Chaos by consent – the WorkChoices IR State awards maze

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Chaos by consent – the WorkChoices IR State awards maze

The WorkChoices laws are due to come into operation on March 27, so if you are an employer or employee under a State award you will be transferred to a notional federal agreement under the new system, right? Er, maybe.

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The WorkChoices laws are due to come into operation on March 27, so if you are an employer or employee under a State award you will be transferred to a notional federal agreement under the new system, right? Er, maybe.

The new WorkChoices system does have that process as a fundamental basis of the new national IR system, but is that what will actually happen? Yes, no and maybe.

And don’t think it is just a trivial issue. A quick look at the NSW Department of Industrial Relations website indicated the type of employers who could be covered by this change include Boral, Bluescope Steel, Blue Circle Southern Cement, ADECO, Avon and Port Waratah Coal Services.

Currently if you are in a State other than NSW and Victoria, that will happen. Victoria has already ceded its IR powers to the Commonwealth so is already part of the federal system.

NSW - particular issues

But what about NSW? Earlier this month the State Government passed amendments to the State’s IR legislation which have, amongst other things, deemed State consent awards (which have been negotiated between and employer and union, or employer and employees) to be State enterprise agreements - and therefore exempt from WorkChoices until they expire.

Staff formally employed by the Area Health Services and other statuary corporations, authorities and agencies will be employed directly by the NSW Government, starting 17 March.

The legislation was proclaimed to commence on 17 March 2006. Details of the legislation can be read here.

This was done as an attack on the Federal Government’s plans to take over the States’ IR powers under its corporations laws.

So this means if you are an employee or an employer under a NSW state consent award you are not under WorkChoices, at least for a while? Maybe.

The difficult question

Since the State Government amendments say that each consent award has to go before the NSW IRC to be made into an agreement, doesn’t that mean if WorkChoices comes into existence before the award goes before the Commission, the consent award at that point is swallowed up by WorkChoices because it is still an award?

Not according to the State Government, because its IR law amendments declare that whenever the consent award comes before the NSW IRC it is deemed to have been made an enterprise agreement on the day BEFORE WorkChoices comes into operation, regardless of when that was.

So that means that in NSW state consent awards have escaped the clutches of WorkChoices, doesn’t? Again, maybe.

Will the amendment work?

There is a view that it will be difficult to make this amendment work.

This view states that WorkChoices defines a 'state award' as an award, order, decision or determination of a state industrial authority, which consent awards are.

A 'state employment agreement' is an agreement between an employer and employee(s) or union(s) in force under a state industrial law which prevails over any inconsistent state award(s).

Enterprise agreements are approved but not made by any order of the commission and prevail over awards. So, can a consent award which is ‘made’ by an IRC be turned into an enterprise agreement by an IRC which does not have the power to ‘make’ agreements?

And more to the point, what is the status of the State consent agreement between the time WorkChoices comes down and the time it goes before the NSW IRC to be made into a State enterprise agreement, which may be weeks or months?

During this period is it a notional federal enterprise agreement or a state consent award? And if it is a federal enterprise agreement, how can a state IRC have the power to turn it back into a state consent agreement and then into a state enterprise agreement?

Other states considering NSW tactic

Under pressure from unions, the other State Governments (apart from Victoria) are looking at the new NSW system and some or all may adopt it. Employers and employees in other States may soon be faced with the same legal maze.

So, in the future, after the federal WorkChoices laws have turned State consent awards into notional federal agreements, but the NSW amendments have turned the consent awards into State enterprise agreements (ostensibly the day before WorkChoices, but actually after it happened), which system will the employers and employees of the NSW consent agreements which exist today be under, federal or state?

The answer is coming soon to a High Court near you. But not very soon. In the meantime, Good Night and Good Luck!

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