Fairness test legislation in Parliament


Fairness test legislation in Parliament

The amendments to the Workplace Relations Act designed to implement the 'fairness test' have been introduced into Federal Parliament.


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Source: Dick Grozier, Director of Industrial Relations, Australian Business Industrial

The amendments to the Workplace Relations Act designed to implement the 'fairness test' have been introduced into Federal Parliament.

On 18 June the Federal Government posted its proposed amendments to its fairness test bill [Workplace Relations Amendment (A Stronger Safety Net) Bill 2007]. They passed through the Senate today. These amendments deal with three main issues:

  1. workplace agreements which are lodged just before a transmission of business
  2. employees working in an industry/occupation usually regulated by state awards pre-Work Choices
  3. a new obligation for employers under WorkChoices to give employees a fact sheet

The Government also announced that it would accept part of Senator Fielding's amendments and extend the life of redundancy provisions.

None of this has passed through Parliament yet.

Transmission of business

The amendments provide that where the old employer has lodged a workplace agreement (collective or AWA) on or after May 7 and then the business, or part of it, transmits to a new employer before the agreement or variation has passed the fairness test, the fairness test is applied against the instrument(s) which applied to the old employer.

The old employer is required to advise the Workplace Authority that the agreement/variation which has not yet passed the fairness test is now binding on the new employer because of the transmission and provide details of the new employer. The Workplace Authority is required to forward the various documents concerning the fairness test to both the old and new employer.

Employees in State regulated industries/occupations

This amendment provides that where the employee(s) under the agreement work in an industry/occupation which was, pre-WorkChoices, usually regulated by a State award, the agreement is subject to the fairness test. This amendment applies when there is no NAPSA which applies to the employee(s) in question, because, for example, the employer commenced after 27 March 2006.

Where these circumstances apply, the Workplace Authority is to designate a Federal award for the purposes of the fairness test and the protected award conditions in that Federal award provide the comparator for the fairness test.

Employee fact sheet

These amendments require the Workplace Authority to gazette a 'Workplace Relations Fact Sheet' containing information about the:

  • Fair Pay and Conditions Standard
  • protected award conditions
  • fairness test
  • role of the Workplace Authority Director and Workplace Ombudsman

When the Fact Sheet has been gazetted, employers who are under WorkChoices will be required to take reasonable steps to give a new employee a copy of the Fact Sheet within seven days of commencement and existing employees a copy of the fact Sheet within three months of the gazettal. Failure to do so can give rise to a penalty of $110 (per employee).

Redundancy entitlements

The Government has announced that it will support extending the current protection of redundancy entitlements in terminated workplace agreements from 12 months to 24.

It is not clear whether this is confined to situations where employees move to a new employer on transmission or also where the workplace agreement has been unilaterally terminated and employees remain with their current employer. To date there are no bill provisions directed to the announcement, or any information about timing.

The Fact Sheet

As currently worded (and there is little chance of change, and no chance in the short term), the amendment provides an additional administrative burden for employers and potential for breach. It applies regardless of the nature of employment, be it fleeting or long term, casual or indefinite, and whether or not there is or would be any intention to enter into a workplace agreement with the employee.

The requirement also raises questions of proof (did the employer give the employee a copy of the Fact Sheet) and also, for employers whose status under WorkChoices is unclear, ambiguity about their obligation.

Where it is uncertain whether an employer is a constitutional corporation the ambiguity is not sensibly resolved by giving employees the Fact Sheet just to be on the safe side because the Fact Sheet deals with such matters as the Fair Pay and Conditions Standard which do not apply to non-WorkChoices employees, and which are often more generous than their actual entitlements.

The Bill

Details on the legislation.


New 'fairness test' and WorkChoices



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