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HG Alert: Recent changes to the Fair Work Act - things employers should be doing now to accommodate them - 26 August 2013

Several important changes were made to the Fair Work Act with effect from 1 July 2013.  Others have been legislated to take effect from 1 January 2014.  As a result, employers wanting to keep up with (or ahead of!) their statutory obligations should be looking now at their policies and processes relating to a range of matters.

Key points

  • The National Employment Standards have been changed, effective from 1 July, in relation to various parental leave entitlements and requests for flexible work arrangements.
  • Other changes will commence from 1 January 2014.  These include the commencement of a new jurisdiction for the Fair Work Commission (FWC) to make orders in relation to workplace bullying disputes.
  • Employers should familiarise themselves with both the new and incoming changes, because most workplaces will have to make some policy/process adjustments – including training of staff – to accommodate them.
  • The new FWC bullying jurisdiction will add to what is already a hotbed of potential risk for employers in relation to workplace bullying.  Employers who do nothing, or not enough, to manage that exposure could find themselves exposed to significant business disruption and cost if bullying occurs in their workplace.

Requests for Flexible Work Arrangements

Prior to 1 July 2013, the only people who could request their employer for a change in working arrangements (or for a “flexible working arrangement”) were parents or carers of children under school age, or, children under 18 with a disability.

The group of people eligible to request a flexible working arrangement has now been expanded – with effect from 1 July 2013 – to include employees who:

  • are carers of children who are of school age or younger;
  • are carers of persons who are disabled, chronically or terminally ill, mentally ill or frail and aged;
  • themselves have a disability;
  • are 55 or over;
  • are victims of domestic violence;
  • are caring or supporting a member of their family or household because the other person is themselves a victim of domestic violence.

The right of parents and carers with childcare responsibilities, or those returning to work after taking a period of parental leave, to request to work part-time has also been expressly recognised “to avoid doubt”.

As to what else might constitute a “flexible working arrangement” continues to be left open.

Employers will still be entitled to refuse a request for flexible working arrangement based on "reasonable business grounds”. A non-exhaustive list of what this may entail has been provided in the legislation, including:

  • excessive cost to accommodate the request;
  • lack of capacity to reorganise work arrangements;
  • a significant loss of efficiency and productivity.

The changes are reflected in the latest version of the Fair Work Information Statement to be given to new employees, available here

The issue of how employees provide evidence of their entitlement to request a flexible working arrangement has raised some concern, particularly for employees who apply on the ground of being a carer or because a family member is suffering from domestic violence. Some employees may feel that the provision of that information is humiliating or undignified. Employers will have to make it clear to employees that their information will be handled sensitively and confidentially (as indeed it should be under privacy legislation).

We suggest that employers document a comprehensive intake process for flexible work requests.  In our experience this will dramatically assist compliance and minimise the prospect for uncertainty and disputes.

Parental and pregnancy related leave entitlements

Employee entitlements under the National Employment Standards have been expanded from 1 July 2013 in respect of pregnancy related and parental leave in the following respects:

  • Dads and partners of primary carers are now entitled to take up to eight weeks concurrent unpaid parental leave, up from three weeks.  In addition, they are entitled to take the leave in separate periods of, at least, two weeks within twelve months of the birth/adoption.
  • Any period of special maternity leave – usually taken on account of pregnancy related illness – will no longer be offset against any unpaid parental leave to which the employee is otherwise entitled.
  • All pregnant employees with particular health issues now have the right to request they be transferred to a safe job on account of their pregnancy, regardless of their length of service.  Eligibility was previously restricted to persons with, at least, 12 months’ prior continuous service.

Parental and pregnancy related leave entitlements are not straightforward.  The challenge for employers is to document a system for their workers that, so far as possible, reflects the underlying statutory safety net and is easy for all stakeholders to understand and apply.

Bullying

From 1 January 2014 a worker who “reasonably believes” they have been bullied in the workplace will be able to apply to the Fair Work Commission and seek orders against the perpetrator and their employer requiring them to stop the bullying. 

Under this novel anti-bullying complaints regime, a worker will be considered to have been bullied at work if an individual or group of individuals:

“repeatedly behaves unreasonably towards the worker… and that behaviour creates a risk to health and safety”. 

“Reasonable management action carried out in a reasonable manner” will not amount to conduct in respect of which an application might be made.  However that formula, which is common in worker’s compensation legislation across Australia, is almost certain to result in arguments about whether particular behaviour did or did not amount to bullying.

The protections will extend to “workers” including:

  • employees;
  • contractors and sub-contractors;
  • outworkers;
  • apprentices and trainees;
  • work experience students; and
  • volunteers.

Where the Commission is satisfied that bullying has occurred and there is a risk of further occurrences, the Commission will be able to make “any order it considers appropriate” – except an order requiring payment of compensation – to stop the bullying.

The bite in such an order is that any breach of it might attract a civil penalty up to $51,000 for corporate offenders and up to $10,200 for individual offenders.  But there will also be the direct and indirect costs of preparing for and participating in the initial application, in yet another formal channel for workers to complain.

When considering an appropriate order to make, the Commission must have regard, among anything else it considers to be relevant, to any attempts made to resolve the complaint at the workplace level. The Commission will almost certainly be interested to see if the worker has firstly tried to resolve their issues through internal mechanisms, such as under an employer’s grievance and workplace harassment policies.  

The Explanatory Memorandum to the legislation provides that “Orders will not necessarily be limited to apply only to the employer and the worker who is bullied, but could also apply to others such as co-workers and visitors to the workplace”. In certain circumstances, the tribunal may consider ordering that the perpetrator and the victim should be separated from one another at work. This may throw up difficult issues for an employer in respect of relocating employees and changing working arrangements. Any orders made in relation to ‘visitors’ have the potential to make things very tricky for businesses indeed, particularly if the visitor happens to be a high profile supplier or client.

Bullying has become, and will continue to be, a difficult area for employers to manage their increasing obligations.  In future workplace bullying complaints might lead to:

  • liability under stop orders made by the Fair Work Commission;
  • civil liability to penalties for breach of those orders;
  • civil liability for penalties and compensation in proceedings under the existing mechanisms of the Fair Work Act relating to “workplace rights” and “adverse action”;
  • worker’s compensation disputes and litigation;
  • criminal liability under workplace health and safety laws;
  • civil liability for damages for personal injury.

A recent example of the latter occurred in the decision of the Victorian Supreme Court in Swan v Monash Law Book Co-operative [2013] VSC 326, which saw an employer’s inaction in dealing with workplace bullying resulting in an award of damages exceeding $600,000.

For some time, Safe Work Australia has been working on a Code of Practice relating to management of the risk of workplace bullying: Preventing and Responding to Workplace Bullying.  Employers should familiarise themselves with the draft Code and keep abreast of its development.  In the meantime, all Australian States and Territories have published guidance material upon the subject, to which you should refer in jurisdictions in which you operate.

Other changes

Among other incoming changes to be effective from 1 January 2014, are those relating to:

  • the mandatory content requirements for modern awards and enterprise agreements; and
  • union rights of entry.

From next year, modern awards and new enterprise agreements will be required to contain provisions to ensure that employers genuinely consult with employees about changes to their regular roster or ordinary hours of work, with representation if they choose for the purposes of that consultation.  These requirements will be additional to the current consultation requirements applicable to “major workplace change”.

In our view these requirements are reflective of current best practice in any event.  Employers who change hours without, or without adequate, consultation or attempt to do so already run the gauntlet of disputation on a number of fronts including, for example, breaching the requirements of the National Employment Standards relating to working hours and the general protections provisions.  For an example, see our prior alerts relating to the decisions in Brown v. Premier Pet.

The changes around union rights of entry – again, to become applicable in the New Year – contain two key elements:

  • Where agreement cannot be reached between an employer and a union permit holder about a suitable location for discussions with potential members, the default position will be that the discussions will take place in an area ordinarily used for meal or rest breaks.  In practice this will mean that permit entry holders will be able to insist that discussions take place in lunch/break rooms; and
  • Employers operating a business enterprise in a remote location may be required – subject to various conditions – to assist with providing accommodation and transport for union officials who hold entry permits and seek to exercise rights of entry.  In both cases the employer will be entitled to charge a fee, provided that it does not exceed what is necessary to cover the cost of accommodation/transport provided.

Again, employers with unionised workforces or with businesses in which unions are likely to try to organise, should already have in place some form of union engagement plan touching at a basic level upon union exercise of their rights of entry.  However, these may need some adjustment for the incoming changes.

For more information, please contact HopgoodGanim’s Industrial and Employment Law team.

With offices in Brisbane and Perth, HopgoodGanim offers commercially-focused legal advice, coupled with reliable and responsive service to clients throughout Australia and across international borders.
 

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