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High Court challenge to personal leave entitlements

Summary

The Government has announced it is seeking leave to appeal the recent full Federal Court decision to the High Court regarding the entitlement of all employees to 10 calendar days of personal leave per year. The case has far-reaching implications for all employers and employees and will be carefully monitored as it progresses.

For employers

  • Under the current full Federal Court precedent, all employees are entitled to 10 calendar days personal leave per year
  • Consider amending employment contracts to include a reference to NES entitlements for personal leave
  • If in doubt about your obligations, seek legal advice

In a landmark case last month, the full Federal Court ruled that shift workers who were working 12-hour shifts were entitled to 10 calendar days of personal leave per year, amounting to 120 hours, instead of the 76 hours the employer (Mondelez International) believed applied under the NES (based on 38 ordinary hours per week)[1].

The Mondelez employees were all working 36 hours a week- some by working 3 x

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Redundancy and redeployment; minimising unfair dismissal

 

 

 

 

 

In Short: 

  • Redundancy provisions bestow a positive obligation on employers to fully explore opportunities within an employer’s wider corporate structure to redeploy.
  • For employers, proactively pursuing and proposing alternate employment opportunities before redundancy termination, will minimise the risk of unfair dismissal or adverse action litigation being brought by employees.

In Depth:

An unfair dismissal claim is not available in circumstances of genuine redundancy. Employers must however be mindful of the requirement to redeploy where it is considered reasonable in all circumstances.

Genuine redundancy arises if:

  • an employer no longer requires an employee’s job to be performed by anyone because of changes in the operational requirements of the employer’s enterprise; and an employer has complied with any obligation in a modern award or enterprise agreement that applied to the employment to consult about the redundancy. The circumstances of genuine redundancy are qualified by the requirement to redeploy if it would have been reasonable in all the circumstances to redeploy within the employer’s enterprise or the enterprise
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Labour Hire Back on the Agenda

Labour Hire Back on the Agenda

Earlier this year, the Labour Hire Licensing Act 2018 (Victoria) came into effect making Victoria the third state (after South Australia and Queensland) to enact legislation requiring labour hire providers to hold a licence.

Licences are granted by the Victorian Labour Hire Licensing Authority for a 3-year period, provided the labour hire provider passes the “fit and proper person” test (demonstrating compliance with industrial and taxation laws).

In a recently-publicised briefing document provided to the IR Minister after the federal election in May 2019, the Government has agreed to provide funding to the Fair Work Ombudsman to enable it to set up a National Labour Hire Registration Scheme early in 2020.

The Scheme was recommended by Professor Allan Fels, head of the migrant worker taskforce, with a view to reducing worker exploitation in four high risk sectors- namely horticulture, meat processing, cleaning and security.

Consultation on the proposed national scheme will need to occur before any changes are introduced.

Once the new scheme is

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FWC send clear message: termination by text is unacceptable

In two separate cases decided this week, the Fair Work Commission has made it clear that termination of employment via text message is unlikely to amount to a fair dismissal. The method has been variously described by the Commission as “unconscionably undignified”, “hopeless”, “repugnant”, “unnecessarily callous” and “disgraceful and grossly unfair”.

In the first case[1], an employee received a text message stating that his employment was terminated with immediate effect and that he was required to work out his notice period. The text message followed a discussion with the employer in which the employee was told that his rate of pay would be cut from $31.78 per hour to $25 per hour. The employee did not agree to the paycut and received the text message after leaving the workplace.

Deputy President Sams was scathing of the employer both in terms of the reasons provided for the dismissal and in particular the method of dismissal. He described the dismissal by text message as “deliberate and calculated” and “breathtaking in

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Corporate whistleblowers to get better protection

From 1 July 2019 new whistleblower legislation comes into effect creating better protection for whistleblowers under the Corporations Act 2001(Cth), Taxation Administration Act 1953 (Cth), Banking Act 1959 (Cth) and Insurance Act 1973 (Cth).

The changes apply to current and former employees and suppliers of public companies or large proprietary companies[1] making disclosures about wrongdoing by the entity. The protections extend to disclosures by family members of employees or suppliers and the range of misconduct about which a disclosure may be made will also broadened.

However this does not mean that all persons or disclosures will be protected. Litigation in this area to date often involves attempts to invoke whistle-blower protection for matters that are better described as workplace disputes or “personal work-related grievances” that should properly be addressed within the workplace. The new laws preserve this distinction while increasing the protections for eligible persons who make a protected disclosure about a regulated entity. 

One such case is currently before the Federal Court[2] involving an ex-employee of the Commonwealth Bank of Australia who

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FWC announces a 3% wage increase - effective from 1 July 2019

The Fair Work Commission has released its 2019 Annual Minimum Wage Decision, awarding a 3% increase to the national minimum wage and award-reliant employees.

The FWC decision increases the national minimum wage to $740.80 – or $19.49 an hour. This constitutes an increase of $21.60 a week or 57 cents an hour.  All award rates of pay will increase by 3% with effect from the first pay period commencing on or after 1 July 2019.

The FWC panel stated that while business conditions have moderated from the high levels in early 2018, the forecast is for continued growth in the economy and strong performance in the labour market. The panel considered that its forecast provided an opportunity to improve the living standards of those relying on award rates and the minimum wage. Noting the disproportionately large number of women in this group, the panel (consisting of five men and two women) expressed a belief that an increase would assist in reducing the gender pay gap.   

It was acknowledged that

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FWO cashed up to investigate and prosecute sham contract arrangements

The Federal government has announced the Fair Work Ombudsman will receive $2.3 million each year for the next 4 years to establish a dedicated unit to address sham contracting.

While part of the objective is to increase education and encourage compliance, the unit will also dedicate funds to investigation of and litigation against employers who are participating in sham contractor arrangements.

Sham contractor arrangements refers to a situation where a worker is being engaged as a contractor but is in fact an employee. The effect of this is that the employer avoids its usual employment obligations such as paid leave, notice and redundancy.

It is well established that courts will look further than the written agreement between the parties to determine the true nature of the working relationship. Considerations including who has effective control of how and when the work is done, whether the worker performs work for others and whether the worker can refuse or delegate the work all form part of the assessment of the true nature of

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Employer liable for sexual harassment by employee

The Victorian Civil and Administrative Tribunal recently heard a sexual harassment claim by an employee under the Equal Opportunity Act 2010 in which the employer was named as second respondent.[1] The complaint of sexual harassment was made out and the employee and employer were jointly ordered to pay damages of $130,000, with the employer ordered to pay an additional $20,000 in aggravated damages.

The employee’s claim was that she had been verbally and physically sexually harassed by a co-worker at the workplace on a number of occasions. She also claimed there was an incident when she was unwell at work and the employee in question was asked by the employer to drive her home where he again sexually harassed her.

The evidence was that the complainant had told the employer 3 days after the event that she had been sexually harassed by her co-worker. She then sent an email confirming her account of events.

After finding that sexual harassment had occurred, Judge Harbison referred to s.109 of the Act

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When can an employer require a medical examination

Clearly employees are entitled to be absent on approved leave and to return to their role when the period of leave has expired. However, when the absence becomes long-term, often due to an accident or illness, employers can find themselves in the difficult situation of being unable or unwilling to keep the position open indefinitely, but unsure of their options around managing the employee.

The Fair Work Act 2009, along with the Fair Work Regulations 2009, clearly sets out that an employer is prohibited from terminating an employee for reason of a “temporary” absence due to illness or injury, defined as a continuous period of 3 months or a total of 3 months in a 12-month period.[1] This period is longer if the employee is on workers compensation and in those cases will vary depending on the applicable state legislation.

However, the expiry of the “temporary” period does not give the employer an automatic right to terminate the employee. The employer is required to have a valid

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Understanding bullying and reasonable management action

Informing employees of underperformance can be a difficult task for employers, particularly when employees don’t handle the feedback well. It is a common scenario that disgruntled employees retaliate by making a ‘bullying’ claim against their supervisors. The good news is that employers are well within their rights to implement processes to rectify poor performance to steer workers back on track. Provided that the steps taken by the employer constitute reasonable management action that has been carried out in a reasonable manner, the worker’s bullying claim will not succeed.

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How does the FWC determine unfair dismissal cases

In a recent case,[1] the FWC has sent a reminder that it is “not incumbent on an employer to take any particular steps" when carrying out terminations. The appropriateness of the steps taken in each case will depend upon the circumstances of the situation. However, in dealing with unfair dismissal applications, the FWC relies on the Fair Work Act 2009 (“FWA”) to determine whether a dismissal is harsh, unjust or unreasonable.

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Employers more accountable for decisions about flexible work arrangements

A new model term dealing with how an employee’s request for flexible working arrangements must be dealt with will be inserted into all modern awards from 1 December 2018.

The model term applies to a request by an employee for a change in working arrangements under section 65 of the Fair Work Act 2009 (“the Act”). The Act provides that an employer can only refuse a request on ‘reasonable business grounds’.

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FWO triumphs in its first racial discrimination prosecution

The role of the Fair Work Ombudsman includes ensuring employers are compliant with Australian Workplace Laws and safeguarding the protection of vulnerable workers from exploitation. In addition to an already extensive list of powers, the FWO has jurisdiction to investigate claims of workplace discrimination on the basis of factors such as race, sex, age and pregnancy.

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Is it OK to sack your employees via phone, text or email

In most circumstances, dismissals take place during pre- arranged face to face meetings between employers and employees.  Employers are required to afford procedural fairness, and this usually involves meeting with the employee to discuss the circumstances around the termination. In saying that, there are circumstances when an employer may validly terminate an employee through less traditional means, such as through a phone call or email.

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Bizarre Facebook messenger conversation leads to surprising sacking

It is well established that employers cannot decide to end the employment relationship at the drop of a hat. In most cases there must be a valid, sound, and defensible reason behind the dismissal, which is to be communicated to employees in the appropriate manner and in accordance with proper process.

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A casual approach to casuals could cost you

We routinely deal with employer issues around casual employment. This is not surprising given the fact that there is no definition of a casual employee in the Fair Work Act, as well as the largely misunderstood notion of who, what and when a casual.  However, a recent decision of the Federal Court has introduced some additional - and costly - hazards into these murky waters.

The case concerns an employee engaged as a truck driver by a labour hire company.

The employee was engaged as a casual and was paid at a rate that included a casual loading paid in lieu of entitlements afforded to permanent employees – notice of termination, leave, etc.

The employee worked for around 4 years under this arrangement.

The employee claimed he was not a casual and was employed on a full time basis.

Despite a number of factors indicating against this, the Court found that the employee was not engaged as a casual, and he was therefore entitled to be paid for leave accrued

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The importance of policy communication and training

In cases of an employee policy breach, courts have supported the principle that it is not enough for an employer to simply point towards the existence of a policy in an effort to justify disciplinary action. Generally speaking, policies are fruitless unless employers can demonstrate that employees have easy access to policy documents, that regular training is provided and that policies (and changes) are effectively communicated to all employees.

In a recent case before the FWC,[1] a longstanding employee of 17 years with a positive work-record was summarily dismissed for breaching his employer’s "zero tolerance" mobile phone policy, when the employee used his phone in what his employer considered a ‘food production area’. The next day, the employee was called into a meeting where he was instantly dismissed.

The employee claimed that the employer had already decided to terminate before the meeting, because it “wanted to make an example out of him”. He said that he was aware that mobile phones were not permitted in the food production area,

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