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Workplace relations: What’s on the horizon for 2021?

03 February 2021

#Workplace Relations & Safety, #COVID-19

Published by:

Adrian Zagami

Workplace relations: What’s on the horizon for 2021?

As 2021 gets underway, we outline three key topics on the workplace relations horizon.

1. Proposed amendments to the Fair Work Act 2009 (Cth)

In December 2020, the federal government announced the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2020 (Bill). The Bill proposes arguably the most change to the Fair Work Act 2009 (Cth) (FW Act) since its enactment. If the Bill is passed, the FW Act will be amended with respect to casual employees, enterprise bargaining, compliance and enforcement.

In particular the amendments cover (without limitation):

  • casual employment the Bill proposes to define “casual employee” by reference to the circumstances at the time the offer of employment is made, amend the National Employment Standards to include a statutory mechanism to convert casual employment to part-time or full-time employment and to prevent situations of ‘double-dipping’
  • modern award flexibility provisions in a number of awards with respect to part-time employment and extending JobKeeper provisions
  • enterprise bargaining, including streamlining and simplifying the approval process and shifting the focus of the Better Off Overall Test (BOOT) to a more holistic approach
  • legacy enterprise agreements (including transitional instruments) approved pre-FW Act or during the bridging period before the commencement of modern awards will automatically terminate on 1 July 2022 and employee entitlements will revert to the relevant modern award
  • compliance and enforcement, including increases to civil penalties and the introduction of a new criminal offence for dishonest and systematic wage underpayments with potential jail terms and significant fines.

It is expected that the Bill will be heavily debated in the Senate this year, particularly with respect to the proposed amendments to enterprise bargaining.

2. The question of true “casual employment” enters High Court territory

The High Court appeal of the Workpac v Rossato [2020] FCAFC is underway with the hearing likely to be listed during 2021.

This is an appeal of the decision of the Full Bench of the Federal Court of Australia in which it was held that annual leave, compassionate leave and personal leave was payable to employees who were incorrectly characterised by their employer as long-term casuals. The decision also relied upon the factors considered in Skene v WorkPac Pty Ltd (2018) 264 FCR 536 when characterising the true nature of the employee’s employment. Our previous discussion on the decision is available here.

Employers are keenly awaiting High Court determination of this issue. The Rossato and Skene decisions are at odds with the common understanding that the 25 per cent casual loading offset permanent employee entitlements, which has raised concerns about the financial viability of casual employment, including the ‘double-dipping’ of monetary entitlements which presents a real commercial risk.

The High Court appeal remains important on the question of true casual employment for assessing the risk from any historic and current casual arrangements.

3. Ongoing impacts of the COVID-19 pandemic

We expect employers to be faced with a number of challenges arising from COVID-19 related impacts to business including with respect to:

  • employee disputes arising from restructures and redundancies as a consequence of the economic impact of COVID-19. This includes rapidly changing economic conditions and business requirements, which results in a greater need for clarity around decision-making processes and the grounds for decisions at particular points in time which impact on employment in the event these decisions are challenged
  • managing employees returning to work in the ‘new normal’ as we anticipate employers will receive requests for flexible work arrangements, including requests to work remotely. Employees who meet the statutory eligibility criteria under FW Act have a right to request a flexible working arrangement and any request made in accordance with relevant legislation must only be refused on reasonable business grounds. Employers must also ensure they comply with other statutory obligations that apply to a request made under the FW Act, which includes discussing the request with the employee, trying to reach an agreement with the employee about changes to the employee’s working conditions and considering mandatory factors. Further, an employer must respond in writing and within 21 days to any request for a flexible working arrangement made in accordance with the FW Act. Careful consideration will need to be given to the reasons which the employer says are “reasonable business grounds” before these are documented
  • the roll-out of the COVID-19 vaccination and whether employers can direct employees to be vaccinated having regard to work health and safety obligations and personal preferences and beliefs of employees
  • managing ill and injured employees has been a long-standing challenge for employers and the COVID-19 pandemic will only exacerbate this. COVID-19 restrictions have had a significant impact on employee health and wellbeing, including with respect to mental health. Behaviours such as absenteeism, poor performance, changes in moods and unsociable behaviour may be indicators of employee health and wellbeing related issues requiring support in the form of an employee assistance program or other wellbeing programs offered in the workplace.

Authors: Louise Rumble, Jennifer van Bronswijk & Adrian Zagami

The information in this publication is of a general nature and is not intended to address the circumstances of any particular individual or entity. Although we endeavour to provide accurate and timely information, we do not guarantee that the information in this article is accurate at the date it is received or that it will continue to be accurate in the future.

Published by:

Adrian Zagami

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