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Proposed Industrial Relations Reforms

In early December 2020, the Commonwealth Government introduced a Bill to reform Australia’s Industrial Relations system – the Fair Work Act (Supporting Australia’s Jobs and Economic Recovery) Bill 2020.

The more significant changes being proposed are summarised below:

  • A statutory definition of casual employee – currently there is no definition of ‘casual employee’ in the Fair Work Act 2009 (Cth) (FW Act).  Under this proposal, if an employer makes an offer of employment to an employee where there is no firm advance commitment to continuing and indefinite work according to an agreed pattern of work, and the employee accepts such an offer, they will be a casual employee.
  • Casual conversion – a right to be offered casual conversion will be included in the National Employment Standards (NES).  This is already a common feature of some modern awards, however, this right would extend to all NES employees and create an obligation on employers to make the offer where casuals who have over the last six months of a 12-month period “…worked a regular pattern of hours on an ongoing basis which, without significant adjustment, the employee could continue to work as a full-time or part-time employee.”  Employers will have to agree to such a request unless they have reasonable grounds not to. Employers will also be required to provide casual employees with a “Casual Employee Information Sheet” (which would be prepared by the Fair Work Ombudsman) when they commence employment.
  • No “double dipping” – this addresses an issue which has arisen in recent court cases. It provides that where a casual employee is “misclassified” as such and a court finds the employee is owed entitlements because they perform regular, permanent work, the casual loading already paid to compensate for those entitlements (such as annual leave and personal/carer’s leave), will be deducted from the employer’s liability.
  • Increased flexibility of part-time work under Award and Extension of JobKeeper flexibilities
  • Jail time for serious wage theft
  • Enterprise Agreements – the better off overall test (BOOT) is used by the Fair Work Commission (FWC) to assess whether employees are better off under a proposed enterprise agreement or the relevant modern award. This reform would allow the BOOT to be relaxed. The FWC would be able to approve enterprise agreements under which some employees may be disadvantaged when compared with the relevant modern award.

To view the Bill in full, click here.

To view a range of fact sheets on the industrial relations reform, click here.

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