The provisions, which were strongly opposed by unions 13 years ago, deal with:

1. prohibiting employers from paying remuneration to full-time union officials (currently this is permitted); and
2. giving legal permission for multiple unions to be established at a single worksite (currently each enterprise may legally only have one trade union).

To read more about this development, click here.

Contributors:  George Cooper, Partner, and Celia Yuen, Senior Associate

It also heralds a new era in complaint handling by the Victorian Equal Opportunity and Human Rights Commission by giving the powers to investigate discrimination, sexual harassment and victimisation even without a complaint and to issue compliance notices to employers.

These changes may foreshadow the future trend of legislative changes in other states and territories across Australia.

Read the full post here.

This entry was written by Kate Jenkins and Lisa Croxford.

Read the full post here.

Read the full post here.

This entry was written by Kate Jenkins and Lisa Croxford.

At first instance, Commissioner Smith refused to approve the enterprise agreement as he was not satisfied that it contained a dispute resolution term as required by section 186(6) of the Fair Work Act 2009 (Cth) (Act). That section provides that all enterprise agreements must contain a term that requires or allows FWA or another independent person to 'settle disputes' about matters that arise under the agreement, or that relate to the National Employment Standards (NES).

The proposed enterprise agreement contained a dispute resolution procedure which:

• allowed either party to refer the dispute to FWA for conciliation; and
• allowed the parties to agree to have the matter arbitrated by FWA (that is, FWA could not arbitrate unless both parties agreed with that course).

Commissioner Smith decided that:

• FWA must be satisfied that there is a procedure in an enterprise agreements which 'requires or allows' FWA (or another independent person) to 'settle disputes'. In order to do so, either FWA or the independent person must be able to 'direct' or 'appoint' a final result.
• The provisions in the Act in respect of dispute resolution procedures are different to those which existed in the pre-'Work Choices' Workplace Relations Act 1996 (Cth), which had been interpreted as not requiring disputes to be resolved by arbitration as a last resort.
• The enterprise agreement failed to satisfy section 186(6) of the Act because it did not permit a third party to arbitrate if the dispute could not be resolved by the parties.

Appeal

The Full Bench decision concluded that the Act does not require dispute procedures in agreements to provide for arbitration. This is consistent with the long established principle that a dispute settlement provision in an agreement need only contain a procedure for preventing and settling disputes, not one which guaranteed a settlement in each case.

In its decision, the Full Bench relied upon the decision in Ampol Refineries (NSW Pty Ltd and Australian Institute of Marine and Power Engineers (1998) Print P8620 (Ampol). They concluded that if the Legislature had intended to alter the effect of the decision in Ampol, it could have easily made that intention explicit. Importantly, counsel for the Minister for Workplace Relations also appeared and supported the contention that the legislation did not alter the longstanding practice of voluntary arbitration in this area.

The decision makes it clear that a dispute settlement term in an enterprise agreement is not required to mandate arbitration.

Read full posts here and here.

This entry was written by Chris Barton and Andrew Pollock.

In addition to having significant implications for the conduct of prosecutions in New South Wales, the decision is likely to impact the way in which prosecutions are defended under occupational health and safety legislation in all Australian states and territories.

Kirk, the owner of a farm, was prosecuted by the WorkCover Authority of NSW (WorkCover) in relation to the death of one of his company's employees (Palmer), who died while driving an all terrain vehicle on Kirk's farm. Palmer had driven the vehicle directly down a sharp incline rather than using an available and safe private road.

WorkCover investigated the incident and commenced proceedings alleging that both the employing entity and Kirk (as director) had failed to take reasonably practicable steps to ensure the health and safety of Palmer.

At first instance, both the employing entity and Kirk were found guilty of OHS Act breaches. A series of appeals were brought by Kirk against that conviction, and ultimately the matter was referred to the High Court of Australia.

Outcome of the Decision in the High Court

The High Court of Australia quashed the original conviction and the penalties against Kirk and the employing entity. The High Court of Australia also ordered WorkCover to pay Kirk's legal costs.

Some of the key issues raised in the High Court of Australia's decision are:

• Legislative attempts in the OHS Act and Industrial Relations Act 1997 (NSW) to oust the jurisdiction of the Supreme Court of New South Wales were deemed unconstitutional.
• The obligation is on the prosecutor to sufficiently particularise the charges brought against the defendant.
• Procedural errors in this case undermined the validity of the conviction. Allowing the prosecution to call Kirk as a witness constituted a procedural error and it required that Kirk's conviction be quashed.
• While the duty under occupational health and safety (OHS) legislation to 'supervise' is often a vexed issue, Heydon J held that constant surveillance of employees' work activities is an impossible and unfair obligation on directors and officers.

Implications of the Decision

Significant implications of this decision relate to:

• the way in which charges are drafted by WorkCover and other bodies who have the statutory right to prosecute OHS matters in New South Wales;
• the approach which the Industrial Court of New South Wales must now adopt when adjudicating those charges both in terms of their interpretation of the law and also compliance with legal procedure;
• the way in which prosecutors and the courts administer and interpret similar legislation in other states and territories;
• the question of appeal rights arising from a decision of the Industrial Court of New South Wales; and
• an increased awareness of what matters might offer scope for appeal because of jurisdictional error in courts and tribunals, particularly in New South Wales.

Read full post here.

This entry was written by Chris Barton and Andrew Pollock.

The Report contains 17 recommendations covering areas such as remuneration principles and disclosures, shareholder engagement and conflicts of interest. In the main, these recommendations reflect those contained in the draft report, including the draft recommendations to restrict remuneration report disclosures to key management personnel and to simplify the remuneration report, and the draft recommendation that cessation of employment be removed as a taxing point for deferred equity subject to forfeiture.

Two-strikes plus a resolution to 'spill' the board (recommendation 15) - The Productivity Commission has diluted the draft report's two-strikes proposal under which two consecutive 'no' votes equal to or greater than 25% on a company's remuneration report would trigger an automatic re-election of directors. The final recommendation includes an extra hurdle which means that if two consecutive 'no' votes of 25% or more are received, a separate re-election resolution is activated to the effect that all elected directors who signed the directors' report for that year must stand for re-election at an extraordinary general meeting, which must be held within 90 days.

Declarations of 'no vacancy' must be approved by shareholder (recommendation 1) - The Productivity Commission has also retained its draft recommendation that shareholders must approve a declaration of 'no vacancy' on a company board at a general meeting. This recommendation is a response to criticism that boards use the 'no vacancy' rule to exclude outsiders. However, the recommendation has been criticised by business groups who state that boards are best placed to decided how many members are needed to work efficiently and that resolutions such as these will distract boards from protecting the company's financial health and growth prospects.

Implementation (recommendations 16 and 17) - Recommendations 16 and 17 propose, respectively, that:

• recommendations 2 and 3 on conflict of interest matters, and recommendations 10 and 11 relating to remuneration advisers be implemented by legislation if the ASX and the ASX Corporate Governance Council do not make the requisite changes; and
• the reforms flowing from the Report be reviewed within 5 years.

The full list of final recommendations can be found here (pdf).

Government Reponse to the Report

In April 2010, the Federal Government indicated how it would respond to the Report. While the Government agreed with many of the Report's recommendations (see responses here), it did not support the recommendation that cessation of employment be removed as a trigger for taxation of deferred employee shares. This will significantly affect the structure of such salaries in the future.

Read full post here.

This entry was written by Chris Barton and Andrew Pollock.

The provisions set to take effect in 2010 deal with:

• prohibiting employers from paying remuneration to full-time union officials, and
• giving legal permission for multiple unions to be established at a single worksite (currently each enterprise may legally only have one trade union).

The lead up to the implementation of the provisions is likely to be a difficult time for employers in Korea with unionised workforces. The Federation of Korean Trade Unions has indicated its intention to call a general strike in protest against implementation of the provisions.

Employers will also need to prepare themselves for the provisions coming into effect, including:

• Ensuring that any current practice of remunerating full-time union officials ceases upon the law coming into effect; and
• Putting in place a strategy to plan for the possibility that multiple unions may seek to represent employees on site, and adapting bargaining strategies to take account of this change.

This entry was written by Celia Yuen, Singapore.

• All agreements involving an Indonesian private institution or individual must be in the Indonesian language. If a foreign party is involved, the agreement must also to be prepared in the national language of that party or in English (or both);
• The Indonesian language must be used in all formal communications in the workplace; and
• If an employee working in Indonesia is unable to communicate in the Indonesian language, they must enrol, or be enrolled, in an Indonesian language course.

At this stage, it is unclear how strictly the new law will be enforced by the authorities. A Presidential Regulation is expected to be issued to clarify the law's requirements. In the interests of compliance with the law, multi-national employers with operations in Indonesia may wish to take appropriate steps, including:

1. Checking that all contracts of employment with existing employees, both local and foreign, signed after 9 July 2009 are in the Indonesian language and, where appropriate, in bilingual version. Where this is not the case, new versions of contracts in the appropriate language(s) should be prepared as soon as possible.
2. Ensuring that contract templates to be used for local and foreign employees moving forward are in the Indonesian language and, where appropriate, in bilingual versions.
3. Ensuring that a process is in place for all formal communications in the workplace (e.g., letters of promotion, warning letters, mutual agreements to terminate employment) to be in the Indonesian language or, where appropriate, in bilingual versions.
4. Ensuring that all existing employees working in Indonesia are able to communicate in the Indonesian language and, if not, to enrol those employees in a language course.
5. Implementing a process as part of new employee transfers/assignments into Indonesia to ensure that employees who cannot communicate in Indonesian are enrolled in a language course.

This entry was written by Celia Yuen, Singapore.

Key changes proposed by the Bill include:

• A reduction in the 'cap' on termination payments so that ay payment in excess of one year's average annual base pay will require shareholder approval.
• For listed companies, a person will be captured by the new provisions if, at the time they cease employment, they were included in the company's remuneration report for the previous financial year as:
• one of the 5 most highly remunerated company or group executives; 
• a member of the key management personnel of the company; or
• if they have been so disclosed at any time in the previous 3 years.
• A broader definition of termination 'benefit'

Other notable proposed changes include new restrictions on the timing of shareholder approval, increased obligations and penalties, and a requirement to repay any unauthorised benefit and hold on trust.

This entry was written by Russell Allen.

• establishes a new body called Fair Work Australia to replace the Australian Industrial Relations Commission, the Workplace Authority, the Workplace Ombudsman and the Australian Building and Construction Commission;
• enhances the safety net - the National Employment Standards and modern awards - which will take effect from 1 January 2010;
• introduces new obligations to bargain in good faith, which can be enforced by Fair Work Australia making a bargaining order;
• provides Fair Work Australia with a much greater role in bargaining for enterprise agreements;
• expands the circumstances in which a union has a right of entry on employer's premises;
• limits the circumstances in which protected industrial action can be taken by employers (that is, when employers can implement a lockout);
• consolidates and expands upon the old freedom of association provisions in the new 'general protections' part of the Act, which prohibits a wide range of 'adverse action' against employees on a number of grounds;
• provides more employees with access to Fair Work Australia's unfair dismissal jurisdiction; and
• extends the transfer of business provisions to cover a much wider range of transactions, including insourcings and corporate reorganisations.

This entry was written by Russell Allen.