Awards

17.72 An award is an industrial instrument that sets out minimum terms and conditions in a particular industry or occupation, in addition to any statutory minimum required. Under the national industrial relations system there are currently two main types of awards:

• modern awards; and

• award-based transitional instruments (including former federal and state awards) which are currently being reviewed.

17.73 Beginning in 2008, the Australian Industrial Relations Commission, replaced by FWA, conducted an award modernisation process aimed at reviewing and rationalising existing awards to create a system of ‘modern awards’.^[63] As a result of this process, there are now 122 industry and occupation modern awards that commenced on 1 January 2010, many of which include transitional provisions.

17.74 FWA is currently reviewing remaining award-based transitional instruments that apply to a single enterprise and where the employer is a constitutional corporation, including federal awards created before 27 March 2006 and former state awards now incorporated under the national system (which became notional agreements preserving state awards).^[64]

17.75 In light of the ongoing award modernisation process, and the fact that most national system employees are now covered by modern awards, the focus of this Discussion Paper is on modern awards.

Modern awards

17.76 Under the Fair Work Act, a national system employee who is not covered by an enterprise agreement^[65] and is not a ‘high income employee’^[66] may be covered by a modern award.^[67] Evidence suggests that women are likely to be more award-reliant than men.^[68]

17.77 A modern award is an industrial instrument that sets out minimum terms and conditions for a particular industry or occupation in addition to the statutory minimum outlined by the NES. A modern award cannot exclude any provisions of the NES but can provide additional detail in relation to the operation of an NES entitlement. In general, a modern award applies to employees in a particular industry or occupation and is used as the benchmark for assessing enterprise agreements before they are approved by FWA.

17.78 The Fair Work Act draws a distinction between where a modern award covers a an employee, employer, or organisation—where it is expressed to cover them—and where it applies—if it actually imposes obligations or grants entitlements.^[69]

17.79 The Fair Work Act prescribes matters which must, must not, and may, be included under a modern award.^[70] In a family violence context, the matters of relevance that are usually included in a modern award include:

• type of employment—for example, full-time, part-time or casual,^[71] as well as ‘terms about the facilitation of flexible working arrangements, particularly for employees with family responsibilities’;^[72]

• arrangements for when work is performed—for example, variations to hours of work, rostering, notice periods and working hours;^[73]

• leave;^[74]

• procedures for consultation, representation and dispute settlement;^[75] and

• flexibility—although IFAs may only be made to vary the effect of modern award terms including arrangements for when work is performed, rates, allowances and leave loading.^[76]

17.80 Under the current allowable matters there is some scope for a modern award to recognise and accommodate the needs of victims of family violence.

Modern award objectives

17.81 Section 134 of the Fair Work Act contains the modern awards objective that applies to the performance or exercise of FWA’s modern award powers. Under the objective, FWA must ensure that modern awards, together with the NES:

provide a fair and relevant minimum safety net of terms and conditions, taking into account:

(a) relative living standards and the needs of the low paid; and

(b) the need to encourage collective bargaining; and

(c) the need to promote social inclusion through increased workforce participation; and

(d) the need to promote flexible modern work practices and the efficient and productive performance of work; and

(e) the principle of equal remuneration for work of equal or comparable value; and

(f) the likely impact of any exercise of modern award powers on business, including on productivity, employment costs and the regulatory burden; and

(g) the need to ensure a simple, easy to understand, stable and sustainable modern award system for Australia that avoids unnecessary overlap of modern awards; and

(h) the likely impact of any exercise of modern award powers on employment growth, inflation and the sustainability, performance and competitiveness of the national economy.^[77]

17.82 Further, the Explanatory Memorandum to the Fair Work Bill provides, in relation to modern awards, that:

In ensuring the minimum safety net of terms and conditions is relevant, it is anticipated that FWA will take account of changes in community standards and expectations, and that the terms and conditions will be tailored (as appropriate) to the specific industry or occupation covered by the award.^[78]

Existing award provisions in other jurisdictions

17.83 The key Australian precedent for the recognition of family violence in awards is the Crown Employees (Public Service Conditions of Employment) Award 2009 (NSW), amended in 2011, under which NSW public servants are entitled to five days special leave and use of other forms of leave for the purposes of responding to family violence, as well as flexible working arrangements.

17.84 While this award is a state award, the provision provides a useful guide as to the way an award may incorporate a family violence provision. The provision is reproduced below.^[79]

17.85 The award was also varied to incorporate a definition of ‘domestic violence’ as defined in the Crimes (Domestic and Personal Violence) Act 2007 (NSW) and to provide that, where an employee’s leave for matters arising from domestic violence has been exhausted,

the Department Head shall grant up to five days per calendar year to be used for absences from the workplace to attend to matters arising from domestic violence situations.^[80]

17.86 There are a range of other NSW awards which have now been varied to include family violence provisions.^[81]

Variation and review of modern awards

17.87 Under the Fair Work (Transitional Provisions and Consequential Amendments Act 2009 (Cth), FWA is required to undertake an initial review of modern awards to be conducted from 1 January 2012.^[82] The scope of the review is limited to FWA considering whether modern awards achieve the modern awards objectives and are operating effectively, without anomalies or technical problems arising from the award modernisation process.

17.88 In addition, s 156 of the Fair Work Act provides for review of each modern award every four years. The first review of this kind must commence as soon as practicable after 1 January 2014. The Explanatory Memorandum to the Fair Work Bill states that ‘these reviews are the principal way in which a modern award is maintained as a fair and relevant safety net of terms and conditions’.^[83]

17.89 In the course of the reviews, FWA may make determinations varying modern awards, making additional modern awards or revoking existing modern awards. FWA may also vary or revoke a modern award outside of the four-yearly review process if necessary to meet the modern award objectives.^[84]

Submissions and consultations

17.90 In the Employment Law Issues Paper, the ALRC asked whether existing terms in modern awards are sufficient to respond to the needs of employees experiencing family violence.

17.91 In addition, the ALRC considered ways in which modern awards might incorporate family-violence related provisions, whether through the use of flexibility terms or whether a new allowable matter may be required under modern awards. In particular, the ALRC asked for stakeholder comment on whether s 139(1) of the Fair Work Act should be amended to include an additional allowable matter dealing with family violence.

17.92 The majority of stakeholders who addressed this issue expressed the view that existing terms in modern awards are not sufficient to respond to the needs of employees experiencing family violence.^[85] Many stakeholders expressed the same views underlying support for amendment to the NES and the inclusion of family violence clauses in enterprise agreements.

17.93 Several stakeholders also emphasised that ‘at the outset it should be noted that women are both more likely to be award-reliant than men, and more likely to experience family violence’.^[86] Some also specifically suggested that modern awards be amended in line with the NSW public sector awards containing ‘effective and specific family violence clauses’.^[87]

17.94 Stakeholders argued that the current IFA and leave provisions in modern awards are inadequate and are not broad enough to allow employees experiencing family violence to take time off work or reorganise work arrangements to attend appointments, access services and care for children.^[88] Similarly, according to the Redfern Legal Centre,

there appears to be wide variation in the use of flexible working arrangements depending on which industry, the status and role of the employee, and the views of individual managers. Relying on the flexibility provisions alone will not assist all workers dealing with family violence.^[89]

17.95 The ADFVC submitted:

Although the Fair Work Act states that modern awards may provide for averaging of hours of work over a certain period, suggesting scope for temporary variation of regular hours, this merely provides a mechanism for the employer to allow scheduling changes where they are mutually agreeable. It does not provide a right or entitlement to temporary (or ongoing) rearrangement of shifts, hours or spans for employees who need time off for court or other appointments, or simply cannot work their regular scheduled hours due to the emotional impact of the violence on their work capacity.^[90]

17.96 With respect to considering the ways in which modern awards might better protect victims of family violence, stakeholder views were mixed about incorporating a reference to family violence as an allowable matter under s 139(1) of the Fair Work Act, or whether the provision was already sufficiently broad to allow the inclusion of family violence provisions in modern awards.

17.97 A number of stakeholders submitted that it is necessary to amend s 139(1) to include a new allowable matter and/or make specific reference to family violence in the allowable matters.^[91] Specifically, stakeholders suggested the amendment would allow the inclusion of clauses in relation to family violence and act as a safeguard for victims of family violence covered solely by an award.^[92]

17.98 For example, the AHRC stated:

Amending s 139(1) of the FWA to enable modern awards to expressly include the facilitation of flexible working arrangements for employees affected by domestic violence would provide these vulnerable employees with an important and useful condition.^[93]

17.99 The ADFVC suggested that s 139(1)(b) of the Fair Work Act be amended to include an additional sentence—‘particularly for employees with family responsibilities and employees experiencing family violence’.^[94]

17.100 Conversely, several stakeholders indicated that the terms of s 139(1) are already sufficiently broad. For example, the ACTU expressed the view that:

Section 139(1) of the Fair Work Act 2009 includes provisions for, inter alia:(b) the facilitation of flexible working arrangements, particularly for employees with family responsibilities;(c) variations to working hours; and(h) leave, leave loadings and arrangements for taking leave. As such, s 139 (1) should not impede the capacity of modern awards to include terms for flexible work and leave arrangements for family or domestic violence purposes … [Although] specific referral to family or domestic violence in s.139(1) would further clarify the rights of employees experiencing family or domestic violence.^[95]

17.101 Similarly, ACCI submitted that:

FWA is able to insert provisions which are more beneficial than the NES and there is no reason why unions or employees could not make an application under the Fair Work Act 2009 and for FWA to consider that application. Therefore, there is no legislative imperative to create a new allowable award matter, given the availability to deal with such terms within the existing provisions.^[96]

17.102 As was the case in response to other proposed amendments, stakeholders emphasised that moves to address family violence in modern awards need to be accompanied by the provision of additional information for both employees and employers and form part of a sustained education and awareness campaign.^[97]

17.103 Finally, in consultations and submissions the ALRC received numerous comments about the upcoming FWA reviews of modern awards. For example, in its submission, ACCI noted:

The creation of new modern awards was the result of an extensive and some would say, exhaustive, consultation process before the AIRC during 2008 to 2009 … Whilst the process has concluded with the creation of 122 new awards, the process is ongoing with applications by unions and employers, to vary modern awards still occurring. Employers would consider that the ink is barely dry on modern awards and it would be unfair for all parties to be required to embark on a new modernisation process because of the inclusion of a new allowable award matter in the legislation. There is a two yearly review coming up in 2012 which will review all modern awards in any event.^[98]

ALRC’s views

17.104 The ALRC considers that s 139(1) of the Fair Work Act is sufficiently broad to allow scope for the inclusion of family violence-related clauses in modern awards. For example, it provides for the inclusion of terms about: type of employment; arrangements for when work is performed; leave; and flexibility. However, at a Commonwealth level such clauses have not been included to date and, as a result, existing terms in modern awards are insufficient to respond to the needs of employees experiencing family violence.

17.105 The ALRC considers the inclusion of such clauses is consistent with the modern awards objective of promoting social inclusion through increased workforce participation—primarily by ensuring employees experiencing family violence can make flexible working arrangements or access leave to deal with circumstances arising from family violence, which increases the likelihood of them retaining their employment.

17.106 The tension between the need to ensure that modern awards are relevant and take account of changes in community standards and expectations, on the one hand, with the need to ensure a simple and stable modern award system, on the other, appears to be resolved in part by the requirement that FWA conduct reviews of the modern award system. FWA will undertake reviews of modern awards in 2012 and 2014 and in the course of those reviews FWA may make determinations varying modern awards.

17.107 Accordingly, the ALRC considers that, rather than proposing the inclusion of a new allowable matter (which is probably unnecessary in any event), or outlining the form in which family violence-related clauses may be incorporated into modern awards, it is more appropriate to defer consideration of these issues as part of the FWA reviews in 2012 and 2014. Therefore, the ALRC proposes that FWA should, in the course of its 2012 and 2014 reviews of modern awards, consider the way in which family violence may be incorporated into modern awards. The provision in the Crown Employees (Public Service Conditions of Employment) Awards 2009 (NSW) provides a useful example.