What does the future hold? – the changing landscape for employers in Australia

Changes to the industrial relations system are looming, with the Prime Minister asking the Attorney-General in his capacity as Minister for Industrial Relations to look at the system and the Minister releasing two discussion papers seeking input about the operation of certain parts of the system. The closing date for submissions is 3 April 2020.

The two discussion papers are:

  1. Improving protections of employees’ wages and entitlements: further strengthening the civil compliance and enforcement framework; and
  2. Review of the Code for the tendering and performance of Building Work 2016.

The compliance and enforcement framework

In the February workshop on what to expect in the workplace in 2020, Erin Lynch, Partner gave her thoughts on 2020 and specifically called out compliance as a key theme this year. This discussion paper is certainly consistent with the rhetoric that the theme of compliance (and enforcement) is at an all-time high in the employment and workplace relations space.

With an ever increasing complexity around employee entitlements, including the annualised salary arrangements set to take force in some modern awards on 1 March 2020, the risk of breaching employment laws is also at an all-time high.

The risk of a breach combined with an increased compliance and enforcement framework will no doubt be creating concern for employers. We have already seen suggestions about how adverse publicity around underpayments can impact on a business. While the discussion paper does not address non-compliance on a sliding scale or employers who make innocent or unintentional mistakes, we predict this will be a key theme in the submissions.

This discussion paper is seeking views on:

  1. the Fair Work Ombudsman (FWO) being provided with the same information-gathering powers as other business regulators such as the ACCC;
  2. the FWO accepting an undertaking preventing future contraventions;
  3. giving the FWO the power to cancel an undertaking and pursue litigation;
  4. allowing the FWO to enter into written public commitments with businesses, usually for two to three years;
  5. adverse publicity orders that require a person to disclose or publish certain information. For example, a notice that admits underpayments of employees;
  6. banning orders which would prevent individuals or companies from operating in a specific way or for a prescribed period. For example, not allowing employers who have breached employment laws to recruit migrant workers for a certain period;
  7. providing for Director disqualification orders to prevent certain persons from managing a corporation;
  8. prohibitions on advertising jobs with non-compliant pay rates; and
  9. a more effective small claims procedure, including reducing filing fees, allowing costs orders, increasing the small claims cap (which is currently $20,000) and introducing the Fair Work Commission for case management purposes.

Review of the Code for the tendering and performance of Building Work 2016 (Code).  

The discussion paper again addresses key themes we are seeing in the industry. In our experience, there is increased discussion about access to skilled and reliable labour, fatalities on site, mental health and the under representation of women in the industry.

With the Government committed to investing $100 billion in infrastructure over the next 10 years from 2019-2020, the Code (and compliance with the Code) will certainly become a consideration for more and more businesses in the building and construction industry.

This discussion paper is seeking evidence-based feedback on:

  1. boosting productivity, through for example, changes to the enterprise agreement requirements in the Code;
  2. improvements to allow timely and flexible access to the right workers;
  3. the layers of engagement that cause additional costs to businesses;
  4. engagement processes that could provide more accessible and digestible information;
  5. a simplified reporting system under the Code;
  6. increasing the support of safety issues;
  7. the encouragement of employment opportunities and diversity;
  8. how the Code could better encourage lawful behaviour; and
  9. any clarity or amendments required within the Code.

If you would like to discuss this further and the implications for your business please contact our Employment + Workplace Relations Partner, Erin Lynch.

Erin Lynch, Partner
M +61 477 330 202
E erin.lynch@vincentyoung.com.au