Stronger safety net amendments now in force

By Joe Catanzariti.

Key Points:
Further amendments to the Workplace Relations Act 1996 (Cth) have been enacted to strengthen the safety net for workers and to clarify some other provisions in the federal Work Choices system.

Most of the provisions in the Workplace Relations Amendment (A Stronger Safety Net) Act 2007 (Cth), which was enacted by the Federal Parliament on 20 June 2007, became operative on 1 July 2007.

This Act amended the Workplace Relations Act 1996 (Cth) in a number of areas:

• the introduction of a fairness test for workplace agreements, collective and individual
• creating the Office of Workplace Ombudsman (replacing the Office of Workplace Services) and the Workplace Authority (formerly Office of the Employment Advocate); and
• transmission of business and duress provisions (see Chris Hartigan's article in this edition).

Developments after the Bill was introduced into Parliament: Senate Committee Report

After the Workplace Relations Amendment (A Stronger Safety Net) Bill 2007 was first introduced into Parliament and since we looked at it here, the Senate referred the Bill to the Employment, Workplace Relations and Education Committee.

The Committee received nearly 30 submissions, undertook public inquiry and reported on 14 June 2007.

The Committee majority noted in the Report that "flexibility in workplace agreements is crucial for improving productivity, employment and suitability of workplace conditions" and that this also allows "employees to negotiate conditions that are more appropriate to their circumstances".

The Committee took the view that a strengthened safety net was provided for workers in the Bill, and that:

"The fairness test will augment the already existing safety net - particularly as imparted by the Standard - and provide greater reassurance for vulnerable workers such as young people and those from non-English speaking backgrounds. The Fairness Test will extend to more than 90 per cent of the non-managerial workforce."

The majority of the Committee noted the concerns of those making submissions about the Bill and it recommended that:

• the Government should consider various technical and consequential amendments proposed to the inquiry in order to correct unintended drafting errors and ensure that the stated aims of the stronger safety net are met
• the Workplace Authority should note the concerns expressed in the inquiry about length of agreements which might be made in "exceptional circumstances"; and
• the Workplace Authority should also note concerns raised in the inquiry about the application of the fairness test and "ensure that these inform the performance of its duties, so the principle of fairness will be considered by all parties to have been observed".

The Report, noting that the Department of Employment and Workplace Relations should be commended for its drafting of the Bill so quickly, recommended that the Bill be passed.

Government amendments to the Bill

The Government proposed amendments to the Bill mainly relating to transmission of businesses and the fairness test.

In the end, there were some 44 government amendments to the Bill which were agreed to by the Senate on 19 June 2007 as well as two Family First Party amendments that were also agreed to. The House of Representatives agreed to the Senate amendments on 20 June 2007.

The fairness test now applies to workplace agreements and to variations to workplace agreements (lodged on or after 7 May 2007) which:

• cover employees working in industries or occupations which are usually regulated by awards and
• either modify or exclude protected award conditions.

The fairness test does not apply to Australian Workplace Agreements covering those employees with full-time (or full-time equivalent) base salaries of $75,000 or more. This upper limit of base salary does not appear to apply to those employees in industries regulated by awards.

Operation of Bill

Although the amending legislation was proclaimed on 28 June 2007 with most of the provisions including the fairness test becoming operative from 1 July 2007, it should be noted that the fairness test applied to relevant workplace collective agreements and individual Australian Workplace Agreements which were lodged on or after 7 May 2007, and to variations of agreements which are lodged on or after 7 May 2007.

Thanks to Marilyn Pittard for her help in writing this article.

For further information, please contact Joe Catanzariti.