The Guardian 19 March, 2008
National Employment Standard:
A "safety net" but where are the unions?
Anna Pha
During the federal election campaign, Labor emphasised that Australian Workplace Agreements (AWAs) would be abolished, and that the only form of individual contract permitted would be common law contracts. It also promised to introduce a new "safety net". It has already presented to Parliament a bill providing its transition mechanism for the abolition of AWAs over a number of years.
Under WorkChoices, employers used AWAs and non-union collective agreements to undermine award conditions. After all, that was the purpose of the legislation. Even the so-called "protected by law" award conditions could be wiped out by a simple clause in the AWA saying they did not apply. These conditions covered public holidays, rest breaks (including meal breaks), incentive-based payments and bonuses, annual leave loadings, allowances, penalty rates and shift/overtime loadings.
Many employers took advantage of the opportunity and enforced AWAs that wiped out gains that had been won over more than a century of struggle. Every AWA removed or reduced one or more of the Howard government’s five "protected by law" conditions.
The Howard government in its dying days brought in a "fairness test" in a futile attempt to lift its popularity as the conditions of workers on AWAs were haemorrhaging. All the "fairness test" did was create a backlog of paperwork at the Workplace Authority as employers decided it was business as usual.
Labor’s new "safety net" has two components. The first is the 10 legislated minimum entitlements, the National Employment Standard (NES). This applies to all employees, regardless of whether they are hired on a collective agreement, a new transitional individual contract or an individual contract under common law.
The other component of the safety net is a system of "modern simple awards" that are industry or occupation based. They provided legally binding protection for employees who earn less than $100,000 per annum. Existing awards will be rationalised — many wiped, some merged and the content restricted to 10 allowable matters plus industry and occupation specific arrangements applying to the 10 conditions in the NES.
The discussion paper on the proposed NES gives detailed explanations of many of the terms used in the specification of entitlements. It also poses questions seeking responses to them in the form of submissions to the Department of Education, Employment and Workplace Relations (DEEWR). Unions, other organisations and individuals are free to make submissions.
Many of these reflect long-held community standards and practices. In some instances they suffer more from what is omitted rather than what is proposed such the one on parental leave where nothing is said about paid parental leave. Some appear to give workers considerable protection, but on closer examination additional clauses leave a great deal to the mercy of the employer.
Throughout the document, the terms "employer" and "employee" are used, without reference to trade unions. There is a strong focus on decision-making through "discussion" between the employer and employee in the workplace.
The term "employee" also has another significance, in that it technically excludes contractors — a big issue in industries such as building and construction. What protection, if any, will apply to contractors is still to be revealed. Existing legislation leaves them with few rights to anything. Likewise casuals are excluded from most of the safety net provisions.
The following are the ten NES legislated minimum conditions:
1. Maximum weekly hours of work
Maximum hours must not exceed 38 hours in a week. This provision is qualified — effectively allowing employers a way out of the "must not":
an employer may require an employee to work reasonable additional hours in the week;
an employee may refuse to work additional hours if the hours are unreasonable;
the possibility of averaging of hours.
The question of what is "reasonable or unreasonable" is raised along with possible criteria such as the health and safety or working the above mentioned additional hours, personal circumstances, needs of the employer, whether there is an entitlement to some form of compensation such as overtime payments or penalty rates for working the additional time.
The Standard does not deal with the averaging of hours (eg 38 per week over the year). This would be left to the award to specify.
The question is posed: "Should the maximum hours NES expressly provide that an employer will not be in breach of the NES where an employee works additional hours of their own volition?"
This begs the question of which workers feel secure enough to refuse to work additional hours "of their own volition". It also leaves open the temptation of workers to grab as many hours as they can for the extra money.
This is a serious issue, where in some industries workers are doing as many as 80 hours (no, that is not a misprint) per week, and accidents are occurring as a result of fatigue. In construction and mining the12-hour shifts, 6- or 7-day working weeks are becoming more common, particularly in Western Australia. The workers do it as they make a killing with penalty rates, but it could also be killing them.
The discussion paper also raises the question of how many additional hours would be reasonable for part-time workers. What about pieceworkers who are paid according to the volume of work carried out?
2. Requests by parents for flexible working arrangements
The second NES provides for employees attempting to juggle work and family responsibilities to be able to request flexible working arrangements when a child is not old enough to attend school. "An employer can only refuse a request on reasonable business grounds."
The request will be made in writing, and the matter dealt with in the enterprise. The government’s aim is to encourage discussion between the parties (employer and employees — there is no mention of trade unions), and have them reach an arrangement that balances business and personal requirements. Fair Work Australia (replacing the Industrial Relations Commission) will not be able to impose the requested working arrangements on an employer. There is no role for the "umpire" in the process.
Again questions are raised about the meaning of "reasonable business demands" and examples are given of possible flexible arrangements — eg different starting and finishing times.
3. Parental leave (and related entitlements)
Each parent will be entitled to up to 12 months unpaid leave each for the birth of a child or adoption of a child. Up to three weeks of this leave could be concurrent. The draft provision specifies the terms for return to work after parental leave, including an entitlement to return to the position and hours of work held prior to leave or a reduction in hours during pregnancy.
The paper raises a host of issues such as transfer to a safe job during pregnancy, what happens if such a transfer is not possible, refusal of employer for any requested extra leave.
There are other related entitlements such as special maternity leave and pre-adoption leave. Again important questions are raised about these.
Many of the proposals are positive, but much will depend on the final detail and what additional provisions are contained in awards.
It is, however, extremely disappointing that there is no provision for paid maternity leave — not even a minimum of paid leave — a standard provided in most industrialised countries. This is an important issue worth taking up in submissions to the government.
4. Annual leave
Paid annual leave is four weeks, with a fifth week for certain types of "shift workers" as designated in awards. Leave is paid at the "base rate of pay" for "ordinary hours of work" as specified in the award. For many workers who receive allowances, bonuses, penalty rates, overtime payments, etc, this could mean a substantial reduction in income.
The NES does not include any reference to leave loading, which most workers were entitled to until recently. The 17.5 percent loading, which compensated for this reduction in income was ripped up by employers in AWAs and non-union agreements under WorkChoices.
It may be possible to have the loading included in the award, this is not clear. Otherwise it will be left to those unions who can win it in collective agreements. Periods on workers’ compensation, unpaid leave, or not paid due to industrial action are not counted in calculating the accrual of leave.
5. Personal/carer’s leave and compassionate leave
This is much along the lines of the present minimum, but below what is provided in some industries and the public service. Its use is reasonably broad providing for 10 days for each year of service and is cumulative.
The entitlement also has provisions for additional unpaid leave in some situations when certain leave entitlements have been used up.
There are provisions for unpaid leave for casuals of up to two days per occasion for carer’s and compassionate leave. There would be no qualifying period before leave could be accessed and no limits on the amount that could be accumulated which are positive provisions.
Questions are raised about when an employer might reasonably require a medical certificate, which the government believes should not be necessary for every absence.
6. Community service leave
The government believes that people who serve on juries, fight bushfires or provide emergency relief after a local disaster, perform vital community services and should not be adversely affected in their employment.
The proposed NES gives employees the right to be absent from work to engage in such activities. In relation to jury service, top-up pay will remain. For other services the proposal is for unpaid leave.
7. Long service leave (LSL)
The government’s aim is for a national, uniform minimum standard and hopes to achieve this by working with the states. At present LSL provisions are found in state laws, and federal and state awards. Some workers have no entitlements, and there is the question of portability where unions such as in the building industry have fought hard for portability. This latter point is not dealt with in the paper.
The proposed NES will not override state and territory laws and will be based on an applicable award if not already provided for by other means.
There is a great deal of work to be done in this area for some sectors of the workforce. Much will depend on what emerges when a minimum standard is eventually adopted.
8. Public holidays
The NES specifies Christmas Day, Boxing Day, New Year’s Day, Australia Day, Anzac Day, Queen’s Birthday, Good Friday and Easter Monday are public holidays.
State and territory governments will retain their powers to declare public holidays. Any compensation for working on a public holiday will be left to the award. The award will also specify any occupation- or industry-specific holidays.
Questions are raised for discussion about what might be reasonable grounds for a worker to refuse to work on a public holiday when requested by their employer.
9. Notice of termination and redundancy
The right to redundancy pay under the NES is restricted to workplaces with 15 or more employees, and the scale is that determined by the Australian Industrial Relations Commission 2004 Redundancy Test Case.
If not added to a collective agreement or award, many workers stand to lose present entitlements. The provision does not apply to employees employed under a contract of employment for a specified period or task, those serving probation, casuals (including long-term casuals) or trainees.
Space does not permit elaboration on the detail here, but it is worth studying carefully by anyone making a submission.
10. Fair Work Information Statement
When workers are hired employers will be obliged to give them a copy of a standard Fair Work Information Statement, to be published by the new Fair Work Australia body. This will provide information about the NES; modern awards; agreement making; the right to freedom of association; the role of Fair Work Australia.
"The Information Statement will also provide contact details for Fair Work Australia so that employees will know where to go to access further information and assistance.
"The NES will cover the key minimum entitlements for all Australian employees, to apply from January 1, 2010. These entitlements will be guaranteed in legislation so that they cannot be excluded or modified in a way that undermines the safety net."
No mention is made about the role of trade unions in providing information or assistance. The role of trade unions and the rights of trade unions have yet to be spelt out in draft legislation. It is not clear whether these might be allowed in awards in relation to how issues are resolved.
Until the 10 allowable matters are spelt out and it is seen whether they improve upon the present stripped awards, it is impossible to make an overall assessment of the new safety net that will underpin the industrial relations system.
Submissions
The Government is calling for responses to the issues raised in the discussion paper on NES by 4 April 2008. Submissions can be provided electronically to the email address: NES_comment@deewr.gov.au
Submissions may also be mailed to:
NES Exposure Draft submission GC 31
Workplace Relations Policy Group
Department of Education, Employment and Workplace Relations
GPO Box 9879, CANBERRA ACT 2601