WorkChoices rules on leave, redundancy and stand-downs to change

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WorkChoices rules on leave, redundancy and stand-downs to change

The Federal Government will introduce significant changes to sections of the WorkChoices legislation relating to redundancy, accrual of personal/carer's leave, the right to stand down employees and record keeping.

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The Federal Government will introduce significant changes to sections of the WorkChoices legislation relating to redundancy, accrual of personal/carer's leave, the right to stand down employees and record keeping.

Main changes proposed

The main changes to the way WorkChoices currently functions are:

  • Redundancy entitlements under an agreement will continue to operate for 12 months after its termination, unless it is replaced by a new agreement
  • Overtime will not be part of the accrual of annual leave, which will only be based on ordinary time - as has been the case prior to WorkChoices
  • Employers will have a 'default right' to stand down employees if work was not available due to circumstances beyond their control (such as a natural disaster or industrial action)
  • Accrued personal/carer's leave can be cashed out provided at least 15 days still remains available
  • Records for hours worked by employers will only need to be kept where they are entitled to overtime or penalty rates, however payslip and superannuation records will still be required

Assisting Workplace Relations Minister, Joe Hockey, said in Melbourne today that the changes would be introduced by regulation as soon as possible, depending on parliamentary drafting constraints, but he hoped before Christmas.

'Not exact science'

He defended the need for the changes, saying the parliamentary drafting process was 'not an exact science' and 'unintended consequences' would inevitably arise.

The Minister for Workplace Relations, Kevin Andrews, said in a statement today that the amendments, which involve changes to the Act as will as the regulations, were in response to 'monitoring of the legislation'.

Heather Ridout, Chief Executive, Australian Industry Group (AiG), said the hours of work record-keeping requirements have been 'significantly relaxed' as sought by her organisation.

Business not compliant

She said the provisions for personal/carer's leave and the inclusion of overtime in the accrual of annual leave were such that 'it's likely that the majority of businesses have not been compliant with the WorkChoices legislation given problems which existed'.

The changes to protection of redundancy entitlements appear to be at least partially in response to the situation at car parts manufacturer Tristar where the employer has applied to the AIRC to terminate an agreement under which about 60 surviving workers are entitled to hundreds of thousands of dollars in agreement-based redundancy payments.

If the agreement is terminated the employees revert to award-based redundancy entitlements of no more than 12 weeks' pay.

Under pressure

The Federal Government has been under pressure from the ALP in Parliament to state whether it will protect the interests of the workers.

Unions have expressed concern that if the Tristar workers lose their redundancy entitlements other companies will follow the same pattern.

Under the changes flagged by Andrews employees will have to be notified by their employers that their redundancy entitlements continue after termination.

The changes to accrual of annual leave have been made following expressions of concern from employers that the WorkChoices Act could be interpreted to read that overtime had to be taken into account as well as the 38 hours per week standard.

Unintended consequence

'This was an unintended consequence of the way the accrual rule was drafted,' Andrews said.

He said the proposed amendment entitles employees to payment of personal/carer's leave or compassionate leave at the employee's basic rate of pay. This is the same rule as for annual leave. A similar payment rule applies to leave that is taken where a pregnant employee is unable to be transferred to a safe job.

Regarding the right to stand down employees, Andrews said such a provision will now be included in the Act.

Stand-down rights

'This provision would apply where an employer does not otherwise have (through an award, agreement or contract) an automatic right to stand an employee down, where work is unavailable due to factors outside the employer's control,' Andrews said.

He said that at common law, employers do not have the right to stand down an employee, even where work is unavailable due to factors outside the employer's control (eg a natural disaster or industrial action).

Andrews said any stand down right must come from a workplace agreement, employment contract, industrial instrument, or legislation.

'In the absence of a stand down right, an employer will usually have to choose between continuing to pay the employee (despite lack of work to do), or dismissing the employee,' he said.

Full text

The full text of Andrews statement on the WorkChoices changes.

Related

Unions fear company is stalling so it can shred entitlements

Wages and Hours - employer questions about WorkChoices

Annual leave and personal/carer's leave - employer questions about WorkChoices

Keeping employment-related records generally

Termination of agreement; Stand-down - employer questions about WorkChoices

Termination of expired agreement against public interest

  

 

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