The fairness test – passes through Parliament and a policy guide released.
There have been some new developments in relation to the Federal Government’s fairness test.
1) The fairness test legislation [also known as the Workplace Relations Amendment (A Stronger Safety Net) Bill 2007 (Cth)] passed
though Parliament in late June with some amendments made in the Senate.
2) A Fairness Test Policy Guide has been released.
The fairness test legislation and its amendments.
The test passed through Parliament on 20 June 2007. As stated in our last newsletter, the fairness test involved compensating employees that trade off certain conditions in their employment contracts. It is expected that in most circumstances, fair compensation will be provided in the way of a higher hourly rate of pay.
There are certain minimum standards enforced by this test such as
– Minimum wages;
– The 38 hour week (plus reasonable additional hours);
– 4 weeks annual leave;
– 10 days paid personal leave such as sick leave and carers leave; and
– 52 weeks unpaid parental leave.
These are conditions as set out in the Australian Fair Pay and Conditions standard. They are unable to be traded for compensation. Then there are the protected award conditions, will not be mandated in agreements, however under the new legislation, they will be able to be traded for adequate compensation. They are
– Penalty rates;
– Shift and overtime loadings;
– Monetary allowances;
– Annual leave loadings;
– Public Holidays;
– Rest breaks; and
– Incentive based payments and bonuses.
The legislation also established two new bodies known as the Workplace Authority and the Workplace Ombudsman. These are to replace the Office of the Employment Advocate and the Office of Workplace Services. They are the same bodies, just re – named.
The Senate included a number of amendments when the bill was passed. The amendment provisions include:
• Enabling the Workplace Authority to designate a federal award in order to apply the fairness test to an agreement
where no award applies but where the relevant work or industry was – before Workchoices – usually covered by a state award.
• Extending the period for which any redundancy provisions will apply to the new employer following a transmission of business, from 12 months to 24 months.
• Requiring a previous employer in a transmission of business to take reasonable steps to notify the Workplace Authority that an agreement, which has not yet been assessed under the fairness test is now binding on the ‘new’ employer.
• Requiring employers to provide all new and existing employees with a “Workplace Relations Fact Sheet.” More information on the fact sheet is provided in the next article.
• Specifying the particular information the Workplace Authority must provide to parties when applying the fairness test.