Australian Industrial Relations Commission &  WorkChoices


Australian Industrial Relations Commission & WorkChoices

Much has been stated by the Federal Government of the anticipated role the Australian Industrial Relations Commission (AIRC) will have under the proposed WorkChoices legislation.


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Much has been stated by the Federal Government of the anticipated role the Australian Industrial Relations Commission (AIRC) will have under the proposed WorkChoices legislation. While the AIRC is expected to have a diminished role under the proposed new IR system, it will still have responsibility for certain matters which relate to industrial disputes and other disputes between an employer and employees.

This article looks at the role the AIRC will have under the proposed WorkChoices legislation.

Areas of responsibility

The AIRC will have the responsibility of simplifying awards, regulating industrial action and registered organisations and an ongoing role in relation to termination of employment.

Dispute resolution

Under WorkChoices, the AIRC will retain its powers to resolve disputes arising under agreements but only where those functions are expressly conferred on it by the parties, ie. under a 'dispute settling procedure' in a federal agreement.

Agreement making

It will retain its power to resolve matters arising during the negotiation of an agreement and will be able to assist with dispute resolution when considering the making of an order to prevent or stop unprotected industrial action but it will not be able to delay making orders which must be issued within 48 hours. In a dispute settling procedure, however, the parties can choose between referring a matter to a private 'alternative dispute resolution' (ADR) provider or to the AIRC for assistance.

Dispute settlement procedure

The WorkChoices legislation contains a model dispute settling procedure (DSP). The model will be included in all awards as well as agreements which are lodged without their own DSP. In addition, the legislation establishes a system of registered private ADR providers that may be accessed by the parties instead of the AIRC.

Voluntary dispute resolution - exceptions

The AIRC will provide voluntary dispute resolution services with limited exceptions, eg. in cases where a bargaining period is terminated because industrial action is threatening to endanger life, personal safety, health or welfare, or to cause significant economic damage; or the Minister for Employment and Workplace Relations has issued a declaration under the essential services provisions.


The AIRC will have a role in the award rationalisation and simplification processes, and will be able to vary, set aside or revoke awards.

It will not be able to vary or adjust non-allowable matters in existing awards, eg. long service leave, superannuation, notice of termination and jury service. Any new awards will not be able to contain these non-allowable matters.

The circumstances in which the AIRC may vary awards include:

  • if the variation is essential to the maintenance of minimum safety net entitlements; or

  • removing uncertainty or ambiguity from the award; or

  • removing discriminatory provisions; or

  • reflecting changes in the names of organisations or persons bound by an award.

Transitional awards and agreements

It will take some time to bring in the new system in all respects. Transitional awards will be an important element in the system as it moves to a WorkChoices regime. Here is an explanation of how transitional awards will operate.

Transitional system: The transitional system involves the ongoing limited operation of 'transitional awards' (ie. current federal awards) in relation to employers who are not constitutional corporations.

The AIRC will have the ability to set aside or revoke transitional awards and make orders to enable parties to opt out of the transitional system in limited circumstances. These limited circumstances are if the AIRC is satisfied that the parties have genuinely not been able to conclude a state agreement or if there is a genuine industrial dispute between the parties which the AIRC is not able to resolve utilising the powers it will have in the transitional system.

Powers limited: The AIRC will not be able to make new awards for businesses that are not constitutional corporations during the transitional period. However, the AIRC may vary wages rates and other 'monetary' entitlements in transitional awards, ie. incentive-based payments, piece work rates and bonuses, annual leave loadings, allowances, overtime, casual and shift work loadings and penalty rates with respect to unincorporated businesses.

The AIRC will not have the ability to bind new parties to transitional awards, but will retain a limited power to set aside or revoke a transitional award, eg. where it is satisfied that the award is obsolete or has ceased to operate.

Disputes: Disputes about the application of the award are to be dealt with under a DSP that is set out in the award. Disputes about the application of the award will remain an allowable matter, but be standardised using the model DSP. The model DSP will replace all award DSPs from the commencement of the new legislation.

The model DSP will also apply to disputes about the Fair Pay and Conditions Standard and the application of an AWA or a collective agreement where that agreement is lodged with the Office of the Employment Advocate without its own DSP (as a DSP is a compulsory content requirement).

Original state awards: The legislation refers to current state awards as 'notional agreements preserving State awards'. It is expected these awards will be subject to the rationalisation and simplification process which is the subject of a recommendation by the Award Review Taskforce. The situation with respect to a new business incorporated after the commencement of the WorkChoices legislation and current state award coverage is unclear.

In these circumstances, it is anticipated the employer will be able to make application to the AIRC for an appropriate award to be declared applicable to employees of the new business.

A 'notional agreement' (ie. original state award) will not apply automatically to a company which commences business after the operative date of WorkChoices legislation, as a notional agreement is a transitional arrangement and only applies to employers who were regulated by a state award before the WorkChoices legislation commenced.

Termination of employment

The AIRC's jurisdiction with respect to unlawful termination will remain unchanged. The AIRC will continue to conciliate where an employee alleges their employment has been terminated on prohibited grounds, including race, sex, colour, sexual preference or family responsibilities. The Commission will continue to be required to issue certificates where conciliation is unsuccessful. Such a certificate is a pre-requisite for the matter proceeding to court.

However, the AIRC will only be able to deal with unfair dismissal for businesses with more than 100 employees, and it will be restricted to employees engaged for at least six months. Claims cannot be brought for unfair dismissal where employment has been terminated by reason of the fact that the employer no longer requires the job to be done, eg. redundancy or due to 'operational requirements'.

Industrial action

The AIRC will continue to regulate protected industrial action.

For example, the AIRC will continue to have a procedural role in conferring protection on industrial action (through receiving notification of the bargaining period and by ordering and overseeing secret ballots). In addition, the AIRC will continue to be able to declare that industrial action is no longer protected by terminating or suspending bargaining periods.

The range of circumstances in which a bargaining period can be suspended will be increased. The AIRC will be able to make a Workplace Determination where a bargaining period has been terminated in the public interest , eg. where the action threatens life, personal safety, health or welfare of the population or to cause significant damage to the economy.

The AIRC will also retain its powers to issue orders to prevent or stop unprotected industrial action. However, legislation will require that the AIRC hear and determine an application for such an order in a maximum of 48 hours. If the AIRC cannot determine the application to stop or prevent industrial action in that time it will be required to issue an interim order, unless it is contrary to the public interest.

Right of entry

In relation to the right of entry into a workplace of union officials, the AIRC will have the power to revoke or suspend individual permits; revoke or impose conditions on the permits of an entire union or branch of a union where it is satisfied that the union or one of its officials has abused the system; and resolve disputes over right of entry.


Awards to be reviewed under WorkChoices legislation

Federal IR changes 2005


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