Recent developments in employment law

The latest issues, decisions and proposed changes impacting business and workplace risk 6 min read

Get ready for Closing Loopholes (No. 2)

By Mikaela Heise and Anastasia Hatzisarantinos

The Fair Work Legislation Amendment (Closing Loopholes No. 2) Act 2024 received Royal Assent on 26 February 2024. A number of changes have already come into effect, with the remaining changes slated to commence later this year and in 2025. You can read our earlier Insight for further detail.

Some of the key changes that are yet to come into effect will commence as follows:

• On 26 August 2024, the right to disconnect will commence for non-small business employers. New definitions of 'employee', 'employer' and 'casual employee' will also come into effect and casual employees will be able to change to permanent employment under a new 'employee choice' process.
• From 1 November 2024, regulated labour hire arrangement orders can commence operation.
• From 26 February 2025, the Fair Work Commission will determine and replace the model flexibility, consultation and dispute resolution terms for enterprise agreements, taking into account certain matters prescribed by the Fair Work Act 2009 (Cth).
• On 26 August 2025, the right to disconnect will apply to small business employers.

Employers should start planning for these changes before they come into effect.

New multi-employer bargaining laws put to the test

By Sonia Millen, Sarah Lunny, Lawrence Mai and Anastasia Hatzisarantinos

Potential impact on the future direction of enterprise bargaining

The Association of Professional Engineers, Scientists and Managers, Australia (APESMA) has lodged an application in the Fair Work Commission (Commission) for a single interest employer authorisation,¹ which will test a critical part of the new multi-enterprise bargaining regime arising from the Secure Jobs, Better Pay reforms. Information about the Secure Jobs, Better Pay reforms to the multi-enterprise bargaining laws can be found in our previous Insight.

Key takeaways

The future direction of enterprise bargaining could be significantly influenced by the outcome of this case, which will shed light on how real or likely the prospect of multi-employer bargaining is for many employers.

The Commission's interpretation of critical aspects of the single-interest employer authorisation provisions will be a 'must watch', including the factors considered relevant by the Commission in determining whether:

• employers have 'clearly identifiable common interests';
• the making of the authorisation is 'not contrary to the public interest'; and
• the operations and business activities of the employers are 'reasonably comparable'.

The relevance of confidential information or commercially sensitive information to the determination of the above matters, and how that information will be handled, will also be important for employers to understand, particularly those operating in a highly competitive environment.

We will be monitoring this case closely and will provide further updates in due course.

Background

As at the date of this Insight, four employers in the mining industry are currently subject to APESMA's application (together, the Employers). The Australian Council of Trade Unions (ACTU) and Minerals Council of Australia have also been permitted to intervene, with the Commission noting the application will be a significant test of the new provisions.

Grounds and submissions

A critical threshold question in the case will be whether the Employers are 'common interest employers'. APESMA argues that the following factors weigh in favour of the 'common interest employers' test being satisfied:

• the commonality of operations and business activities of underground black coal mines in New South Wales;
• existence of identical regulations in respect of employment and WHS matters (including a common regulator);
• comparable licencing and operating requirements under the Mining Act 1992 (NSW) and Coal Industry Act 2001 (NSW); and
• the statutory presumption of common interest relating to employers with more than 50 employees.

Similarly, the ACTU suggested the test would be satisfied if each Employer would be affected by economic, regulatory or industrial movements within their subsector in the same or a similar manner.

The Employers have resisted APESMA's application by arguing the test is not satisfied because there are significant and fundamental differences between their respective operations and business activities, including due to the types of coal being supplied, the extraction methods used and the inherent differences in supplying coal to domestic and international markets.

Decision-makers in public entities need to consider human rights implications when issuing vaccine mandates

By Andrew Wydmanski and Olivia Brumm

As reported in our previous Insight, the Queensland Supreme Court recently ruled that COVID-19 vaccination directions imposed on employees of the Queensland Police Service (QPS) and the Queensland Ambulance Service (QAS) during the pandemic were unlawful and could not be enforced against those who had not complied with them.²

The decision has important implications for those entities subject to, and required to comply with, state and territory human rights laws (eg government-owned corporations and private companies performing functions of a public nature for the state or a public entity). It is also a reminder to all employers (within the public and private sector) to ensure evidence supporting a direction given to employees can be produced.

Key takeaways

• For public entities subject to the Human Rights Act 2019 (Qld) (HRA), decision-makers must ensure their proposed decision or action (such as vaccine mandate) is compatible with human rights, and that they have turned their mind to human rights considerations relevant to the proposed decision or action (as required by section 58 of the HRA). It is essential to have a robust decision-making framework that carefully documents what factors (including human rights considerations) are taken into account before the decision is made.
• For both public and private sector employers, supporting evidence will be needed to justify the basis on which a direction is made. If not, the direction may be at risk of being found by the court to be unreasonable and unenforceable against employees.

The decision

Parallel claims were brought against the Queensland Commissioner of Police and the Director General of Queensland Health in respect of COVID-19 vaccination mandates imposed on QPS and QAS staff.

With respect to the QPS vaccination directions, the court decided that the directions were unlawful because, in issuing them, the Police Commissioner had failed to properly consider the relevant human rights implications of the directions, thereby contravening s58 of the HRA. It followed that, given proper consideration was not given to human rights implications, the directions were unlawful and QPS personnel could not be disciplined for non-compliance with the directions.

For the similar QAS vaccination direction, the court decided that, while the Director General considered the human rights implications of the direction, QAS failed to establish it was a reasonable direction made pursuant to an implied contractual term, as there was no evidence about the nature or scope of the employment contracts for the court to assess the reasonableness of the direction. Accordingly, the direction had no legal effect due to its unreasonableness and could not be used to discipline unvaccinated QAS employees.

The court also considered whether the vaccination directions were themselves inherently unlawful under the HRA. It held the directions limited only the 'right not to be subjected to medical treatment without the person’s full, free and informed consent'. However, the court held the limitation was justified when balanced against the prevailing health emergency and ever-evolving knowledge about COVID-19 at the time the directions were made.

Union officials did not turn up for a cuppa: legal hair-splitting criticised in right of entry case

By Tegan Ayling and Virginia Dore

This case brought by the Construction, Forestry and Maritime Employees Union (CFMEU) alleged that union officials were delayed entry to a work site by two senior managers in breach of legislation.³ The officials were there to follow up on outstanding safety matters that had not been resolved during an inspection carried out a day earlier. The union succeeded.

Key takeaways

This case serves as a reminder that provisions related to right of entry on work sites should be construed in a practical and common sense way, so they can be implemented having regard to the 'daily realities' on work sites. Potential challenges to a right of entry should be carefully thought through, so that reasons that might be considered overly technical to dispute, delay or that deny the entry of permit holders are avoided.

Decision

The union alleged that JW Land Construction Pty Ltd (JW Land) had breached the Fair Work Act 2009 (Cth) (FW Act) as a result of two senior managers delaying the union officials entry to site.

The relevant right of entry provisions in the FW Act prohibit:

• intentionally hindering or obstructing a permit holder exercising their rights; and
• intentionally or recklessly giving the impression that doing a particular thing is authorised by the right of entry provisions if it is not.

The court decided that the two senior managers of JW Land had clearly breached the prohibitions and that '…while some infractions on building sites are very much like “beauty”—ie in the eye of the beholder—here the video footage…plainly showed obfuscation and misguided delay'. The senior managers had:

• insisted that the union officials refine the terms of the site inspection;
• indicated it was necessary for electrical inspectors to be present to accompany the union officials to inspect electrical boards prior to the safety inspection taking place; and
• indicated that a further inspection was not needed because the suspected contraventions had been 'closed out' the previous day.

The court noted in particular that entry by a different union official on the previous day, albeit lengthy, had not been challenged and there was to be a follow-up. The inspection the next day, which was based on the same or similar facts and circumstances, should have been equally unchallenged and much quicker. It was enough that the relevant union official on the day in question had formed his reasonable suspicion based on the information provided to him by the union official who had inspected a day earlier. JW Land was ultimately liable for the contraventions by the two senior managers.

Update on industrial manslaughter

By Andrew Wydmanski, Courtney Ferguson and Steve Hatzipavlis

We recently reported on the introduction of a new industrial manslaughter offence under the federal work health and safety legislation as part of the Fair Work Legislation Amendment (Closing Loopholes) Act 2023 (Cth), which you can view here.

In this Insight, we reflect on the steps employers could consider taking to create a safer workplace in light of a recent case in Victoria and proposed changes to the law in New South Wales.

Key takeaways

• An industrial manslaughter offence has been introduced to federal work health and safety laws, with maximum penalties of up to $18 million, or 25 years' imprisonment. Maximum penalties for other offences under federal work health and safety laws have also increased.
• Victoria has seen its first convictions under 'workplace manslaughter' provisions introduced in July 2020 against stonemasonry company LH Holding Management Pty Ltd and its sole director, after a 25 year-old worker died in a forklift incident. A WorkSafe investigation found it had been reasonably practicable for the company to ensure the forklift was operated properly to reduce the risk of serious injury or death. As a result:
  • the company was convicted and fined $1.3 million;
  • the sole director was also convicted and placed on a two-year Community Corrections Order to complete 200 hours of unpaid community work and a forklift operation course; and
  • the company and the director were ordered to pay $120,00 in compensation to the worker's family for pain and suffering.
• The NSW Government is currently considering submissions on its proposal to introduce laws in addition to the already existing Category 1 offences (gross negligence or reckless conduct that exposes an individual to a risk of death or serious injury or illness) by creating a new industrial manslaughter offence. Consultation on the proposal ended on 18 March 2024, with legislation expected after the review period.

What should employers do?

Employers should review the adequacy and effectiveness of their WHS management systems and controls, including by:

• ensuring that managers and employees are properly trained to identify risks and on appropriate safety procedures, particularly in the use of plant and equipment;
• ensuring there are effective communication systems in place between all individuals engaging in workplace activities that present a risk to safety;
• ensuring that directors and officers are trained on their due diligence obligations under WHS law, and can demonstrate that they are discharging those obligations; and
• ensuring that leaders are setting the tone of a proactive and strong safety culture in the organisation.

Insights from first WGEA report

By Mikaela Heise and Alana Perna

Off the back of changes to the Workplace Gender Equality Agency's (WGEA) reporting requirements under the Workplace Gender Equality Act 2012 (Cth) (WGE Act) in 2023, WGEA has, for the first time, published information on the gender pay gaps of individual private sector employers. 

Key takeaways

• With gender pay gap information publicly available, employers can now expect more pressure from employees, employee representatives and stakeholders to take meaningful action to close gender pay gaps within their organisation.
• Employers should be aware of, and ensure compliance with, the additional obligations that commenced on 1 April 2024.

Background

Previously, the gender pay gaps of individual employers were provided to WGEA on a confidential basis, which would then inform WGEA's industry-level reports on gender pay gaps. To speed up closing the gender pay gap, changes to the WGEA Act now require WGEA to publicly report on the gender pay gaps of individual employers.

In its first report, WGEA published the median gender pay gaps of almost 5,000 private-sector employers with 100 or more employees, revealing:

• a national median remuneration gender pay gap of 19%, meaning the median of what a woman is paid is $18,462 less than the median of what a man is paid; and
• that 50% of employers have a gender pay gap of over 9.1%.

Additional obligations on employers came into effect on 1 April 2024, including requirements:

• for employers to provide additional data to WGEA, including information:
  • in relation to employee age, primary workplace location and remuneration for chief executive officers, heads of business and casual managers; and
  • around sexual harassment, harassment on the ground of sex and discrimination.
• for large employers with 500 or more employees to have a policy or strategy for all six gender equality indicators (the gender equality indicators can be found here).

Record-keeping obligations in the spotlight

By Anthony Hallal, Eden Sweeney and Ruby Evans

Two recent cases have highlighted the consequences for employers and individuals for failing to make and maintain proper employee records as required by the Fair Work Act (2009) (the Act) and the Fair Work Regulations 2009 (Cth) (Regulations).

Key takeaways

• No obligations under the Act, including those that might appear merely administrative, should be disregarded by employers. Even administrative breaches of the Act may be taken seriously by the regulator, especially if it is in combination with other breaches such as underpayments, and may result in significant penalties.
• These cases also serve as a reminder that individuals can also have significant penalties ordered against them if they are involved in record-keeping breaches.

Background

Under section 535 of the Act, employers have an obligation to make, and keep for seven years, employee records relating to a range of matters including pay, overtime, leave and superannuation contributions.

If an employer fails to comply with these record-keeping requirements, it will bear the burden of disproving any allegations of further breaches of civil remedy provisions, such as when it is claimed they have underpaid their employees or not provided leave entitlements.

Decisions

In Fair Work Ombudsman v J.D. Chapel Nominees Pty Ltd (in liq) [2024] FedCFamC2G 85, an owner and director of a group of bars was fined $41,368 for his failure to keep employee records that showed:

• the hours worked by casual or irregular part-time employees; and
• the employees' entitlements to loadings, allowances or penalty rates.

The general manager of the bars was also fined $26,893 for his role in the failure to keep the employee records. As the person responsible for the day-to-day management of the bars, the general manager was considered to have had a 'practical connection' to the business' failure to make and keep the required records.

In her written submissions, the Fair Work Ombudsman described an employer's record-keeping obligations as 'the bedrock of compliance'. A failure to keep employee records was considered a particularly serious breach of the Act because a lack of records could effectively mask other contraventions and make it difficult for the Fair Work Ombudsman to properly investigate an employer's compliance with other parts of the Act, undermining the workplace regime as a whole. A significant factor in the penalty awarded was the need to ensure compliance with the record-keeping obligations generally by employers, as well as the fact that the contraventions were deliberate.

Another recent case, Scarati v Republic of Italy (No 3) FCA 55, serves as a further reminder that:

• employee records must be kept in English, as required by the Regulations;
• if an employee or former employee asks to see their own records, an employer must make them available, in accordance with the Regulations; and
• a failure to comply with either of these requirements by employers may result in pecuniary penalties being awarded against employers in proceedings.