Important changes to Fair Work Act relevant to small business for 2016
What do the recent changes to the Fair Work Act mean for you and your business?
In November 2015, an amended version of the Fair Work Amendment Bill 2014 (the Bill) was passed.
The subsequent changes to the Fair Work Act 2009 (Cth) (FW Act) place new parental leave obligations on employers and reduce the powers of unions.
On 27 February 2014, the Coalition Government introduced the Bill into Parliament. The Bill – seen at the time as being consistent with the Coalition’s pre-election promise to “keep the Fair Work framework” and improve it – sought to amend a range of employment-related areas, including:
- individual flexibility arrangements;
- rights of entry;
- annual leave loading;
- transfer of business requirements;
- protected industrial action;
- parental leave; and
- greenfields agreements
Only three main areas of the original Bill survived. On 13 October 2015, the Senate passed a watered-down version of the Bill. On 11 November 2015, the House of Representatives accepted these changes.
So what does it mean?
Three key changes include:
1. Employers must not refuse a request for the extension of parental leave without first giving the employee a reasonable opportunity to discuss it.
2. New enterprises can take a proposed greenfields agreements to the Fair Work Commission. These laws attempt to streamline negotiations and reduce delays.
Employers can now take a proposed greenfields agreements to the Fair Work Commission for approval if a deal hasn’t been struck within a negotiating period of 6 months.
The Coalition Government has reasoned that this time restriction will remove the opportunity for unions to hold up projects due to excessive wage demands.
The new greenfields agreement changes will be reviewed after two years.
3. Employees cannot take protected industrial action to force an employer to agree to bargain. This effectively overrules the JJ Richards decision in the Federal Court (J.J. Richards & Sons Pty Ltd v Fair Work Australia  FCAFC 53).
This will mean that – instead – a union needs to seek a majority support determination from the Fair Work Commission – which essentially requires showing a majority of the employees concerned (not merely union members) want an enterprise agreement.
Given these new changes to the FW Act, you will need to consider whether changes need to be made to:
- your employment contracts and terms relating to parental leave; and
- strategies and procedures relating to unions and enterprise bargaining negotiations.
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