Commonwealth Numbered Regulations - Explanatory Statements

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WORKPLACE RELATIONS REGULATIONS (AMENDMENT) 1996 NO. 307

EXPLANATORY STATEMENT

Statutory Rules 1996 No. 307

Issued by the Authority of the Minister for Industrial Relations

Workplace Relations Regulations (Amendment)

Section 359 of the Workplace Relations Act 1996 (the Act) provides that the Governor-General may make regulations prescribing (inter alia) matters that are necessary or convenient to be prescribed for carrying out or giving effect to the Act.

The Regulations will commence on the date of commencement of item 5 of Schedule 6 to the Workplace Relations and Other Legislation Amendment Act 1996. It is intended that that item, and the remainder of Schedule 6, will come into operation on 31 December 1996.

The Regulations give effect to various matters which are necessary or convenient to be prescribed, including:

*       excluding certain categories of employees from the operation of various termination of employment provisions, pursuant to section 170CC;

*       prescribing a filing fee for termination of employment applications to the Australian Industrial Relations Commission

*       clarifying the meaning of what constitutes a temporary absence because of illness or injury for the purposes of prohibiting terminations of employment on certain grounds;

*       clarifying the meaning of what constitutes serious misconduct, for the purposes of terminating employment without the requirement to give a minimum period of notice or pay in lieu;

*       stating what events must be disregarded in ascertaining an employee's period of continuous service for the purpose of determining the minimum period required to give notice. and

*       exempting a vendor from the requirement to give minimum periods of notice or pay in lieu of notice in circumstances where there is a succession, assignment or transmission of business. Details of the Regulations are attached.

ATTACHMENT

DETAILS OF THE INDUSTRIAL RELATIONS REGULATIONS (AMENDMENT)

Regulation 1.1 provides that the regulations will commence on the date of commencement of item 5 of Schedule 6 to the Workplace Relations and Other Legislation Amendment Act 1996 (the WROLA Act). It is intended that the whole of Schedule 6 to the WROLA Act will come into operation on 31 December 1996.

This is a formal provision, providing that the regulations amend the Workplace Relations Regulations (the existing regulations).

Regulation 3.1 of the amending regulations inserts a definition of the term "old IR agreement". The term covers various forms of industrial agreements made under Commonwealth legislative provisions which are no longer in force.

Regulation 4.1 of the amending regulations amends the definitions set out in regulation 30A of the existing regulations.

New paragraph 30BA(1)(c) of the regulations excludes daily hire employees from the operation of specified termination of employment provisions. The expression "daily hire employee" was defined in former regulation 30A. As a result of a changed definition of "award" in the Act, a number of changes to this definition are made.

Regulations 4.1, 4.2 and 4.3 of the amending regulations amends subparagraphs 30A(a)(i), (ii) and paragraph 30A(b) of the former definition to provide that a "daily hire employee" is an employee:

*       whose employment is regulated by an award, a certified agreement, an Australian workplace agreement (AWA), a State award, a State employment agreement or an old IR agreement (a definition of this term is inserted by regulation 3.1 of the amending regulations (see above)), and

*       whose employment under the award or agreement is normally terminated at the end of each day or shift, or able to be terminated by the giving of a day's notice (or less), and

*       who is working in an industry or occupation which, on 16 November 1994, was subject to an award, State award, State employment agreement or old IR agreement which provided for such method of termination.

Regulation 4.4 of the amending regulations omits the definition of 'employment agreement'. This is a consequential amendment resulting from the new definition of 'State employment agreement' contained in the Act.

Regulation 5.1 of the amending regulations omits former subregulations 30B(1) and (2), which set out categories of employees excluded from the operation of particular termination of employment provisions, and replaces them with new subregulations 30B(1), (2). A new subregulation 30B(4) is also inserted.

Paragraph 170CC(1)(a) of the Act provides that regulations may exclude from the operation of specified provisions of Division 3 of Part VIA of the Act 'employees engaged under a contract of employment for a specified period of time or a specified task'.

New paragraph 30B(1)(a) of the regulations provides that employees engaged under a contract of employment for a specified period of time are excluded from the operation of Subdivisions B, C, D, E and F of Division 3 of Part VIA of the Act. The distinction in the former regulation 30B(1)(a) between contracts entered into before and after 16 November 1994 is not relevant under the new regulations and was not maintained.

New paragraph 30B(1)(b) of the regulations provides that employees engaged under a contract of employment for a specified task are excluded from the operation of Subdivisions B, C, D, E and F of Division 3 of Part VIA of the Act.

New subregulation 30B(2) makes an exception to the exclusions set by paragraphs 30B(1)(a) and (b). Those exclusions do not apply if the main purpose of the engagement is, or was at the time of the employee's engagement, to avoid the employer's obligations under Subdivisions B, C, D or E of Division 3 of Part VIA of the Act.

Paragraph 170CC(1)(b) of the Act provides that regulations may exclude from specified provisions of Division 3 of Part VIA of the Act 'employees serving a period of probation or qualifying period'. New paragraph 30B(1)(c) of the regulations excludes from the operation of Subdivisions B, C, D, E and F of Division 3 of Part VIA of the Act:

*       employees serving a period of probation or a qualifying period of employment of three months or less, provided the duration of the period or the maximum duration of the period is determined in advance, and

*       employees serving a period of more than three months, provided the duration of the period or the maximum duration of the period is determined in advance and is of reasonable duration having regard to the nature and circumstances of the employment.

Paragraph 170CC(1)(c) of the Act provides that regulations may exclude from specified provisions of Division 3 of Part VIA of the Act 'employees engaged on a casual basis for a short period'. Paragraph 170CC(1)(e) of the Act provides that regulations may exclude from specified provisions of Division 3 of Part VIA of the Act employees in relation to whom the operation of the provisions would cause substantial problems. The application of many of the termination of employment provisions to casual employees is considered to cause substantial problems in the Australian context.

New paragraph 30B(1)(d) of the regulations excludes casual employees engaged for a short period from the operation of Subdivisions B, C, D, E and F of Division 3 of Part VIA of the Act. This means that short term casual employees are excluded from all termination of employment provisions.

Subregulation 30B(3) of the former regulations already provided that a casual employee is taken to be engaged for a short period in certain circumstances. Regulation 5.2 of the amending regulations amends former subregulation 30B(3) to ensure that a casual employee is taken to be engaged for a short period unless:

*       the employee is engaged by a particular employer on a regular and systematic basis for a sequence of periods of employment during a period of at least 12 months; and,

*       the employee has, or but for the decision by the employer to terminate the employee's employment, would have had, a reasonable expectation of continuing employment by the employer.

Paragraph 170CC(1)(e) of the Act provides that regulations may exclude from specified provisions of Division 3 of Part. VIA employees in relation to whom the operation of the provisions would cause substantial problems. The application of many of the termination of employment provisions to trainees is considered to cause substantial problems in the Australian context.

New paragraph 30B(1)(f) of the regulations would exclude trainees from the operation of Subdivisions B, Q D, E and F of Division 3 of Part VIA of the Act, where the traineeship agreement or approved traineeship is for a specified period (or is for any other reason limited to the duration of the agreement).

Paragraph 170CC(1)(e) of the Act provides that the regulations may exclude from specified provisions of Division 3 of Part VIA of the Act employees in relation to whom the operation of the provisions would cause substantial problems because of their particular conditions of employment or the size or nature of the undertakings in which they are employed.

Subsections 170CC(2), (3) and (4) of the Act in effect provide that, for the purposes of paragraph (1)(e), the regulations may exclude a class of employees not employed under award conditions whose remuneration exceeds an amount specified in the regulations.

Subsection 170CC(2) of the Act provides that the regulations may identify as a class of employees, for the purposes of paragraph 170CC(I)(e), employees not employed under award conditions and to whom subsection (3) or (4) applies. New subregulation 30B(1)(f) excludes from the operation of Subdivisions B, C, D, E and F of Division 3 of Part VIA of the Act employees not employed under award conditions and to whom subsections 170CC(3) and (4) apply.

Regulation 5.3 of the amending regulations inserts a new subregulation 30B(4), which provides that an employee is not taken to be employed under award conditions unless wages and conditions of employment of the employee are regulated by an award, certified agreement, AWA or old IR agreement that binds the employer of the employee.

Regulation 6.1 of the amending regulations omits former regulation 30BA, which excluded trainees from the operation of particular termination of employment provisions, and replaces it with new regulations 30BA and 30BB.

Regulation 30BA excludes particular types of employees from the operation of particular provisions relating to termination of employment.

New paragraph 30BA(1)(a) of the regulations provides that casual employees who are not taken to be engaged for a short period under subregulation 30B(3) are excluded from the operation of sections 170CL and 170CM, and Subdivisions D and E of Division 3 of Part VIA of the Act.

This means that a casual employee who is engaged by a particular employer on a regular and systematic basis for a sequence of periods of employment during a period of at least 12 months, and who would have had a reasonable expectation of continuing employment with the employer, will be excluded from notice and redundancy provisions but have access to a remedy for unfair dismissal (if within the traditional federal sphere).

Paragraph 170CC(1)(d) of the Act provides that the regulations may exclude from specified provisions of Division 3 of Pan VIA of the Act employees whose terms and conditions of employment are governed by special arrangements providing particular protection in respect of termination of employment either generally or in specific circumstances.

Paragraph 170CC(1)(e) of the Act provides that the regulations may exclude employees in relation to whom the operation of the provisions causes or would cause substantial problems because of their conditions of employment or the size or nature of the undertakings in which they are employed.

New paragraphs 30BA(1)(b) to (d) of the regulations exclude the following employees from the application of sections 170CL and 170CK and Subdivisions D and E of Division 3 of Pan VIA of the Act:

*       daily hire employees performing work in the building and construction industry; and

*       daily hire employees performing work in the meat industry in connection with the slaughter of livestock, and

*       employees whose employment is regulated by Schedule X (Marine Cooks, Marine Stewards and Seaman's Engagement System Schedule) of the award known as the Maritime Industry Seagoing Award 1983, as in force on 16 November 1994; and

*       weekly hire employees performing work in, or in connection with, the meat industry whose termination of employment is solely due to seasonal factors. The expression 'daily hire employee' is defined in regulation 30A (see above).

Paragraphs 170CC(3)(b) and (4)(b) of the Act allow the regulations to prescribe a "specified rate" or a manner of working out a specified rate, for the purpose of excluding non award employees whose remuneration exceeds such a rate. New regulation 30BB provides that the specified rate is $64 000 per annum, or that amount as indexed under regulation 30BF(below).

Regulation 7,1 of the amending regulations omits former regulation 30BC, which excluded certain casual and other employees from the operation of particular termination of employment provisions, and replaces it with new regulations 30BC, 30BD, 30BE and 30BF.

Subsection 170CC(4)(b) of the Act allows the regulations to establish a rate of remuneration which will be taken to apply to employees paid wholly or partly by piece rate or commission for the purpose of excluding non-award employees earning in excess of a certain amount of remuneration from the operation of particular termination of employment provisions.

New paragraph 30BC(1)(a) of the regulations provides that where such an employee was continuously employed by the employer in the 12 month period immediately before the termination (and was not on leave without full pay), the per annum rate applicable to the employee will be the amount of remuneration actually received over the period (or the amount which the employee was entitled to receive, whichever is the greater).

New paragraph 30BC(1)(b) of the regulations provides that where such an employee was continuously employed by the employer in the 12 month period immediately before the termination, and was on leave without full pay for some of that time, the employee is taken to have received an amount equal to the total of the amount actually received by the employee in that period, plus an amount worked out using a formula for the period or periods that the employee was on leave without full pay.

New paragraph 30BC(1)(c) of the regulations provides that where such an employee was continuously employed by the employer for a period less than 12 months immediately before the termination, the employee is taken to have been paid a per annum amount worked out using a formula based on the average daily rate of remuneration received.

Paragraph 359(2)(c) of the Act provides that the Governor-General may make regulations concerning 'the fees to be charged in relation to proceedings under this Act'.

New regulation 30BD requires a fee of $50 to be paid where an application is filed under subsection 170CE(1) of the Act. The fee is intended to discourage employees from making unfounded claims.

In accordance with the rules of the Commission, the Registrar may waive payment where imposition of the fee would cause serious hardship.

Subsection 170CH(8) of the Act provides that the maximum amount which the Commission may order to be paid to an employee who was employed under award conditions in lieu of reinstatement is:

*       the total amount of remuneration received by the employee from the employer in the period of 6 months immediately before the termination; and

*       any amount of remuneration taken to have been received by the employee if the employee was on leave without pay, or without full pay, in that 6 month period in accordance with the regulations.

New regulation 30BE provides that, for the purposes of paragraph 170CH(8)(b) of the Act, an employee is taken to have received the full amount of remuneration that the employee would ordinarily have received for any period during which they were on leave without full pay.

New regulation 30BF provides a formula for the indexation of the specified rate mentioned in paragraph 30BB(1)(a) of the regulations. This formula also applies to indexation of the maximum amount which the Commission can order to be paid in lieu of reinstatement under subsection 170CH(9) of the Act.

Subsection 170CH(9) of the Act provides that for employees not employed under award conditions the maximum amount which the Commission may order to be paid in lieu of reinstatement is the lesser of.

*       the amount of remuneration determined under subsection 170CH(8) of the Act, if that subsection applies; or

*       $32 000, as indexed from time to time in accordance with a formula prescribed by the regulations.

New subregulation 30BF(2) contains definitions of several terms relevant to the indexation formula. 'Base weekly earnings average' means the last amount published by the Australian Statistician before 1 July 1996 as an estimate (other than a preliminary estimate) of the average total weekly earnings (seasonally adjusted) for full the adult employees. 'Current. weekly earnings average', in relation to the indexation day, means the last amount published by the Australian Statistician before that day as an estimate (other than a preliminary estimate) of the average total weekly earnings (seasonally adjusted) for full time adult employees. 'Indexation day' means 1 July 1997 or 1 July in a later year. 'Indexation factor' refers to a specified formula.

Regulation 8.1 of the amending regulations omits former regulation 30C, which specified the matters to be disregarded in ascertaining whether an employee's period of service is continuous for the purposes of minimum notice provisions, and replaces it with new regulations 30C, 30CA, 30CB, 30CC and 30CD.

Subsection 170CK(2) of the Act provides that an employer must not terminate an employee's employment for any one (or more) of a number of reasons. The reasons include temporary absence from work because of illness or injury within the meaning of the regulations.

New regulation 30C provides that an absence based on illness or injury will only be taken to be temporary for the purpose of paragraph 170CK(2)(a) of the Act if a medical certificate is provided by the employee within 24 hours after the commencement of the absence (or within such longer period as is reasonable in the circumstances).

An absence will also be a temporary absence where the employee does not provide a medical certificate, but does comply with the terms of an award, certified agreement, AWA, old IR agreement, State award or State employment agreement which requires the employee to notify the employer of the absence (and, if necessary, to substantiate the reasons for absence).

'Medical certificate' is defined as a certificate signed by a medical practitioner which states that the employee is unable to work during a particular period. 'Medical practitioner' is defined as a person registered as such under a State or Territory law that provides for the registration or licensing of medical practitioners.

New subregulation 30C(2) provides that absence on grounds of illness or injury is not considered to be temporary for the purpose of paragraph 170CK(2)(a) of the Act if:

*       the absence extends for more than 3 months; or

*       total absences within a 12 month period (based on a single or separate illnesses or injuries) extend for more than 3 months.

An absence which extends beyond 3 months is considered to be temporary where the employee is on paid sick leave for the duration of the absence.

These regulations are not intended to override obligations of employers under specific legislative schemes which apply in relation to work related injuries. Conduct that constitutes serious misconduct

Section 170CM of the Act provides for the provision of a specified period of notice upon termination of employment, or payment in lieu of notice, unless the employee is guilty of serious misconduct, that is, misconduct of such a nature that it would be unreasonable to require the employer to continue the employment of the employee concerned during the required period of notice.

Subsection 170CM(7) provides that, without limiting the definition of serious misconduct, the regulations may identify particular conduct as serious misconduct.

New subregulation 30CA(1) provides that "serious misconduct" for the purposes of paragraph 170CM(1)(c) of the Act includes, but is not limited to:

*       wilful or deliberate behaviour by an employee, which is inconsistent with the continuation of the contract of employment, and

*       conduct which causes an imminent and serious risk to

-       the health or safety of any person, or

-       the reputation, viability, or profitability of the employer's business.

In addition to the above matters, new subregulations 30CA(2) and (3) provides that an employee who is shown to have engaged in a listed activity, in the course of his or her employment, will be taken to have engaged in serious misconduct, unless the employee can show that, in the circumstances, the conduct was not conduct which made employment in the notice period unreasonable. The non-exclusive fist of conduct includes:

*       theft;

*       fraud;

*       assault;

*       intoxication at work; and

*       a refusal to carry out a lawful and reasonable instruction which was consistent with the employee's contract of employment.

New subregulation 30CA(4) provides a definition of intoxication.

The objective of these regulations is to give guidance on the type of misconduct which is so serious that the requirement to provide a minimum period of notice does not apply.

Section 170CM of the Act provides that an employer must not terminate an employee's employment unless the minimum period of notice, or payment in lieu of notice is provided, or unless the employee is guilty of serious misconduct.

The period. of minimum notice required to be given by the employer depends on the length of continuous service with the employer. Subsection 170CM(3) of the Act allows regulations to be made prescribing matters that must be disregarded in ascertaining an employee's continuous service for the purposes of determining the required period of notice specified in subsection (2).

New subregulation 30CB(1) provides that the following matters or events are to be disregarded for the purposes of subsection 170CM(3):

*       any termination, suspension, stand down or other interruption imposed by the employer for the purpose of avoiding the employer's obligations to give minimum notice or pay in lieu of notice.,

*       any absence from work by the employee on authorised leave (as defined in existing regulation 30A);

*       any absence from work by the employee due to illness or injury (subject to subregulation (2));

*       any absence from work where there is reasonable cause (subject to subregulation (3));

*       any absence from work due to protected action as defined in section 170ML of the Act or due to AWA industrial action as defined in subsection 170WB(1) of the Act;

*       any other absence from work, unless the employer has given the employee written notice (within 14 days after the end of absence) that the absence will be taken to break the employee's continuity of service with the employer.

New subregulation 30CB(2) provides that any absence from work due to illness or injury or where there was reasonable cause will not break the employee's continuity of service unless the employee has notified the employer of the absence and has substantiated it as required by any relevant award, certified agreement, AWA, State award, State employment agreement. or old IR agreement. If there is no relevant award or agreement, an absence will not break continuity where the employee has informed the employer of the reasons and likely duration of the absence within 24 hours of the start of the absence.

New subregulation 30CB(3) provides that any absence from work due to protected action will not be disregarded if the Australian Industrial Relations Commission or a State industrial authority has decided that an absence is to be taken as breaking the employee's continuity of service.

Section 170CM of the Act allows employers to make a payment in lieu of minimum notice to employees. Subsections 170CM(4) and (5) specify the method of determining the amount which must be paid in lieu of notice. The amount must be worked out on the employee's ordinary hours of work, amounts ordinarily payable such as allowances, and any other amounts payable under the employee's contract of employment (subsection 170CM(5)). Subsection 170CM(6) allows regulations to be made prescribing the amounts taken to be payable under an employee's contract of employment in relation to employees whose remuneration before termination was determined wholly or partly on commission or piece rates.

New regulation 30CC provides that the amount taken to be payable under such an employee's contract of employment for the purposes of paragraph 170CM(5)(c) is the average amount actually received by the employee in the 3 month period immediately before the termination.

Subsection 170CM(8) of the Act provides that regulations may exclude from the requirement to give notice terminations of employment occurring in specified circumstances relating to the succession, assignment or transmission of the business of the employer concerned.

Some awards provide that service both before and after the transmission of business is deemed to be continuous for the purpose of calculating the amount of notice which must be provided by the purchaser of the business, Where an employee secures employment with the new owner of a business, a potential for 'double-dipping' exists as at the time of transmission, the employee would be entitled to notice under section 170CM of the Act for the period worked. If subsequently dismissed by the purchaser, the employee would be entitled to notice under the award not just for the period since the transmission, but for the entire period since employment with the business began (regardless of whether the employee had already been paid notice for some of this period).

To avoid this situation, new regulation 30CD provides that, in relation to the succession, assignment or transmission of a business, the obligation to pay notice by the previous owner will not arise if the employee is re-employed by the new owner of the business, and that new owner comes under an enforceable obligation to pay notice in respect of the earlier periods of service.

Regulation 9.1 of the amending regulations omits former regulation 30D, which related to the clarification of the circumstances in which an absence from work by an employee will be taken to be temporary. Regulation 30C replaces this regulation.

Regulation 10.1 of the amending regulations omits former regulation 30DAA, which dealt with the powers of the Commission in relation to consent arbitration.

Regulation 11.1 of the amending regulations omits former regulation 30DAB, which dealt with the grounds on which an appeal lies to a Full Bench of the Commission following the determination of a matter by consent arbitration conducted by a single Commissioner.

Regulation 12.1 of the amending regulations omits former regulation 30DA, which related to the formula for annual indexation of certain amounts. Regulation 30BF replaces this regulation.