Sarah O’Carroll looks at steps HR can take to make the transition from WorkChoices to the Fair Work Bill as painless as possible
The time for debate is over. The Rudd
Government has been successful in
delivering its promise to bury the Coali
tion government’s WorkChoices reforms.
While some employers may complain that
the “Forward with Fairness” reforms are
not a fair deal for employers, the fact is
that the Fair Work Bill has been passed
and the pendulum has swung back in
favour of employees.
From 1 July the first of the reforms will
come into play. And from 1 January 2010
the entire system will be in full swing.
So after these dates, many employers
and HR departments may find themselves
with a desk full of unprecedented claims,
submissions and papers to deal with. It
will be a different industrial legislative
environment to work in and HR depart
ments are being advised to prepare now,
to minimise the disruption when the
Of all the changes that are coming into
effect, those that are causing employers
most concern and confusion are those cov
ering workplace flexibility, unfair dismissal,
and what the abolition of AWAs means.
Among the most controversial of the Howard
government’s WorkChoices amendments
were the restrictions placed on access to unfair
dismissal. Employees who were employed by
a company of less than 100 employees could
not make an unfair dismissal claim. This will
change from 1 July this year.
Under the new provisions, in any small
business (which now means less than 15
employees) new employees can bring an
unfair dismissal only if they are employed
for more than 12 months. In all other busi
nesses workers can make a claim after six
months. Larger companies will not be
affected by the new unfair dismissal reforms.
“These companies will have to reorient themselves to pre
WorkChoices,” says Jane Seymour, director of Justitia Lawyers.
“If a company has less than 100 employees and has some under
performers and plans to cut staff, it will be in the employer’s
interest to work them out now, before 1 July. After that date they
could be faced with an unfair dismissal claim.”
HR tips: According to Seymour, performance management
will become increasingly important for companies, especially
in light of so many recent redundancies.
“There has been a definite increase in discrimination claims,
and, while small business employees will not be entitled to an
unfair dismissal claim, they can still bring forward an unlaw
ful termination claim,” she says.
“So, for example, if you decide to terminate somebody based
on their performance, but you have not documented their poor
performance or told them about it, the employee could choose
another discriminatory reason as to why they think they are
being let go,” says Seymour. “And then the onus is on the
employer to disprove that.”
Therefore, she says, it is very important
for HR departments to emphasise the need
for documented performance management.
Seymour outlines a few steps that HR
departments should be taking in the run-
up to 1 July to be prepared for the unfair
• If you have fewer than 15 employees,
review the Small Business Fair Dis
• Review redundancy and termination
policies and internal procedures and
consider updating to reflect jurisdic
• Review casual employees to assess employees and ascertain whether pattern of
employment is “regular and system
• Review performance management/ter
mination policies and internal proce
dures and educate managers on criteria
for considering harshness of dismissal
• Determine who will appear at concil
iation hearings at Fair Work Australia
and provide any necessary training
Australian Workplace Agreement (AWA)
Deputy Prime Minister Julia Gillard for
mally requested the Australian Industrial
Relations Commission (AIRC) to com
mence the award modernisation process.
This has not been foremost on the list of
employers’ concerns so far, but, accord
ing to Seymour, it will become very
important as time goes on.
“It’s a bit of a sleeper issue,” says Seymour.
“A lot of employers are obsessed with
unfair dismissal but the awards are prob
ably the thing that will have the biggest
impact in the long term.”
The modernisation process means
firstly that Australian Workplace Agree
ments (AWAs) have been abolished. Under
the old WorkChoices scheme, if an
employer did not want to be bound by
the provisions of an award (eg to not pay
someone overtime or allow them to work
excessive hours) they could enter into a
one-on-one agreement with the employee
– known as an AWA.
This would be lodged with a third
body and allow the employer to get out of
the award provisions. The unions have
always been opposed to AWAs because
they were skewed in favour of business
and could lead to an employee being
forced into signing an agreement because
they needed the job. Essentially the
employer held all the cards.
Up until now, employees have been
covered by more than 3000 awards at fed
eral and state level. The modernisation
process which began on 1 January 2008
and will finish on 31 December 2009, will
see the AIRC cutting these awards from
3000 down to 100.
“This process [of reducing the num
ber of awards] is underlying throughout
the whole thing,” says Seymour. “It’s a
very significant development.
“An example is the broadcasting and enter
tainment industry. There are the TV
awards, radio awards, striptease workers
award, actors award – which all have to
be brought down to one media and enter
Employers in each industry will have
to keep on top of these groundbreaking
changes to their industry awards because
they will lead to various workers being
covered by new awards.
For example, an employer may have
someone under a specific award who was
getting paid time and a half for overtime
but under the new award they may have
to be paid double time.
The first stage of awards has been pub
lished. The last ones won’t be finished
until November, so industries in the last
sector will have little time to adjust.
HR tips: “Well the first thing is to iden
tify which finalised Modern Awards will
apply to your business, and to which
employees and audit compliance with
terms and conditions,” says Seymour.
“So you need to work out which is the
new award that will apply to your people.
For example, if I employ some journal
ists, some clerical workers and some man
agers I have to look at the award that
applies to each sector of employees and
assess whether I am paying them in accor
dance with the new award.
“With clerical people there will be a
national clerical award which has already
been finalised, and for managers they may
actually be award-free. So there needs to
be that analysis of each type of worker
within your business, looking at the
award that covers them, and see whether
you are actually complying with them.”
Employers can go online to the AIRC
website to see what industry awards are
finalised. If employers then want to make
a submission through their employer asso
ciation, she says, they must do so soon.
“For example, the awards for Racing Clubs
NSW have already been finalised and they
made submissions saying they should have
their own club award and they were suc
cessful,” says Seymour.
The Racing industry successfully made submissions to the effect that there should be separate awards for racing clubs, ground maintenance and horse and greyhound training. Three modern awards have therefore been published for the Racing industry.
The new awards could also mean extra
costs for companies with some wages hav
ing to be increased by up to 22 per cent.
“HR departments should also be
thinking about briefing their board about
these possible extra costs,” says Seymour.
NES and flexibility requests
The Coalition’s Australian Fair Pay and
Conditions Standard will be replaced in
January 2010 by 10 National Employ
ment Standards (NES). Of these 10 new
standards, employers are most concerned
by those covering workplace flexibility
and family responsibilities.
Under the new NES, from 2010
employees will be entitled to more gener
ous maternity leave arrangements. The
NES will extend the minimum entitlement
to maternity leave from 12 months of
unpaid leave by allowing employees to
make a written request for up to a further
12 months of unpaid leave (ie a total of up
to 24 months unpaid maternity leave).
An employer must have “reasonable
business grounds” for refusing an
employee’s request for the additional 12
months and the employee must also be
entitled to return to the same position she
held prior to commencing leave.
Regarding the right to request flexible
working hours, for the first time ever,
from 1 January 2010 workers who care for children under
school age will have the right to request flexible working
arrangements. The employee must make a request in writing
and the employer must give a written response within 21 work
ing days. If the employer refuses the request they must give the
HR tips: The question employers may ask themselves is how
they are going to deal with requests such as up to two years’
parental leave and how they are going to set up systems inter
nally to make sure they are being fair and consistent in how
they are granting or declining leave.
“You will have to look at the type of job the individual is
doing, but I think it’s about looking at setting up systems,” says
Seymour. “What we don’t want are managers making a decision
on an individual level. What we want are some principles at a cor
porate level that will guide decisions they make. Because if you
are making decisions randomly you are always going to run the
risk of somebody saying you are discriminating against them.”
Seymour says that unless an employer can point to a docu
ment or principle there is the potential for a lot of arguments.
Employers need to be very clear, she counsels, and perhaps look
at how they currently fill a maternity vacancy.
“It’s quite untested. But the law has made a decision that it
should support families in raising their children. It’s non-dis
criminatory, because it’s fathers too, so whether you agree with it
or not, a decision has been made by our parliament that it is impor
tant to support men and women. You need to have some pretty con
vincing reasons if you are not going to grant it,” she says.
“A lot of good employers will be doing this anyway, but by
January 2010 all companies will have to do it.
“Companies should determine responsibility and procedure
for considering and responding to requests and general posi
tion in relation to granting and declining requests.”
Seymour suggests, for example, that every request the company
receives be allocated to two people, and that these people have
responsibility for applying policies or guidelines to each request.
She also recommends that companies make sure managers
know that when they receive a request for a flexible work
arrangement they must send it promptly to the person respon
sible because they have only 21 days to respond.
Note: On 20 March 2009, the Senate passed the Fair Work Bill. Importantly, the definition of ‘small business’ was amended for the purpose of unfair dismissal. Which means:
Unfair Dismissal –For the purpose of the unfair dismissal laws, small business employees with less than 12 months' service and other employees with less than 6 months' service will not be entitled to bring an unfair dismissal claim. ‘Small business’ means an employer with less than 15 employees. The Senate passed the Fair Work Bill on 20 March 2009. There were a number of last minute amendments, including the introduction of a transitional arrangement whereby ‘less than 15 employees’ will be calculated on a 'full time equivalent' basis until January 2011, when it will revert to a ‘headcount’ basis.