Suites données aux recommandations du comité et du Conseil d’administration - Rapport No. 364, Juin 2012

Effect given to the recommendations of the Committee and the Governing Body

1. 15. The Committee last examined this case at its June 2010 meeting [see 357th Report, approved by the Governing Body at its 308th Session, paras 165–229]. On that occasion, the Committee made the following recommendations:
   • (a) The Committee wishes at the outset to recognize the efforts that were made by the Government when drafting the Fair Work Act to consult the social partners with the aim of concluding a carefully drafted Act intended to balance a variety of important interests in the field of industrial relations. It encourages the Government, in its review of the application of the FWA, to proceed in the same way of full consultation.
   • (b) The Committee requests the Government to keep it informed of the application of the provisions of the FWA concerning individual flexibility arrangements in practice.
   • (c) Recalling that the Collective Agreements Recommendation, 1951 (No. 91), stresses the role of workers’ organizations as one of the parties in collective bargaining, and that direct negotiation between the undertaking and its employees, bypassing representative organizations where these exist, might, in certain cases, be detrimental to the principle that negotiation between employers and organizations of workers should be encouraged and promoted, the Committee requests the Government to ensure respect for this principle and to provide detailed information on the application of section 172 of the FWA in practice, so as to allow it to determine the impact of this provision on the promotion of negotiations between employers and workers’ organizations.
   • (d) Taking into account its conclusions on such matters reached in previous cases concerning Australia, the Committee requests the Government to review sections 409(1)(b), 409(4) and 413(2) of the FWA, in full consultation with the social partners concerned.
   • (e) The Committee requests the Government to provide detailed information on the application of sections 409(1)(a), 409(3), 423, 424, 426 and 431 of the FWA and to review these provisions, in consultation with the social partners, with a view to their revision, where appropriate.
   • (f) The Committee requests the Government to provide detailed information on the practical application of the provisions of Part 3-3, Division 8, of the FWA concerning protected action ballots.
   • (g) The Committee requests the Government to provide further clarification on the application of sections 172 and 194 of the FWA concerning the subject matter for collective bargaining and to review these sections, in full consultation with the social partners, in line with the principles cited in its conclusions.
   • (h) The Committee requests the Government to provide information on the practical application of section 513 of the FWA, including any statistics relating thereto, in order to allow it to assess the impact of that section on the right of workers’ representatives to access the workplace.
2. 16. In its communication dated 5 January 2011, the Government notes that the Committee did not conclude that the Fair Work Act, 2009 (FWA), is inconsistent with Conventions Nos 87 and 98 and that it commended the Government’s efforts in consulting with social partners. The Government notes that this is consistent with the 2009 comments of the Committee of Experts on the Application of Conventions and Recommendations, which further noted with satisfaction that collective bargaining at the enterprise level is now at the heart of the new workplace relations system, and that statutory individual agreements can no longer be made.
3. 17. The Government indicates that, in response to three recommendations in which the Committee had requested the Government to review certain sections of the FWA ((d), (e) and (g)) in consultation with the social partners, it undertook the requested consultations with Australia’s social partners – the Australian Chamber of Commerce and Industry, the Australian Council of Trade Unions and the Australian Industry Group – on 1 November 2010. The Government further states that, in reply to the Committee’s recommendations, it provides clarification on the practical application of a number of sections of the FWA, statistics (where possible) on their use since commencement and relevant case law. Given that the FWA is still in the early stages of being implemented, the Government indicates that it will continue to closely monitor its implementation and ongoing operation.
4. 18. As regards recommendation (b) concerning individual flexibility arrangements (IFA), the Government indicates that, while the FWA does not provide for individual statutory agreements to be made between employers and individual employees, collectively negotiated enterprise agreements are required to include a flexibility term that enables an employee and employer to agree to an IFA that varies the effect of the enterprise agreement between the employer and the employee, with the agreement of that employee. The Government states that, under the FWA, an offer of employment cannot be made conditional on a person entering into an IFA and employees can terminate an IFA with 28 days notice in writing. The model flexibility term contained in 54.7 per cent of agreements enables an IFA to vary the effect of terms about arrangements for when work is performed, overtime rates, penalty rates, allowances and leave loadings; 8.5 per cent of agreements permit IFAs to be made about any terms of the agreement. The Government adds that, as IFAs are made between employers and individual employees and not separately lodged with Fair Work Australia there is currently no statistical data available on the making or use of IFAs under the FWA. However, section 653 requires Fair Work Australia to research and report every three years (commencing with the period 26 May 2009–25 May 2012) on the extent to which IFAs under modern awards and enterprise agreements are being agreed to, and the content of those arrangements. Also, the Fair Work Ombudsman may investigate complaints in this regard.
5. 19. As regards recommendation (c) concerning the ability to make collective agreements without union involvement (section 172 of the FWA), the Government states that the provisions of the FWA on the making of enterprise agreements facilitate the involvement of unions in the relevant negotiations consistent with Article 4 of Convention No. 98. The Act: (i) automatically enables a union to represent an employee who is a union member in bargaining for a proposed agreement unless the employee chooses to appoint someone else; (ii) requires an employer to advise employees of their right to appoint a bargaining representative and explain the status of unions as default bargaining representatives for their members; (iii) enables employees who are not union members to appoint as a bargaining representative a union capable of representing the employee’s industrial interests or else they can appoint another bargaining representative or themselves and bargain with their employer directly; and (iv) requires bargaining representatives to bargain in good faith (otherwise Fair Work Australia may issue a bargaining order). Where a majority of employees wish to bargain collectively and their employer refuses to do so, a union that is an employee bargaining representative can apply to Fair Work Australia to make a majority support determination, in which case an employer is required to bargain with employee bargaining representatives. The Government emphasizes that to date no complaints regarding the application of the relevant provisions have been submitted to Fair Work Australia, and considers that they are operating effectively.
6. 20. As regards recommendation (d) to review sections 409(l)(b), 409(4) and 413(2) concerning the level of bargaining, the Government considers that the bargaining and industrial action frameworks of the FWA are consistent with the principle of free and voluntary collective bargaining embodied in Article 4 of Convention No. 98, and with the Committee’s view that the determination of the bargaining level is a matter for the discretion of the parties. Under the FWA, employees and employers can freely determine the level at which they wish to bargain. While an emphasis is put on enterprise-level collective bargaining, the FWA also provides for voluntary bargaining at the industry level. The Government indicates that from 1 July 2009 to 30 June 2010 there were 22 applications for the authorization of a single-enterprise agreement covering two or more single-interest employers of which all were granted by Fair Work Australia; and 69 applications for the authorization of a multi-enterprise agreement covering two or more employers, of which 55 were granted; the main criterion for approval being that the employers voluntarily agreed to bargain and make the agreement without coercion. The Government adds that the prohibition on protected industrial action taken in support of claims for multi-enterprise agreements in section 413(2) is consistent with the overall bargaining framework of the FWA, especially with the voluntary nature of multi-employer agreements. The FWA promotes collective bargaining in good faith without however imposing a requirement on parties to reach agreement, and specifically encourages employers and employees to bargain collectively, for example by making a majority support determination where a majority of employees wish to bargain collectively and their employer refuses to do so. Further, while industrial action taken in support of pattern bargaining is not protected, the FWA allows employers and their employees (and relevant bargaining representatives) to engage in discussions at both enterprise and industry levels about terms and conditions of employment. Also, the making of common claims across multiple workplaces does not prevent a finding that a bargaining representative is genuinely trying to reach agreement with an employer.
7. 21. As regards recommendation (e) to review sections 409(1)(a), 409(3), 423, 424, 426 and 431 of the FWA concerning industrial action and report on their practical application, the Government believes that the industrial action provisions strike the right balance between an employee’s right to strike and the need to protect life and economic stability in a manner that is appropriate to national conditions. Unless the action is likely to involve personal injury or damage, or the destruction or taking of property, the FWA protects workers and their unions against a civil suit for damages in relation to that industrial action. It allows employers and employees to bargain about and take protected industrial action in relation to a wider range of matters than was possible under the former Workplace Relations Act. Enterprise agreements under the FWA can be made about, and employees may take protected industrial action to support or advance claims about, or reasonably believed to be about, “permitted matters” (i.e. matters pertaining to the relationship between the employer and its employees, matters pertaining to the relationship between the employer and the employee organization or organizations to be covered by the agreement, deductions from wages for purposes authorized by an employee and the manner of operation of the agreement). This formulation is of long standing and there is substantial jurisprudence about what it means. Unlawful terms and matters that do not bear directly on the relationship between an employer and an employee in those capacities, such as matters of an academic, political or social nature, are excluded from the scope of enterprise agreements, and protected industrial action.
8. 22. Furthermore, the Government indicates that, in very limited circumstances (significant economic harm to the employer(s) and employees in case of protracted industrial action and unlikely dispute resolution in the near future – section 423; endangering life, personal safety and health or welfare of the population or part of it, or threat to cause significant damage to the economy or an important part of it – section 424; ministerial declaration on the grounds of section 424 – section 431; and significant harm to third parties – section 426), the FWA provides for protected industrial action to be suspended or terminated by Fair Work Australia after hearing the parties to the dispute. During the period 1 July 2009–30 June 2010: nine applications for orders to suspend or terminate industrial action were made to Fair Work Australia under section 423, of which all were declined; eight applications were made to Fair Work Australia under section 424, of which four were granted; no minister (including under the former Workplace Relations Act) has exercised the power under section 431; four applications were made to Fair Work Australia under section 426, of which two were granted. The Government strongly believes that the thresholds for suspending or terminating industrial action are appropriately high to balance the rights of employees to take industrial action with the Government’s responsibilities for protecting the national economy and the safety, health or welfare of the population and the legitimate interests of other affected parties. With reference to paragraphs 550 and 551 of the Digest of decisions and principles of the Freedom of Association Committee, the Government indicates that after termination of protected industrial action under sections 423, 424 or 431 of the FWA, bargaining representatives have a negotiating period of 21 days (extendable to 42 days by Fair Work Australia) in which to resolve the matters at issue; if they are unable to reach agreement, a Full Bench of Fair Work Australia is required to make a binding industrial action related workplace determination which has effect as an enterprise agreement.
9. 23. As regards recommendation (f) to report on the practical application of the provisions in Division 8 of Part 3-3 of the FWA concerning protected action ballots, the Government believes that these provisions are fair, operating as intended and consistent with Article 4 of Convention No. 98, and that the case law regarding protected action ballots demonstrates that the procedures are reasonable and do not frustrate or delay the taking of industrial action. During the period 1 July 2009–30 June 2010, there were 981 applications to Fair Work Australia for a protected action ballot order, of which 794 were approved (81 per cent); 85 per cent of industrial matters were heard within two days of lodgement. The decisions to date indicate that Fair Work Australia does not take an unduly technical approach when determining protected action ballot applications; rather than refusing applications that are not in line with the FWA requirements, it has provided applicants with the opportunity to amend applications where appropriate. This practical approach supports the intent and spirit of the legislation. Furthermore, the Government indicates that pursuant to section 443(1), Fair Work Australia must make a protected action ballot order if an application has been made and it is satisfied that each applicant has been, and is, genuinely trying to reach an agreement, and supplies case law examples illustrating how Fair Work Australia interprets the meaning of “genuinely trying to reach an agreement”. The Government adds that the FWA does not require a majority of all employees who will be covered by a proposed enterprise agreement to vote in favour of industrial action in order for the action to be protected, but rather requires under section 459 that at least 50 per cent of those on the roll of voters participate in the ballot; and that more than 50 per cent of valid votes cast be in favour of the industrial action.
10. 24. As regards recommendation (g) to provide further clarification of the application of sections 172 and 194 of the FWA concerning the content of enterprise agreements and to review them in full consultation with the social partners, the Government submits that these provisions are consistent with Article 4 of Convention No. 98 which envisages the regulation of terms and conditions of employment by means of collective agreement, as appropriate to national conditions. Section 172 enables enterprise agreements to be made about permitted matters, including matters pertaining to the relationship between employer and their employees, or between an employer and an employee organization. Commonwealth workplace relations law has long required industrial instruments to deal with such matters, and the concept has evolved over time in line with changing community understandings and expectations. The Government indicates that, as acknowledged by the Committee, the FWA broadens the scope of agreement content compared to the former Workplace Relations Act. Enterprise agreements can include terms relating to deduction of union fees, union training leave, renegotiation of agreements, cashing out of annual leave, consultation with unions about major change in the workplace and the role of unions in dispute settlement procedures. Terms that would be within the scope of matters pertaining to the relationship between an employer and employees or a union include: staffing levels; engagement of casuals and contractors where it relates to the job security of employees; conversion of casual to permanent employment; restrictions on employers seeking contributions or indemnities from employees in relation to personal injuries caused by and to the person in the course of employment; paid leave for union meetings or activities; promotion of union membership; and methods for providing union information to employees. On the other hand, the Government states that the content of enterprise agreements does not extend to matters of a political or social nature which are outside the sphere of employers’ relationships with their employees and representative organizations of employees. Terms that would not be within the scope of matters pertaining to the relationship between an employer and employees or a union include: general prohibitions on the engagement of labour hire employees or contractors; requirements for employers to make political or charitable donations; limits on employer choice in relation to clients, customers or suppliers aimed at meeting specified employment, environmental or ethical standards; and employers’ corporate social responsibility (e.g. participation in charity events, commitment to climate change initiatives). Moreover, section 194 prevents an enterprise agreement from containing unlawful terms, such as discriminatory terms (e.g. terms that discriminate against an employee on the basis of race, sex, sexual preference, age or disability) and terms that are not consistent with provisions of the FWA which is given primacy as the source of rights and obligations in relation to the following matters, such as: objectionable terms (i.e. requiring or permitting contravention of the FWA general protections provisions or the payment of a bargaining services fee); terms that confer an entitlement or remedy for unfair dismissal before an employee has completed a minimum employment period as required by Part 3-2 of the FWA; terms that exclude or modify the FWA unfair dismissal provisions in a detrimental way; terms that are inconsistent with the FWA industrial action provisions; or terms that provide for right of entry for the purpose of investigating suspected contraventions, or to hold discussions with employees, or for the exercise of a state or territory occupational health and safety right other than in accordance with the FWA right of entry provisions.
11. 25. As regards recommendation (h) to provide information on the practical application of section 513 of the FWA so as to assess its impact on the right of workers’ representatives to access the workplace, the Government emphasizes that the requirement that a person be “fit and proper” to enter premises under the statutory right of entry scheme in the FWA has been part of the Australian workplace relations framework since 2006 and the requirement previously contained in the Workplace Relations Act. In determining whether an official is a “fit and proper person” to hold a right of entry permit, section 513 requires Fair Work Australia to take certain matters into account. The only time that it will not have the discretion to grant an entry permit is where a suspension or disqualification applies to the official’s exercise of, or application for, a right of entry under a state or territory industrial or occupational health and safety law. During the period 1 July 2009 to 30 June 2010, Fair Work Australia reported that it received 1,704 applications for an entry permit, of which 82 per cent were finalized within 28 days. No statistics are available regarding how many of the finalized applications resulted in a permit being granted. Only five union officials have had their right of entry permits revoked since June 1998. No entry permits have been revoked since June 2004.
12. 26. The Committee notes the detailed information provided by the Government. It notes with interest that, when reviewing certain sections of the FWA, the Government undertook consultations with Australia’s social partners – the Australian Chamber of Commerce and Industry, the Australian Council of Trade Unions and the Australian Industry Group.
13. 27. With respect to recommendation (b), while observing that the provisions of the FWA concerning IFAs seek to protect employees (including prospective employees) from undue influence or pressure being exerted by an employer, the Committee recalls that in a case in which the relationship between individual contracts and the collective agreement seems to have been agreed between the employer and the trade union organizations, such cases do not call for further examination and requests the Government to indicate to the Committee of Experts on the Application of Conventions and Recommendations (CEACR) whether IFAs are compulsory and to provide information on their application in practice including the extent to which IFAs are agreed to and their content, taking into account the relevant report to be issued by Fair Work Australia and any complaints filed with the Fair Work Ombudsman. The Committee further requests the Government to provide information to the CEACR on developments and any relevant statistics in relation to the practical application of the provisions referred to in recommendations (c), (g) and (h) as well as further developments in relation to the review of the provisions mentioned in recommendations (d) and (e).
14. 28. With respect to recommendation (f), the Committee notes the Government’s view according to which the provisions in Division 8 of Part 3-3 of the FWA concerning protected action ballots are fair, operating as intended and consistent with Article 4 of Convention No. 98, and that the procedures are reasonable and do not frustrate or delay the taking of industrial action. It also notes that during the period 1 July 2009–30 June 2010, the vast majority of applications to Fair Work Australia for a protected action ballot order were approved, and that most applications have been processed swiftly. In light of the case law supplied by the Government, the Committee notes that the application of the relevant provisions in practice by Fair Work Australia has not restricted up to now the means of action open to trade union organizations or prevented them from calling a legal strike.