The Fair Work Amendment Bill 2020 – and what it means for you
By now 2020 is old news, COVID shutdowns and economic distress have been front of mind and while we can see the light at the end of the tunnel, there is still some way to go. Without a doubt, retail has been one of the hardest hit industries in the past 12 months and although many in the retail sector have also been hit with major changes to casual overtime, modern awards and fluctuating rules and regulations on capacity, the industry continues to charge along.
While employees have been navigating the changes to government subsidy schemes, employers are taking all the options available to keep doors open, people in jobs and the bills paid. Some good news though, as the Federal Government took all the time available announcing on their last day of sitting in December 2020, proposed changes to industrial relations in a bill introduced call the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2020.
The proposed changes have been worked through over several months, focusing closely on how businesses can be supported to bounce back. Some of these changes are designed to catch employers who are deliberately doing the wrong thing, but many employers and small businesses could get caught up in the cross hairs and run the risk of criminal action for honest mistakes.
Though the changes are just propositions and still need to be reviewed and voted through parliament, many of the changes are pro-business and could support the growth of our struggling retail sector.
One of the main changes introduced in the bill is the statutory definition of a casual employee into the Fair Work act. The Federal Government hopes that by having a clear explanation of what a casual worker is, it will remove uncertainty and lead to less employers being exposed to underpayment claims.
The proposed definition states that if an employer makes an offer of employment to an employee where there is no firm advance commitment to continuing and indefinite work according to an agreed pattern of work, and the employee accepts such an offer, he/she will be a casual employee.
Employers who exploit their employees in cases of serious wage theft could face jail time under the proposed changes. Individuals found to be deliberately underpaying their staff could be jailed for up to four years or fined almost $1.11 million. Companies face a fine of almost $5.5 million. There will be leniency for SMEs who make an honest mistake when paying their staff, and for most this shouldn’t be an issue.
The IR reform bill also addresses the issue of double dipping and how to prevent employers from being caught up in it, following a recent Federal Court ruling. The ruling found that casual employees firmly committed in advance to ongoing work are, in fact, permanent employees entitled to seek paid annual leave, paid personal/carer’s leave and paid compassionate leave. SMEs will not have to pay casual workers those extra benefits if the bill passes.
Casual conversion would be included in the National Employment Standards if the IR reform bill passes, allowing employers to convert a casual worker into a permanent employee. Employers would have to offer those working regular shifts the opportunity to convert to permanent roles after 12 months if they wish to do so under the proposed changes.
This applies to casuals who have over the past six months of a 12-month period ‘worked a regular pattern of hours on an ongoing basis which, without significant adjustment, the employee could continue to work as a full-time or part-time employee’. Employers would have to agree to such a request unless they have reasonable grounds not to. This will lead to employers having to fork out more to keep casuals on their books.
Several modern Awards would also see increased flexibility of part-time work, which would allow employers to offer part-time employees additional shifts without having to pay overtime rates. This would apply to industries such as retail, hospitality, fast food, restaurant, and pharmacy. If made law, this could help struggling employers who prefer permanent part-time employees rather than relying on a casual worker to do the same job. The proposed provisions apply to part-time employees who work at least 16 hours but less than 38 hours a week and whose shifts are for at least three hours (which may include an additional hour).
Businesses both large and small have had to wade through an already difficult award system to ensure they’re doing the right thing by employees. Of the $123 million recovered by the Fair Work Ombudsmen last financial year, $90 million of it was self-reported by employers who realised their error.
While this Bill is welcome by those in many small businesses, there is still much that needs to be done to further support the backbone of the Australian economy to bounce back from the past 12 months.
British-born Edward Mallett started his professional life out as an employment relations barrister after having studied law at Cambridge University in the UK and Duke University in the US. After migrating to Australia in 2010 and seeing how high legal fees for business owners seeking HR advice were, Mr Mallett wanted to establish a new system which offered professional help at an affordable price. Seeing a gap in the market, Mr Mallett founded Employsure, a subscription-based workplace relations service offering round the clock advice to employers.