Regulation of the Workplace (HSC SSCE Legal Studies): Revision Notes

Regulation of the Workplace

The regulation of workplace relations in Australia involves a complex interplay between federal and state governments, tribunals, courts, and various stakeholder organizations. Understanding this framework is essential for examining how employment rights and obligations are established, enforced, and disputed.

Industrial relations: the state and federal framework

Commonwealth and state constitutional powers

The Australian Constitution establishes the foundation for workplace regulation through a division of powers between the Commonwealth and state governments.

Under s 51(xxxv) of the Australian Constitution, the Commonwealth has constitutional authority to legislate regarding "conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one state." This provision imposes significant limitations on federal power:

• The Commonwealth cannot directly regulate industrial relations through ordinary legislation
• Federal authority is restricted to creating dispute resolution mechanisms
• The power applies only to interstate industrial disputes

At the state level, s 5 of the Constitution Act 1902 (NSW) grants the NSW Parliament authority to legislate for the "peace, welfare and good government" of the state. This enables NSW to enact workplace legislation, establish employment standards (such as awards), and create procedures for resolving industrial disputes within state boundaries.

When federal and state laws conflict, s 109 of the Australian Constitution provides that Commonwealth legislation prevails. However, the coexistence of dual systems created confusion for employers trying to determine which award or agreement applied to their workplace, often requiring court resolution.

In recent decades, the Commonwealth has expanded its workplace jurisdiction by relying on alternative constitutional powers. The WorkChoices amendments to the Workplace Relations Act 1996 (Cth) in 2006 utilized the corporations power under s 51(xx) to establish a national industrial system for incorporated companies, effectively replacing separate state and federal systems.

Industrial relations and its stakeholders

Industrial relations refers to the relationship between employers, employees, the government, and trade unions. These four groups constitute the primary stakeholders in the industrial relations process, though industrial changes and disputes can affect the entire community.

The NSW Industrial Relations Commission (NSW IRC) and Fair Work Australia were established as specialized tribunals to help resolve workplace disputes. The Fair Work Act 2009 (Cth) created Fair Work Australia, a national tribunal that replaced:

• The Australian Industrial Relations Commission (AIRC)
• The Australian Fair Pay Commission (which previously set minimum wages)
• The Workplace Authority (which approved pre-July 2009 collective agreements using the "no disadvantage" test)

Both tribunals exercise powers to:

• Establish salary and working conditions through awards
• Resolve industrial disputes
• Hear and determine industrial matters including unfair dismissal, discrimination, and occupational health and safety issues

The Fair Work Act also established the Fair Work Ombudsman, replacing the Workplace Ombudsman and assuming the advisory functions of the Workplace Authority.

Industrial action: protected and unprotected

When employers and employees cannot resolve disputes through negotiation, they may engage in industrial action to exert pressure on the opposing party.

Employers may take industrial action by:

• Locking out employees (preventing them from entering the workplace) until they agree to certain terms
• Standing down employees (suspending them without pay, usually temporarily)
• Refusing to pay employees

Employees may engage in industrial action by:

• Going on strike (organized withdrawal of labour until a grievance is resolved)
• Working to rule (performing only the bare minimum required)
• Going slow (deliberately reducing productivity)
• Forming a picket line (a boundary of striking union members outside or near their workplace, which others are asked not to cross)

When negotiating a new enterprise agreement after an existing agreement expires, parties may engage in protected industrial action. This means the action cannot be legally stopped unless it involves:

• Injury to persons
• Damage to property
• Unlawful taking or use of property

The Minister for Employment and Workplace Relations also has power to terminate protected industrial action if it endangers public safety or the economy.

To commence protected industrial action supporting a new enterprise agreement, employees must:

1. Obtain an order from Fair Work Australia permitting them to proceed
2. Conduct a protected action ballot endorsing the industrial action

Fair Work Australia ensures the bargaining process complies with industrial laws. Disputes under modern awards and enterprise agreements must be resolved according to dispute resolution procedures contained in the award or agreement itself.

Negotiations between employers and employees

Workplace bargaining refers to negotiations between employees and employers regarding work types and working conditions. When all employees unite on workplace issues, they can negotiate from a position of strength, achieving better outcomes than individuals acting alone. Enterprise agreements reached through collective bargaining by employees or their union representatives often contain more generous conditions than those in modern awards.

When an individual employee is hired, the employer typically presents a contract of employment for both parties to sign. This contract specifies working hours, pay rates, leave entitlements, and other conditions. Crucially, the contract terms cannot be less favorable than:

• Wage rates and conditions in the modern award for that occupation, or
• The applicable enterprise agreement (if one exists at that workplace)

Employers should inform employees which award or agreement applies to their employment. Most (but not all) employees are covered by a modern award if not by an enterprise agreement.

Award/agreement-free employees (those covered by neither modern award nor enterprise agreement) may make agreements varying NES operation for limited matters:

• Averaging of hours of work
• Cashing out paid annual leave
• Substituting other days for public holidays
• Extra annual leave in exchange for equivalent pay sacrifice
• Extra personal or carer's leave in exchange for equivalent pay sacrifice

Fair Work Australia makes minimum wage orders for employees not covered by modern awards.

Dispute resolution mechanisms

Industrial disputes may arise concerning working conditions, pay, entitlements, and discrimination. Resolution mechanisms emphasize mediation and other consensual approaches before resorting to arbitration.

Consensual forms of dispute resolution

Both the Fair Work Act 2009 (Cth) and the Industrial Relations Act 1996 (NSW) require all awards and agreements to contain dispute resolution procedures (NSW exempts businesses with fewer than 20 employees from this requirement).

The primary aim of dispute resolution is encouraging parties to reach peaceful, mutually beneficial agreements through consent rather than arbitration. Consensual forms include conciliation and mediation (where a third party helps disputing parties settle their dispute).

The effectiveness of consensual methods depends on the nature of the relationship between parties. Mutual respect enhances the success of these approaches.

Fair Work Australia dispute resolution role

Under the Fair Work Act, disputing parties must first follow dispute resolution procedures outlined in their award or agreement. Initial discussions typically occur between employer and employees within the workplace.

If internal resolution fails, parties may take the matter to Fair Work Australia (FWA). FWA's role is determined by dispute resolution procedures in the relevant agreement or award. Generally, an FWA representative will:

• Discuss disputed issues with both parties
• Encourage consensual agreement through mediation or conciliation
• Make recommendations if necessary

FWA also assists with:

• Disputes arising under general protections provisions of the Fair Work Act
• Disputes arising during bargaining processes

The Fair Work Ombudsman dispute resolution role

The Fair Work Ombudsman has jurisdiction over complaints regarding:

• Pay and entitlements
• Employers breaching workplace law
• Discrimination

Complainants must be covered by the national workplace system. The Ombudsman strives to resolve disputes through consensual workplace processes, supported by Fair Work Inspectors who:

• Investigate complaints
• Conduct fact-finding
• Facilitate assisted voluntary resolution
• Proceed to full investigation and mediation when necessary

If investigation reveals legal breaches, the inspector can issue notice to remedy the breach. If the party fails to comply, the matter may proceed to court.

NSW Industrial Relations Commission dispute resolution role

At state level, the NSW IRC investigates alleged breaches of state industrial legislation, awards, and enterprise agreements. It will:

1. Order a compulsory conference between parties
2. Conduct conciliation
3. Employ arbitration only if conciliation fails

NSW IRC orders are binding on the parties.

The role of courts and tribunals

Fair Work Australia

As the federal industrial relations tribunal, Fair Work Australia (FWA) resolves disputes including:

• Enterprise bargaining disputes
• Industrial action disputes
• Breaches of workplace law

FWA can facilitate voluntary workplace-level dispute resolution between employers and employees. When voluntary efforts fail, it can arbitrate disputes as outlined above. It also hears and determines:

• Unfair dismissal claims
• Matters arising from industrial action

Federal Court and Federal Magistrates' Court

The Industrial Relations Court of Australia was established in 1993 as a superior court equal in status to the Federal and Family Courts. However, the Workplace Relations Act 1996 (Cth) (now repealed) transferred its jurisdiction to the Federal Court of Australia.

The Fair Work Act 2009 (Cth) created:

• A Fair Work Division of the Federal Magistrates' Court
• A Fair Work Division of the Federal Court

The Fair Work Act provides for certain matters to be heard as small claims (claims less than $20,000) in the Federal Magistrates' Court. This allows employees to pursue recovery of unpaid entitlements or compensation through:

• Relatively informal proceedings
• No legal representation without court permission
• Flexible evidence rules where the court can investigate matters as it sees fit

Small claims procedures minimize costs and are less intimidating for many people.

NSW Industrial Relations Commission

At state level, the Industrial Court of New South Wales exercises the judicial function of the NSW Industrial Relations Commission. It has:

• The same status as the NSW Supreme Court
• Appellate jurisdiction (hearing appeals from lower court decisions on industrial matters)
• Exclusive jurisdiction regarding industrial matters (it is the only court that can arbitrate industrial disputes)

The types of matters it hears include:

• Unfair contract claims
• Offences under the Industrial Relations Act 1996 (NSW)
• Proceedings for breaches of awards and agreements, including underpayment of entitlements
• Superannuation appeals
• Unfair dismissal claims
• Criminal prosecution of occupational health and safety offences under the Occupational Health and Safety Act 2000 (NSW)

The importance of courts and tribunals

Courts and tribunals play a significant role in industrial dispute resolution. The use of courts as final arbitrators lends weight to decisions, and parties must comply or face legal consequences. Courts provide certainty by:

• Establishing legal principles
• Clarifying legal questions
• Identifying and resolving industrial issues as they emerge
• Ensuring law continues reflecting community standards
• Satisfying changing requirements of federal or state industrial systems

The role of government organizations

NSW Industrial Relations Commission

The NSW IRC's role extends beyond hearing disputes. It establishes employment conditions and wages by:

• Making industrial awards
• Approving enterprise agreements for state system employees

In its administrative role, the Commission can:

• Review awards and enterprise agreements, ensuring compliance with the "no net detriment test" and absence of discriminatory provisions
• Revise awards to comply with new legislation
• Register and regulate employer associations and employee organizations (e.g., trade unions), including enforcement proceedings and challenges to rule validity

Fair Work Australia

Fair Work Australia (FWA) oversees the federal industrial relations system. Beyond its judicial functions, its administrative role includes:

• Varying awards
• Making minimum wage orders
• Reviewing and approving enterprise agreements for federal system workplaces, ensuring they meet the Better Off Overall Test (BOOT)
• Assisting with agreement modifications when businesses are transferred or new businesses created
• Providing assistance and advice about industrial relations laws through its telephone helpline

The Fair Work Ombudsman

Under s 682(1)(a) of the Fair Work Act 2009 (Cth), the Fair Work Ombudsman's functions are to promote "harmonious, productive and cooperative workplace relations" and ensure compliance with the Act, awards, agreements, and orders. It does this by:

• Providing education, advice, and assistance to employees, employers, outworkers (employees who work at home or another place besides their employer's premises, or independent contractors in the textile, clothing, or footwear industry who work at home or other premises), and registered organizations
• Publishing information on the federal industrial relations system
• Operating offices throughout Australia and online advisory services
• Encouraging employees and employers to take initiative in resolving complaints

The Ombudsman has power to:

• Investigate and enforce breaches of the Act, awards, agreements, and orders
• Inspect and copy documents at employer premises (through Fair Work Inspectors)
• Represent employees or outworkers in proceedings before courts or FWA

The role of trade unions

Trade unions are employee organizations. Groups with common interests enjoy greater bargaining power than individuals, and unions have been instrumental in achieving:

• Better workplace safety
• Superannuation
• A 38-hour working week
• Penalty rates
• Rest breaks
• Other employee benefits

Unions typically represent employees from similar occupations or industries. They may engage in discussions with employers regarding working conditions, awards, and enterprise agreements. All employees have the right to join unions if they wish. Examples include:

• Electrical Trades Union: represents workers in the electrical trades
• Construction, Forestry, Mining and Energy Union: represents people in building, timber, mining, and energy production industries
• Australian Workers Union: originally formed to represent shearers and miners, later expanded into manufacturing, and today covers aviation, food processing, and retail sectors
• Media, Entertainment and Arts Alliance: represents workers in film, theatre, journalism, and wider publishing industry

Unions acting collectively

Unions may act together pursuing common goals. The NSW State Wage Case of 2009 provides an example where Unions NSW applied to the NSW Industrial Relations Commission for a general wage increase in awards. Unions NSW is the state peak body (an association made up of organizations with similar interests and aims that sets policy and coordinates common activities) for unions, comprising more than 67 unions.

The Australian Council of Trade Unions (ACTU) is the national peak body for all Australian unions, formed in 1927. The ACTU:

• Represents Australian labor organizations internationally
• Articulates positions on human rights and other issues
• Has been influential in campaigns furthering workers' rights within Australia, such as the 2007 federal election campaign focusing on WorkChoices' detrimental effects on employees

Unions as lobby groups

Unions may act as lobby groups to pressure government for reform. The ACTU has successfully backed government financial assistance for working parents: as of January 2011, new parents receive 18 weeks' payment at minimum wage rates (nearly $10,000). Unions continue lobbying for better parental leave for both fathers and mothers, including longer periods of employer-provided paid leave.

The role of employer associations

Employer associations comprise employers within the same or related industries. They can:

• Represent members during negotiation of new enterprise agreements
• Present cases to relevant industrial relations commissions or courts supporting members' interests

Employer associations include:

• Australian Chamber of Commerce and Industry
• Chamber of Commerce (NSW)
• Business Council of Australia
• Master Builders Associations of Australia and various states and territories

The role of non-government organizations

Non-government organizations (NGOs) may:

• Provide training and education to raise awareness of industrial relations, employment conditions, and workplace safety issues
• Engage in research and make submissions to government and appropriate bodies
• Undertake political campaigns to pressure government

Australian Human Rights Commission

The Australian Human Rights Commission is an independent statutory organization established in 1986 to act as the human rights "watchdog." It:

• Administers federal anti-discrimination statutes (Age Discrimination Act 2004 (Cth), Disability Discrimination Act 1992 (Cth), Sex Discrimination Act 1984 (Cth), Racial Discrimination Act 1975 (Cth))
• Has powers under the Fair Work Act 2009 (Cth) to make submissions to Fair Work Australia for consideration in reviewing modern awards and enterprise agreements

The Commission can:

• Accept complaints about workplace discrimination
• Generally conciliate disputes
• Refer matters to the Fair Work Division of the Federal Court

Other NGOs

Safe Work Australia is an independent statutory body whose main aims are promoting safer workplaces and improving occupational health and safety.

The Human Rights Council of Australia is a private organization that:

• Monitors and publicizes government performance
• Provides links between Australian and international human rights activists
• Works to promote Australian human rights policy development, including workplace issues such as discrimination and safety

The National Women's Justice Coalition promotes women's equality before the law through education and lobbying.

The International Labour Organization (ILO), a United Nations agency, aims to:

• Encourage member nations to undertake common action protecting workers' rights worldwide
• Draft and oversee international labor standards
• Promote compliance with these standards

The role of the media

The role of media and associated technologies has changed significantly over the past decade. New communication technologies mean all workplace stakeholders are better informed and better positioned to gather public and government support for their causes.

Employer associations and trade unions use the internet extensively to:

• Inform the public about current claims and negotiations
• Survey employees regarding work hours and workplace conditions
• Use information gathered as the basis for test cases

The IRC and Fair Work Australia effectively use new technologies to:

• Inform employees and employers about their rights and obligations under workplace law
• Provide additional support services

Internet use in the workplace: issues and regulation

Internet use as a workplace communication method and information source has raised various issues, particularly regarding employer monitoring and regulation of employee internet use.

Employer risks: Employers face risks in not monitoring email and internet traffic. In cases of sexual harassment (unwelcome and uninvited behavior of a sexual nature likely to intimidate, humiliate, or offend the person toward whom it is directed), employers may be held liable if they have not taken reasonable steps to prevent distribution of offensive material.

Employee privacy: Employees using the internet at work for private correspondence and web browsing may not realize their activity is not protected from employer scrutiny. There is no common law right to privacy in Australia. The federal Office of the Privacy Commissioner has developed guidelines for employers to ensure staff understand:

• The employer's expectations
• What is permitted at work
• What will be done with personal information collected through monitoring

Case study: union use of workplace email

Remuneration

Remuneration refers to an employee's salary package, which may include:

• Pay
• Superannuation
• Share offers
• Educational expenses
• Car and rental assistance

The remuneration package must satisfy the NES regarding minimum award rates of pay and entitlements. It may also include an "incentive package" based on employee performance.

Superannuation Guarantee

The Superannuation Guarantee Scheme was established in the early 1990s under the Superannuation Guarantee (Administration) Act 1992 (Cth). Its main aim is ensuring employees have adequate funds to support them in retirement.

The scheme requires employers to contribute a sum equivalent to a percentage of the employee's annual salary to a fund that will be preserved (inaccessible to either employer or employee) until the employee retires and reaches "preservation age" (determined by year of birth).

Employees can also make personal contributions to their superannuation fund. These contributions can be accessed before retirement but will be subject to a tax penalty.

Remember!