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Fair Work Act 2009
Friday 26th June 2009, 6:53PM
What’s New? Fair Work Act 2009 (Act)
From 1 July 2009 the Act will impact upon employee representation, employment arrangements and costs of most employers – small, medium & large. Those who do not understand and address the implications for their business may be in for a rude shock. Mandatory National Employment Standards (NES) will have widespread application. The role and function of participants as well as the collective bargaining, dispute resolution and employment termination environment will change…MORE?
Most of the changes under the Act including National Employment Standards (NES) will have application from 1 July 2009 with new modernized awards being phased in from 1 January 2010.
NES covering leave, holidays, flexibility, hours and termination will become mandatory for most common law employment contracts as well as new agreements and awards. They may or may not have application to existing operative agreements and awards. NES will in most cases increase employment costs. There may also be opportunities to address productivity and efficiency.
The 2010 new awards will replace existing state and federal awards. The objectives include simplification, establishment of a safety net (NES), promotion of economic and business sustainability as well as supporting collective enterprise bargaining. They will establish or underpin employment terms and conditions for employees of most of the industries across the nation. Further employment cost and coverage implications will need to be assessed by employers having regard to relevant terms and conditions of employment. Compliance of new awards and other industrial instruments will be enforced by the Office of Fair Work Ombudsman.
No new Australian Workplace Agreements (individual) will be made. New awards and/or agreements may have application to new and existing common law contracts of employment. Opting out may not be an option. There will be an increased focus on enterprise collective agreements involving bargaining agent (unions in most cases) and potentially increased involvement of a third party – Fair Work Australia (FWA). New agreements are expected to be assessed at a standard above the “no disadvantage test”. Thus terms and conditions overall will likely be above award terms and conditions and employers will need to consider their bargaining capacity, cost constraints and opportunities for improvements in productivity and efficiency.
The participants will be required to bargain in good faith. This is likely to be a factual assessment of actions including meetings, disclosures, responses and conduct. This will require employers to plan and carefully document how they participate in the process in accordance with the Act.
The option of protected industrial action will continue to be available to both parties though FWA may have more scope to assist the parties as well as power to issue orders and injunctions in certain circumstances. This may not prevent protected industrial action so careful consideration of a bargaining strategy and mitigation against protected industrial action may assist.
FWA scope in respect of a range of other matters including anti discrimination, OH&S, unlawful termination and unfair dismissal may also be broader under the Act. Employers who recognize the change and adopt pro active measures may be better placed to eliminate or mitigate against such risks as well as their associated relationship and cost implications. Some employers may position to benefit from the change.
Critically, the working relationship between employers and their people will significantly influence the outcomes for the business. Such relationships may commence and evolve with sound Human Resource procedure, policy and practice. Do you have sound working relationships and how will your business address the change internally and externally? How does the Act impact upon your business now and your strategic plans over the next one to three years?
If you would like to take a positive position in respect of the change and assess your human resource and recruitment requirements then call us to arrange a free initial consultation.