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Workplace & Employment
Key changes to Australian employment law
On 6 December 2022, the Fair Work Legislation Amendment (Secure Jobs Better Pay) Act 2022 received Royal Assent, amending the Fair Work Act 2009 (Cth). The key amendments to the Fair Work Act are as follows: 1. Casual Conversion – currently in effect Casual conversion is allowing casual employees to become employed on a permanent basis. It is available for an eligible casual employee, being one who: Has been employed for at least 12 months; Has worked regular pattern of hours during the last six months of employment; and Is able to continue working the regular pattern of hours as a full time or part time employee without significant changes. Employers must offer casual conversion within 21 days of an eligible employee’s 12 month work anniversary. This is an ongoing obligation, and employers must consider an employee’s eligibility each year to make the offer. If a casual employee requests casual conversion, employers must respond in writing by accepting or rejecting within 21 days. An employer must have reasonable grounds for rejecting a request, or not making a casual conversion offer. Employers must also provide casual employees with the ‘Casual Employment Information Statement’ in addition to the Fair Work Information Statement, at the commencement of employment. 2. Pay Secrecy Terms – currently in effect The Fair Work Act now gives employees the right to disclose their salary information. It also prohibits employers from entering into a contract (or other written agreement) with an employee which includes a term which prohibits an employee from disclosing their salary or other terms and conditions reasonably necessary to determine an employee’s salary. Any existing employment agreements which do include a pay secrecy term have no effect, and can no longer be enforced. 3. Prohibiting Workplace Sexual Harassment – effective 6 March 2023 The Fair Work Act will prohibit sexual harassment in connection with work. Employers will potentially be made liable for sexual harassment committed by an employee or agent in connection with work, unless they can prove they took all reasonable steps to prevent the sexual harassment. 4. Flexible Working Arrangements – effective 6 June 2023 The amendments allow pregnant employees and employees experiencing domestic violence to request flexible working arrangements. In addition to existing obligations on employers to provide reasons for refusing an employee’s request for flexible working arrangements, employers may only refuse a request for flexible work arrangements if they have: (a) Discussed the request with the employee;(b) Genuinely tried to reach an agreement with the employee about making changes; (c) Had regard to the consequences of refusal for the employee; and (d) The refusal is on reasonable business grounds. Employers must also set out the particular business ground that it relies on for refusing the request, and explain how those grounds apply to the request. The Fair Work Commission will now be able to hear and make orders about disputes regarding flexible workplace arrangement requests. 5. Fixed Term arrangements – effective 6 December 2023 The term of a fixed term employment contract must not exceed 2 years (including extensions). Fixed term contracts may not be extended more than once. Some fixed term contracts are excluded from this rule, e.g. those relating to casual employees, seasonal labour, specialised skill employment and high-income employees. From 6 December 2023, employers will need to give ‘Fixed Term Contract Information Statement’ prepared by the Fair Work Ombudsman. This has not yet been made available. Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.
Workplace & Employment
High Court Clarifies Definition of Casual Employee
As one of the most significant decisions by the High Court in 2021, the High Court has determined the meaning of a casual employee in Workpac Pty Ltd v Rossato [2021] HCA 23. Mr Rossato was employed as a production worker by Workpac’s labour-hire company under a series of six contracts, or assignments, to perform work for one of Workpac’s clients. While Mr Rossato was required to work regular and full-time hours according to a fixed pattern of work, Workpac treated Mr Rossato as a casual employee, such that Mr Rossato was not paid the leave or public holiday entitlements under the Fair Work Act 2009 (Cth) (the Act) and the enterprise agreement. The Court confirmed that the question of whether a person is a casual employee is to be determined by considering the express terms of a written employment contract, and not on the basis of any subsequent conduct of either party. To this extent, the court held any such commitment to further work must be contained in an enforceable agreement to be recognised. The High Court held that a casual employee is an employee who has no “firm advance commitment as to the duration of the employee’s employment or the days (or hours) the employee will work” and provides no reciprocal commitment to the employer. In considering the nature of the commitment, the court held that ‘the existence or otherwise of a “firm advanced commitment” must be for enforceable terms’, and should not be held to exist from expectations or understandings borne from the manner in which the parties have performed their agreement. The High Court held that a mere expectation of continuing employment on a regular and systematic basis is not sufficient for the purposes of the Act. Mr Rossato’s employment was expressly on an “assignment by assignment basis”. Mr Rossato was entitled to accept or reject any offer of an assignment, and at the completion of each assignment Workpac was under no obligation to offer further assignments. The High Court also held that it was not the role of the courts to “moderate a perceived unfairness resulting from a disparity in bargaining power between the parties”. In relation to the employment relationship, it should be noted that the High Court held in BP Refinery (Westernport) Pty Ltd v Shire of Hastings (1977) 180 CLR 266 that: 1. while mutual undertakings may not always be express, where there are express terms of the contract between the parties, they must be given effect unless they are contrary to statute; 2. if the mutual undertakings are said to be implied in what has been agreed, they cannot be inconsistent with the express terms of the contract; and 3. if the mutual undertakings are to be inferred from the conduct, then they may take effect as contractual variations. This decision by the High Court in Workpac v Rossato is important for both employers and employees as it reinforces the importance of specifying the terms of the contract in writing, taking into account the key features of the High Court’s decision. It is also important that casual contract terms and employer’s policies are carefully reviewed to ensure that they do not create any unintentional implied mutual obligations or variations inferred from the conduct. It is also worth noting that a new provision of s 66B of the Act has been introduced which requires employers to offer casual employees to become permanent employees if they have been employed for 12 months and have worked regular and systematic patterns in the last six months. Disclaimer: The contents of this publication are general in nature and do not constitute legal advice. The information may have been obtained from external sources and we do not guarantee the accuracy or currency of the information at the date of publication or in the future. Please obtain legal advice specific to your circumstances before taking any action on matters discussed in this publication.
Workplace & Employment
Modern Slavery Reporting Requirements
In Australia, the Modern Slavery Act 2018 commenced operation on 1 January 2019, creating reporting obligations for certain entities. The term modern slavery is used to describe situations where coercion, threats or deception are used to exploit victims and undermine or deprive them of their freedom. It describes serious exploitation and not substandard working conditions or the underpayment of workers. The Australian government, in support of UN Guiding Principles, aims to combat modern slavery in the Australian community and in the global supply chains of Australian goods and services. Who needs to report? Entities that have: Consolidated revenue of at least $100 million for the relevant reporting period (a financial year), and which Are Australian identities, or Undertake business in Australia in that financial year What do I need to report? The mandatory criterion are: The reporting entity’s structure, operations and supply chains; Modern slavery risks in the reporting entity’s operations and supply chains (including those of subsidiary entities); Actions taken (including by subsidiary entities) to assess and address those modern slavery risks, including due diligence and remediation processes; How the reporting entity assesses the effectiveness of actions taken; and The process of consultation with subsidiary entities in preparing the modern slavery statement. When do I need to report by? Affected entities must report in respect of the first full reporting period following commencement and must report within 6 months of that period ending. For example, the reporting period for entities with a 30 June year end will be 1 July 2021 to 30 June 2022, with reporting due by 31 December 2022. Further information Further information and links to the online registers can be found here: https://www.homeaffairs.gov.au/criminal-justice/Pages/modern-slavery.aspx Please contact H & H Lawyers for further legal advice for submitting a modern slavery report. [Disclaimer] The contents posted are general legal information, not legal advice, and the author and publisher have no legal responsibility for the contents. Each post is based on the law that was in force at the time of writing. Please consult a lawyer directly for accurate legal advice.
Workplace & Employment
Casual vs Permanent
On 20 May 2020, the Full Court of the Federal Court of Australia handed down its decision in WorkPac Pty Ltd v Rossato. The case centres around labour hire firm WorkPac, which employed Robert Rossato as a mine worker at two Queensland mines owned by Glencore. Mr Rossato was a casual employee, on rolling contracts, over a three-and-a-half-year period. As a casual, he was paid an extra 25 percent loading on top of his wage — which is the usual practice to make up for not being given benefits such as annual leave. The Full Federal Court dismissed WorkPac’s application for a declaration that Mr Rossato was a casual employee, instead finding that Mr Rossato was a permanent employee. It was found that because Mr Rossato's employment was "regular, certain, continuing, constant and predictable", and he was given rostered shifts well in advance, he was eligible to entitlements that full time employees receive under the National Employment Standards (NES) in the Fair Work Act 2009 (Cth) and the relevant Enterprise Agreement: being paid annual leave, paid personal/carer’s leave, paid compassionate leave, and payment for public holidays. This is an important decision for employers who engage casuals, whether directly or as a host employer. Pending any intervention by the Federal Government or appeal to the High Court, employers should now carefully review their casual employment arrangements, update the terms of their casual contracts, and revisit their arrangements with labour hire companies and their workers. In particular: • Employers should review their casual arrangements with a view to determining whether some other form of engagement is more appropriate – including part time and fixed term arrangements. • Assuming casual engagement is still appropriate, specific attention should be given to the employee’s written contract to ensure that the casual loading is a separately identifiable amount that is stated to be paid as a result of the employee not being entitled to NES or other entitlements peculiar to permanent employment. We also suggest a statement to the effect that if the employment is subsequently determined not to be casual employment, the employer is entitled to repayment of the casual loading. • Regular reviews of casual arrangements should be conducted – at least once every 12 months – to assess the likelihood of the employment being a “firm advance commitment” of employment. We can assist you if you have any questions about how the Workpac v Rossato decision may impact the work arrangements in your own organisation or more generally in relation to how you are employing or engaging your workforce.
Workplace & Employment
Unpaid internship and Fair Work Ombudsman
In May 2016, The Federal Circuit Court imposed a $272,850 penalty against Sydney-based media company AIMG BQ Pty Ltd to send it a “serious message” not to disguise employment relationships as unpaid internships. The Court handed down the penalty against the company following an investigation and legal action by the Fair Work Ombudsman. Judge Tom Altobelli also penalised the company director $8,160 over his failure to comply with a Notice to Produce document for Fair Work inspectors. Further, the Judge imposed a three-year injunction restraining the director from contravening workplace laws. AIMG BQ admitted in Court that it underpaid two event co-ordinators a total of $18,767 between October 2013 and June 2014. AIMG BQ required the student to do an ‘internship’ of 180 hours of productive work over a period of four months, with duties ranging from administration and office cleaning to event organising and magazine editing - before it started paying her wages. It was unlawful for the internship to be unpaid because the student was performing productive work that was not a formal part of her studies. After the internship period, AIMG BQ paid the student an unlawfully low flat rate of $50 a day, or just $6.56 an hour. In total, the student was underpaid $8,387. When is an internship legal? Internships and work experience placements are not unusual and are an important experience for young people seeking exposure to the industries in which they wish to be employed. These arrangements are legal, and minimum wage requirements will not apply as long as: the arrangement is a vocational placement required as part of an education or training course provided by an approved institution; or the person is not in an employment relationship with the host company. While each case will be different, whether an internship is actually an employment relationship will depend on a number of factors, including: whether the intern is doing productive work or just observing; how long the arrangement continues for; whether the work performed by the intern is similar to work performed by other paid employees; whether the work performed by the intern is work that the organisation needs to be done; whether the intern is required to come to the workplace for certain days and hours, as required by the organisation, or if they can nominate their own hours; and whether the intern is doing work that generates income for the organisation. Lessons for Employers Internships and unpaid work experience arrangements are a good way for employers to attract potential future hires and provide valuable industry exposure for young people. However, employers must take care to avoid creating an employment relationship. Employers should: ensure that any vocational placements are arranged through an approved institution such as a TAFE or University; limit the period of any unpaid internships to no more than a few weeks full time (or equivalent part time period); appropriately limit the kind of work that interns are permitted to perform – their tasks should be primarily of the “watch and learn” variety; and ensure that appropriate policies are in place detailing how interns should be treated. Generally, the unpaid work experience placement or internship is less likely to be classified as employment if they mainly benefit the intern, if the duration of the placement or experience is relatively short and if the intern is not expected or required to complete productive work. This particular case highlights the importance of using an intern agreement. As set out in this article, the consequences of getting it wrong can cause significant financial and reputational damage. H & H Lawyers can assist you with the classification of workers and the preparation of suitable documentation to mitigate any risks associated with engaging non-employee workers, including unpaid interns.
Workplace & Employment
Unfair dismissal - immediate termination
Q: I worked as a waiter at a restaurant for about two years. Yesterday, my employer suddenly said, "Did you steal cash from the cash register last night? Surveillance cameras caught you. You are fired. Get out now." I was fired without being given any opportunity to explain my situation. Is this an unfair dismissal? (waiter, 25-year-old male) A: In principle, if an employee commits a serious misconduct in connection with his or her job, the employer can dismiss the employee immediately without notice. However, it is sometimes difficult to determine what action would result in an immediate dismissal. Often issues arise when there is no evidence proving the serious misconduct, and for that reason, an employee sues for unfair dismissal. Such theft is a “serious misconduct” under the employment law, which can be justified as a reason for immediate dismissal. However, if the employee was falsely accused and fired unilaterally without being given the opportunity for clarification, this would likely be an unfair dismissal. In this case, the employer should show the CCTV footage to the employee, and give the employee the opportunity to explain his reasons. Once the theft is confirmed, then the employer needs to decide whether to terminate the employment contract. Furthermore, "serious misconduct" includes not only theft and embezzlement, but also fraud, violence in the workplace, drunkenness, use of illegal drugs, violation of work regulations, conduct that threatens the safety of the workplace and that significantly impair the productivity and reputation of the company. An example of a case of serious misconduct would be one in which an employee sends emails with abusive words to their colleagues and business partners. However, if your company is a “small business” with fewer than 15 employees, Australian employment law provides a provision that will make it easier to terminate employment contracts including the immediate dismissal of an employee due to a serious misconduct. It is presumed that for a small business, a serious misconduct has been committed if there is sufficient suspicion of illegal conduct. In one case there was a discussion over whether an employer sufficiently investigated the serious misconduct and whether the employee was given a reasonable opportunity to explain his situation. In that case, the court held that it was not an unfair dismissal on the grounds that a small business was not required to investigate an employee’s conduct as a big company would be. Moreover, in cases in which an employee was dismissed due to excessive use of illegal drugs outside of working hours, despite such dismissal being normally unfair, the dismissal was justified because of the employer’s small business status. In the current case, if the restaurant is a small business and the surveillance camera footage satisfies “sufficient suspicion”, it is likely that an immediate dismissal would be justified.