Employment

214. In light of demographic changes in Australia and government objectives aimed at prolonging workforce participation, the ability of the employment law framework to respond to the needs of mature age employees and their employers is crucial. As stated by the Advisory Panel on the Economic Potential of Senior Australians, the ‘challenge is to re-shape workplaces’ and the employment law framework to facilitate the ongoing involvement of mature age people in the workforce and other productive work.^[296]

215. However, in doing so, whether through examining mechanisms for greater flexibility or strengthening statutory protections, there is a need to strike an appropriate balance between flexibility for employees and employers on the one hand—recognising that what flexibility means to each may be different—and statutory protections as well as minimum terms and conditions on the other. It is also important to ensure measures do not have unforeseen consequences, including for example, that protections and measures aimed at assisting mature age employees do not in turn make them unattractive to employers by imposing unreasonable additional regulatory requirements or costs.

216. This section examines barriers in employment law to mature age persons participating in the workforce or other productive work. It considers barriers at various stages of employment, from the recruitment and job search process to post-termination of employment remedies. Specifically, it identifies a number of potential barriers and ways in which these may be addressed including in relation to:

• entering and re-entering the workforce—the recruitment practices and administration of private recruiters;
• maintaining employment—amendment of the Fair Work Act 2009 (Cth) and instruments made under that Act;
• occupational health and safety; and
• employment management practices.

217. The ALRC acknowledges that there are a range of processes and inquiries currently being undertaken in the areas of anti-discrimination and employment law, the outcomes of which will be taken into account in this Inquiry.^[297]

Entering and re-entering the workforce

218. Mature age jobseekers face multiple and intersecting difficulties in entering or re-entering paid employment and often utilise either the national employment services system or the services of private recruitment agencies. The operation of national employment services is discussed earlier in this Issues Paper.

219. Increasingly, however, private recruitment agencies are playing a role as ‘intermediaries between job seekers and employers’.^[298] A number of significant reports have highlighted that some recruitment agencies are ‘reluctant to accept older workers as clients or recommend them to employers’.^[299] Indeed, unlawful age discrimination in recruitment has been described as ‘rampant, systemic and the area of employment decision-making where managers use age to differentiate between people most extensively’.^[300]

220. While private recruitment agencies operate under contractual arrangements with individual employers, there are a number of approaches to addressing recruitment practices that disadvantage mature age employees. The Hon Susan Ryan AO, Age Discrimination Commissioner, has indicated her concerns in this area and is already involved in discussions with the recruitment industry to ‘discuss how businesses do and could take constructive, supportive approaches to hiring’ mature age employees.^[301]

221. In addition, agencies are required to comply with relevant statutory obligations, including in relation to age discrimination. Where recruitment agencies discriminate against mature age employees, whether through their own practices or by following discriminatory employer preferences or requests, such agencies may face potential liability under anti-discrimination law.^[302]

222. A minimum regulatory approach—providing for regulation of private recruitment agencies by way of standards, codes of conduct or guidelines—may be another way to address these concerns. For example, such material may include information about appropriate engagement with mature age jobseekers. A number of useful models that could be adapted already exist. For example, members of the Recruitment and Consulting Services Association are required to comply with a code for professional conduct; and Australian Human Resources Institute members are required to comply with a code of ethics and professional conduct. The ALRC is interested in stakeholder feedback on these and any other approaches to the regulation of private recruitment practices which disadvantage mature age employees.

Maintaining employment

223. The Fair Work Act is one of the key Commonwealth legislative instruments that, through regulating employment and workplace relations, provides a framework within which mature age employees may choose to remain in paid employment.^[303] It provides for terms and conditions of employment and sets out the rights and responsibilities of employees, employers and employee organisations in relation to that employment. The Act also creates a compliance and enforcement regime and establishes several bodies to administer the Act, including Fair Work Australia (FWA) and the Office of the Fair Work Ombudsman (FWO).^[304]

224. In December 2011, the Australian Government announced details of a review of the Fair Work Act (the Review),^[305] to examine and report on the extent to which the legislation is operating as intended and areas where the operation of the legislation could be improved consistent with the objects of the Act. The Review is due to be completed by 31 May 2012.

225. While recognising that any recommendations for change to the Fair Work Act arising from the Review may affect issues considered in the course of this Inquiry, the ALRC considers that the Fair Work Act, oragreements and instruments made under the Act, may be potential areas for amendment, including:

• amending the National Employment Standards to provide an entitlement to flexible working arrangements on the basis of age;
• greater flexibility under the award system; and
• utilising flexibility clauses in enterprise agreements.

226. In addition to comments on these possible reforms, the ALRC is also interested in hearing about the effectiveness of the general protections provisions and other possible avenues for reform under the Fair Work Act.

Flexible working arrangements

227. The Consultative Forum on Mature Age Participation has emphasised that the ‘ability to work part-time or flexible hours has been found to be the most important facilitator, after good health, for older people to work beyond retirement age’.^[306] Examining legislative mechanisms for ensuring access to flexible working arrangements is vital to encouraging mature age employees to enter, re-enter or remain in the workforce. The Advisory Panel on the Economic Potential of Senior Australians commented that mature age persons have

diverse requirements for flexibility: some want part-time work; some want casual work; and some want to work for blocks of time, take leave and return to work … Others wish to scale-down and work fewer hours, allowing more time for recreation. Many find it difficult to work full-time, standard hours because of their health, caring responsibilities or other specific circumstances.^[307]

228. The two key legal, as opposed to policy-based, mechanisms which currently provide access to flexible working arrangements are the right to request flexible working arrangement provisions under the National Employment Standards (NES), and enterprise agreements.

National Employment Standards

229. The NES enshrine 10 statutory minimum requirements that apply to all ‘national system’ employees.^[308] The NES encompass areas such as working hours and arrangements, leave, and termination and redundancy pay. The NES are an absolute legislative safety net and cannot be excluded by an enterprise agreement or modern award.^[309] Any amendments to the NES would therefore have a wide-ranging impact on the entitlements of mature age employees.

230. Under the NES, an employee who satisfies the service requirements,^[310] who is a parent or otherwise has responsibility for a child who is under school age, or who is under 18 and has a disability, may request that his or her employer change his or her working arrangements to assist with the care of that child.^[311] Such a request may only be refused on ‘reasonable business grounds’.^[312]

231. A number of issues arise in relation to this provision. In particular, the provision is procedural rather than substantive. It provides that an employee is entitled to request flexible working arrangements, receive a response and, if that request is refused, be provided with a written statement of reasons.^[313] In addition, there are limited enforcement mechanisms available.^[314]

232. While in its current formulation the right to request flexible working arrangements is based on parental or child-care related responsibilities, potentially the section could be extended to include other bases upon which an employee could request these arrangements. For example, the Australian Government has indicated its intention to consider expanding the right to those with caring responsibilities more generally.^[315]

233. The Advisory Panel on the Economic Potential of Senior Australians recommended that the right be extended to people aged 55 and over.^[316] In addition, in February 2012, Adam Bandt MP introduced the Fair Work Amendment (Better Work/Life Balance) Bill 2012, which would, among other things, amend the Fair Work Act by extending the right to request to all employees and remove the flexible working arrangements provisions from the NES and create a new Part of the Act.^[317]

234. Despite some support for such an expansion, peak industry bodies such as the Australian Chamber of Commerce and Industry have expressed strong opposition to the extension of the right to request flexible working arrangements provisions.^[318]

Enterprise agreements

235. The Fair Work Act provides that there are several types of agreements, referred to as enterprise agreements, that can prevail over contracts of employment.^[319] Enterprise agreements govern the terms and conditions of employment and can be made between one or more employers and either their employees, or one or more employee organisations.

236. Section 202 of the Fair Work Act requires that every enterprise agreement must include a ‘flexibility term’, allowing the employer and the employee to make a specific ‘individual flexibility arrangement’ (IFA) that would vary the effect of the enterprise agreement to account for the employee’s particular circumstances.^[320] Therefore, under every enterprise agreement a mature age employee is entitled to negotiate an IFA with the employer, for example, to vary work arrangements.

237. Concerns have been raised that some mature age employees may not be in a position, or feel able, to negotiate an effective or useful IFA.

General protections provisions

238. Under the Fair Work Act, national system employees are entitled to a range of general workplace protections.^[321] These general protections, among other things, prohibit an employer from taking ‘adverse action’ against an employee or prospective employee on the basis of the employee having, exercising or not exercising, or proposing to exercise or not exercise, a ‘workplace right’, or to prevent the exercise of a ‘workplace right’.^[322] Measures that may constitute ‘adverse action’ taken by an employer against an employee include dismissal, injury or discrimination, or, in the case of a prospective employee, refusing to employ or discriminating in the terms or conditions of offer,^[323] and threatening any of the above.^[324]

239. The Fair Work Act prohibits specific forms of ‘adverse action’ being taken for discriminatory reasons and outlines a number of grounds of discrimination.^[325] Age is specifically listed at a protected attribute upon which a mature age employee may be able to pursue a claim of discrimination under the general protections provisions.^[326]

240. There are a range of issues with the current provisions. For example, the ALRC is aware of differing views as to the interpretation of the exclusion of actions that are ‘not unlawful under any anti-discrimination law in force in the place where the action is taken’.^[327]

241. Some commentators have suggested, however, that the general protections provisions may provide a more useful avenue for redress in circumstances of age discrimination in the employment context than state or federal anti-discrimination legislation. In particular, Therese MacDermott argues that the general protections regime encompasses a number of important aspects that can better be ‘used to the advantage of individuals pursuing age discrimination complaints’, including: the reverse onus of proof; the enforcement powers of the FWO; the cost implications of using the jurisdiction; and the availability of injunctive relief.^[328] In addition, as the regime is available to employees and prospective employees, it may also provide a useful mechanism for mature age people to combat discrimination in recruitment.

242. The general protections provisions provide statutory protection for mature age employees and may therefore act as an incentive for mature age workers to remain in the workforce.

Other reform possibilities

Modern awards

243. A modern award is an industrial instrument that regulates the minimum terms and conditions for a particular industry or occupation in addition to the statutory minimum outlined by the NES.^[329] A modern award cannot exclude any provisions of the NES but can provide additional detail in relation to the operation of an NES entitlement. Under the Fair Work Act, a national system employee who is not covered by an enterprise agreement^[330] and is not a ‘high income employee’^[331] may be covered by a modern award.^[332] 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.

244. As is the case with enterprise agreements, modern awards must include a ‘flexibility term’, allowing the employer and the employee to make a specific IFA to vary the effect of the enterprise agreement to account for the employee’s particular circumstances.^[333] Mature age employees are therefore entitled to negotiate IFAs with their employer under modern awards, for example, to vary their work arrangements.

245. Beginning in 2012, there will be several reviews of modern awards.^[334] The most important of these reviews will commence as soon as practicable after 1 January 2014.^[335] The reviews are ‘the principal way in which a modern award is maintained as a fair and relevant safety net of terms and conditions’.^[336] The ALRC suggests that the 2014 review may provide an opportunity to consider the effect of the award system on mature age employees. In the meantime, the ALRC is interested in stakeholder feedback about how the operation of modern awards affects mature age employees.

Compulsory retirement provisions

246. While compulsory retirement has been abolished for Commonwealth statutory office holders and other public servants, a number of direct and indirect mandatory retirement practices remain. For example:

• Under s 72 of the Australian Constitution, the maximum age for Justices of the High Court and any court created by Parliament is 70 years.^[337] While the section provides that Parliament may make a law fixing a lower age, it does not make such provision for a higher age.^[338]
• The compulsory retirement age for Australian Defence Force personnel is 60 years (65 years for reservists). However, there is provision for the Minister or the Chief to extend the compulsory retirement age for either a specific officer or member or a class of officers or members.

247. In addition, while not having a specific compulsory retirement age, a range of other occupations require re-licensing and qualification.

Occupational health and safety

248. Mature age workers may face barriers to employment that are related to occupational health and safety (OHS). However, ‘as everyone ages differently, we cannot generalise about older workers and assume they will have certain characteristics’ that translate into potential OHS risks.^[339] It may be necessary, therefore, to adjust workplace processes and practices to account for the needs of mature age workers. This may be particularly so in certain industries or types of work. The Consultative Forum on Mature Age Participation has emphasised that:

improving the quality of the working environment not only attracts mature age people into the workforce, but also it can increase longevity in employment. The creation of roles and work practices specific to mature age workers, such as the creation of more ergonomic working conditions, has been suggested as a means to recruit and retain such employees.^[340]

249. The ALRC is interested in stakeholder comment on mature age workers and OHS generally and in particular, on whether there is scope for recognition of the connection in strategic plans under the Australian Work Health and Safety Strategy 2012–2022 and OHS guidance material.

Legislative framework

250. On 1 January 2012, mirror OHS legislation was introduced in several Australian jurisdictions, including the Work Health and Safety Act 2011 (Cth) (WHS Act),^[341] based on model legislation, regulations and codes of practice released by Safe Work Australia—the statutory agency tasked with improving OHS and workers’ compensation arrangements in Australia.^[342] These reforms have been described as ‘the most significant reform’ to OHS laws in Australia in the last 30 years.^[343]

251. The WHS Act provides for a primary duty of care under which a person conducting a business or undertaking (PCBU) must ensure, so far as is reasonably practicable: the health and safety of workers while they are at work; the health and safety of others is not put at risk from work carried out; the provision and maintenance of a safe work environment; and a range of other requirements.^[344] Workers also have a primary duty to take reasonable care for their own safety at work, that their own acts or omissions do not adversely affect the health and safety of others and to cooperate with reasonable policies and instructions from the employer.^[345]

Strategic plans

252. At a national level, Safe Work Australia is currently seeking comment on a draft Australian Work Health and Safety Strategy 2012–2022 (WHS Strategy). Issues arising in relation to older workers and OHS issues are likely to be particularly relevant in the context of the ‘Healthy and Safe by Design’ action area.^[346] The two strategic outcomes under this action area are that: structures, plant, equipment and substances are designed to eliminate or minimise hazards or risks before they are introduced into the workplace; and work and work processes and systems of work are designed and managed to eliminate or minimise hazards or risks.^[347]

253. In addition to community consultation and comment on the draft, the Australian Government and all state and territory governments, as well as peak employer and employee representative groups, will develop strategic plans that are consistent with the WHS Strategy to ‘support the improved work health and safety of their constituents’.^[348]

Guidance material

254. In addition to OHS legislation, there is a range of guidance provided to duty holders about OHS matters in the form of regulations, Codes of Practice and other material produced by Safe Work Australia, Comcare and similar bodies.^[349] The inclusion of information on mature age workers and OHS issues could be included in guidance material, but could potentially also be included in Codes of Practice.

255. By way of example, at a state level, WorkSafe WA developed the bulletin, ‘Understanding the Safety and Health Needs of Your Workplace: Older Workers and Safety’, to raise awareness in relation to OHS issues relevant to older workers and provide guidance on risk assessment and adapting work practices according to the needs of mature age workers.^[350]

256. The ALRC is interested in stakeholder views on the necessity and appropriateness of including information on mature age workers and OHS issues in Codes of Practice or other guidance material.

Volunteers

257. The WHS Act expands the class of persons to whom a duty is owed to ‘workers’, rather than employees. Workers include employees, subcontractors, outworkers, apprentices, students and volunteers.^[351] As a result, the WHS Act applies to a range of volunteering organisations, but only those with paid staff. Safe Work Australia has developed a Volunteer Assistance Package and Assistance Line in order to assist volunteer organisations to understand and comply with the requirements under the Act.

258. Recognising that 32.5% of volunteers are aged 55 and over,^[352] the ALRC welcomes stakeholder comment on the effect of the recent OHS changes on mature age volunteers.

Approaches to regulation and monitoring

259. In order to encourage employers to consider strategies and creative employment management practices with respect to mature age employees, there are a range of potentially useful models involving regulation and monitoring, including for example:

• equity employment plans as required under statute in some international jurisdictions which document objectives, strategies, measurables and responsibilities; and
• a reporting framework similar to the one currently administered by the Equal Opportunity for Women in the Workplace Agency, which would require employers to report against equality indicators related to age.^[353]

260. The ALRC understands that there may be unintended consequences of such regulation, particularly with respect to employer views and stereotyping and welcomes stakeholder comment on these measures. More generally, the ALRC is interested in comment on measures that encourage employer responsiveness to the needs of mature age employees and provide support and assistance to them where necessary.

Education and awareness

261. In addition to the legislative, regulatory and practice-based approaches outlined above, there may also be a need for increased awareness and effective education around barriers to workforce participation for mature age people and appropriate responses.

262. From an employer perspective, there are a range of employment management practices that may contribute to removing barriers to mature age employees entering, re-entering and remaining in the workforce. These primarily include policies, procedures, awareness-raising measures, education and training.

263. A key example of such measures is the Australian Chamber of Commerce and Industry publication and campaign, Employ Outside the Box.^[354] General educative material, such as that released by FWO, also plays an important role in educating employees and employers about their rights and responsibilities.

264. The ALRC welcomes stakeholder comment on examples of best practice employment management practices in this area, the most appropriate approaches to raising awareness and on providing education and training in order to remove barriers to mature age persons participating in the workforce and other productive work.