Parliament gives green light to FW Act changes

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Parliament gives green light to FW Act changes

Federal parliament has passed a raft of amendments to the Fair Work Act, including unpaid parental leave extensions and changes to industrial action and greenfield agreements.

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The Federal Parliament has finally passed a range of changes that have been ‘log jammed’ in the Senate for well over a year now.

First tabled in Parliament in February 2014, the Fair Work Amendment Bill 2014 was passed by the Senate in October 2015 and the House of Representatives last Wednesday 11 November 2015.

What does this mean for you and your business? 

Unpaid parental leave extensions


Employers will only be able to refuse an employee’s request for an extension of unpaid parental leave if the employee has been given a reasonable opportunity to discuss the request. 

This differs from the current situation where an employer may refuse the request for an extension on reasonable business grounds by simply notifying the employee in writing and providing reasons for the decision. Giving the employee a reasonable opportunity to discuss the request will operate in addition to these existing requirements. 

Industrial action


Employees will not be able to take industrial action unless bargaining for an enterprise agreement has actually commenced. This amendment overcomes the so called “strike first, talk later” situation that arose following the JJ Richards Case (where employees were permitted to take industrial action in order to pressure an employer into agreeing to bargain).

Under the amendments, for a protected action ballot order to be issued by the Commission, bargaining must have commenced either by the employer agreeing to bargain, or by a majority support determination being issued by the Commission.

Greenfields agreements


Employers who are bargaining for a proposed ‘greenfields agreement’ will have the option of applying to the Fair Work Commission for approval of the proposed enterprise agreement even where the relevant union involved in the bargaining does not consent. 

Employers will be able to make the application to the Commission unilaterally if no deal has been reached with the union within a ‘negotiating period’ of six months. 

What was left out?


The original draft of the Bill contained amendments relating to the payment of annual leave on termination as well as new rules relating to the accrual of annual leave while on workers compensation. 

The original amendments proposed to:
  • only require that annual leave be paid at the employee’s base rate of pay (unless an award specified otherwise); and 
  • confirm that annual leave would not accrue when an employee was on workers compensation. 
These proposals were not accepted by the Senate and did not make the final draft of the Bill as recently passed. 

This means that:
  • if an employee is entitled to annual leave loading when they take a period of leave, annual leave loading also needs to be paid on termination (as per the decision in Centennial Northern Mining Services Pty Limited v CFMEU [2015] FCAFC 100); and 
  • annual leave will continue accrue when an employee is on workers compensation if required by the relevant compensation law in each state or territory (as per the decision in Anglican Care v NSW Nurses and Midwives' Association [2015] FCAFC 81 5 June 2015).
Employers should note that the changes have not yet taken effect, but will likely do so in the coming weeks.
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