out.
7. Redundancy Pay: An employee whose position is made redundant is entitled to a payment based on years of continuous service with the employer. However, where an employee is made redundant after 1 January 2010 and was award free as at 31 December 2009 and the terms and conditions of employment do not already provide for redundancy pay, an employee’s service with an employer before 1 January 2010 will not be taken into account for the purpose of calculating an employee’s entitlement to redundancy pay.
The information above is not exhaustive and should not be read in isolation of receiving comprehensive professional advice relevant to you and your organisation.
If you would like to find out more about any of these changes, we may be able to assist you.
Free information seminars are also being held nationwide. You can find a list of some of the free seminars in your State or Territory at:
http://www.deewr.gov.au/WorkplaceRelations/newworkplacerelationslaws/Pages/default.aspx