15 Things You Need to Know From 2015

As we approach the end of February – and 2016 begins to pick up speed – we thought it was worth taking a moment to reflect on last year. Here’s our roundup of the 15 things you need to know from 2015.

1. Amendments to the Fair Work Act

Despite the anticipation of significant amendments to the Fair Work Act 2009 (Cth), only a limited number of changes were actually implemented.

• Changes to Greenfields Bargaining: Allowing employers greater power to end protracted negotiations and increase efficiency when creating new enterprise agreements with unions.
• Protected Action Ballot Orders: Unions must obtain a majority support determination from the Fair Work Commission, rather than take protected action, such as strikes.
• Unpaid Parental Leave: If an employee seeks to use the additional 12 months unpaid parental leave provided by the National Employment Standards, the employer must provide them with a reasonable opportunity to discuss the request before refusing.
• Interest on Unclaimed Monies: Where the Fair Work Ombudsman (FWO) has been paid unclaimed monies by an employer which is payable to an employee, the FWO will be required to pay interest on any unclaimed amount.

2. Amendments to the Queensland Industrial Relations Act

The Palaszczuk Government passed the Industrial Relations (Restoring Fairness) and Other Legislation Amendment Act 2015 (Qld) which made the following changes to the Industrial Relations Act 1999 (Qld) (the IR Act):

• Reinstating employment conditions for State Government employees, which were lost as a result of changes to the IR Act during 2012 and 2013.
• Re-establishing the independence of the Queensland Industrial Relations Commission (QIRC) when determining wage cases.
• Returning the QIRC to a layperson’s tribunal with all parties on a level playing field.
• Restoring the right of entry provisions for unions.

These amendments make numerous changes to those implemented by the Newman Government, particularly in respect of the Queensland Employment Standards.

You can read more about these changes here.

3. Amendments to the Work Health and Safety Act 2011 (Qld) and the Workers’ Compensation and Rehabilitation Act 2003 (Qld) 

After a series of amendments to both pieces of legislation under the Newman Government, the Palaszczuk Government reversed a number of those changes in 2015.

Work Health and Safety Act 2011 (Qld):

• WHS entry permit holders can enter a workplace immediately if a contravention is suspected, and provide notice of entry as soon as reasonably practicable, removing the requirement of 24 hours’ notice.
• A trained Health and Safety Representative can direct a worker to cease work if there is a reasonable concern of serious and immediate or imminent risk to health and safety if the work continues.
• The requirement for Health and Safety Representatives to provide 24 hours’ notice for an assistant to access the workplace was removed.
• The maximum penalty for a contravention of entry permit conditions was reduced from 200 penalty units to 100 ($11,780).

Workers’ Compensation and Rehabilitation Act 2003 (Qld):

• The 5% permanent impairment threshold requirement for common law claims was removed.
• Employers can no longer access a prospective worker’s claims history summary. This amendment does not, however, prohibit employers continuing to request that a prospective employee disclose any pre-existing injuries which may be aggravated by the performance of the position.

4. Review of Modern Awards

During 2015, and continuing into 2016, the Fair Work Commission (FWC) is undertaking the four-yearly review of modern awards. As a result of this process, the FWC has:

• Drafted model provisions for insertion into modern awards, in respect of:
• Annual Leave – including a right for employers to direct employees to take annual leave where their accrued leave exceeds 8 weeks, and an ability for both parties to agree for an employee to take leave in advance.
• Time Off In Lieu – to allow time off in lieu to be taken, instead of payment for overtime. At this stage, the FWC is still receiving and considering submissions from interested parties in respect of the model clause. Watch this space!
• Held that 11 modern awards are to be amended to fall into line with the National Employment Standards.
• Determined that the transitional provision in respect of absorption of any overpayments made by an employer will now be removed. Consequently, employers will need to ensure that any overpayments made to employees is appropriately documented, such as the inclusion of an “offsetting” clause in employment contracts.

As the review continues, further amendments are likely across a variety of modern awards. For more information about the four-yearly review process, see the Fair Work Commission’s website here.

5. Productivity Commission Update

The Productivity Commission’s inquiry report into the Workplace Relations Framework was released to the public on 21 December 2015. The report makes several key points, including:

• The workplace relations system “is not dysfunctional – it needs repair not replacement”, however, “several major deficiencies need addressing”.
• Changes to the way the FWC operates, including the creation of a new body, (the Workplace Standards Commission), which would specifically deal with determining minimum wages and award regulation.
• Alignment of Sunday and Saturday penalty rates, creating a ‘weekend rate’ for relevant industries.
• The potential scope for a new form of employment arrangement – an ‘enterprise contract’ – allowing individual organisations to tailor terms of awards to suit its individual needs.
• Recalibrating the test from ‘recklessness’ to ‘reasonableness’ in regard to sham contracting, to prevent employers too easily escaping prosecution.
• Additional support for the FWO to detect and pursue employers exploiting migrant workers.

The above list is only a few of the key points contained in the report. The entire report is available from the Productivity Commission’s website here. 

6. The Royal Commission into Trade Unions

The Royal Commission into Trade Union Governance and Corruption made several headlines in 2015, and the final report found that misconduct was “widespread” and “deep-seated”.

Comprising a total of six volumes (one of which is confidential and not publically available), the report detailed 79 recommendations.

The five publically available volumes of the final report can be accessed here.

7. Pay and Other Rate Increases

July 2015 saw increases to the national minimum wage, together with pay rates in Modern Awards. The High Income Threshold was increased, and there was also an increase to the value of a penalty unit (meaning that penalties for breaches of the Fair Work Act also increased).

The Redundancy Tax Concession increased, allowing a greater tax free component for genuine redundancy payments. You can read more about these changes in our July 2015 post, 5 Things Your Need to Know for the New Financial Year.

8. Underpayments

2015 saw several newsworthy underpayment matters.

Myer was found twice to be liable for underpayments to cleaning staff after they had been misclassified and underpaid. A chain of responsibility exists to ensure all links in the supply chain are compliant with workplace laws, including the correct payment of wages and entitlements. You can read the Fair Work Ombudsman’s media release here.

Grill’d also came under fire after an employee was allegedly terminated following her complaint that she was underpaid. The matter encompassed a range of other issues, including allegations of bullying by the employee towards two managers, and the existence of a ‘WorkChoices-era’ greenfield agreement.  The matter remains ongoing.

Most notably, however, were the significant underpayments found to exist in 7-Eleven stores. This has spilled over into the current Senate inquiry into the impact of Australia’s temporary work visa programs on the Australian labour market and on the temporary work visa holders. The scope of the inquiry was extended to allow further investigation into the 7-Eleven issues, and found there was “consistent evidence of widespread and systemic underpayment of wages and entitlements sometimes amounting to many tens of thousands of dollars per employee”. The Inquiry remains ongoing.

To read more, you can access the Interim Report of the Senate Committee here.

9. Paying Annual Leave on Termination

A ruling from the Full Federal Court determined that annual leave which is payable to employees on termination of their employment, is to be paid out at the same rate they would have received if they had taken the leave while employed.

This means if there was an entitlement to annual leave loading during the employment, the loading would also be payable when the accrued leave entitlement is paid out upon termination.

10. Contractors vs Employees

The Full Court of the Federal Court concluded that the test of whether a worker is an ‘entrepreneur’ is simply another layer in determining whether the worker is an employee or contractor. This is a move away from the reliance placed on whether the worker was an ‘entrepreneur’ in other recent decisions.

11. Unfair Dismissal – Undertake Reasonable Investigations

Numerous unfair dismissal cases throughout 2015 indicated the necessity for employers to ensure that proper and reasonable investigations are undertaken before considering terminating employees.

For example, in one case, the FWC held that although the employer may have reasonably believed the employee’s behaviour was sufficiently serious to justify dismissal, there were no reasonable grounds for this belief.  Therefore, the dismissal was not consistent with the Small Business Fair Dismissal Code.

As the dismissal was not consistent with the Small Business Fair Dismissal Code, the FWC then had to consider whether the dismissal was harsh, unjust or unreasonable. The Commission held the dismissal was harsh and unjust, but not unreasonable, as the employee was not afforded procedural fairness when the dismissal was effected.

12. General Protections – Broad Rights

The Federal Circuit Court held that a claim for General Protections can be made based on a broad workplace right, including the right to express a political opinion.

The Court held that “a person will exercise such workplace right if the person makes a complaint or enquiry about his or her employment rights or obligations, or if the person makes a complaint or inquiry about a subject that may prejudice the person in his or her employment”. In terms of political opinion, the Court held that a view regarding how corporations should obey the law could constitute a political opinion, and therefore be protected by the General Protections provisions.

13. Bullying Update

Although in a different state, the Victorian Supreme Court has ordered a company to pay an employee $1.36 million in damages and compensation because the employee sustained significant psychiatric injuries after being subjected to bullying, abuse and sexual harassment.

In the Federal arena, the Fair Work Commission has made several interesting decisions in its anti-bullying jurisdiction. These include:

• Publishing a stop bullying order, including reasons.
• Ruling that a resident caretaker and resort manager, who was also a shareholder/director and employee of the resort’s company, could be considered a ‘worker’ and was eligible to pursue an anti-bullying claim.
• That the FWC has jurisdiction to hear a bullying complaint against a not-for-profit organisation, as it was ruled to be a trading corporation.

14. Drugs, Alcohol and Medical Testing

In 2015, the Full Bench of the Fair Work Commission upheld that an employer has the right to test employees for drugs and alcohol using a random mix of both saliva and urine testing methods, and that the benefits of adopting both testing methods significantly outweighed any privacy detriments.

15. Liability of HR Managers

Importantly, 2015 also saw HR Managers held personally responsible for decisions regarding the termination of employees.

In one Federal Circuit Court decision, an HR Manager was fined more than $1,000 after an employee was not provided sufficient notice on termination. In another case, two HR Managers were issued with penalties totalling $7,000, after they carried out orders of the company and ‘failed to exercise their choice to refuse to comply’. This is a significant warning for HR Managers to heed, and beware that you can be held personally liable for decisions.