WIN In-House Counsel Day Sydney

Tuesday 22 March 2016

HR COMPLIANCE LESSONS FROM 2015 AND WHAT TO EXPECT IN 2016 BRETT FELTHAM Outline

1. contracts and implied terms 2. Adverse action claims 3. claims 4. claims 5. Workplace investigations 6. Redundancies and restructuring 7. Work health and safety 8. 2015 legislative changes 9. Productivity Commission into Australia's workplace relations framework 10. Royal Commission into Trade Union Governance and Corruption

WIN In-House Counsel Day, 2016 22 March 2016 1 Employment contracts and implied terms Implied terms –– Commonwealth Bank of Australia v Barker [2014] HCA 32

. The High Court was asked to determine whether the CBA's failure to follow its redeployment policy constituted a breach of an implied term of mutual trust and confidence in the . That term was argued to require an employer to not, without reasonable cause, "conduct itself in a manner likely to destroy or seriously damage the relationship of confidence and trust between employer and employee" . In a unanimous decision, the High Court rejected the existence of that implied term . But this is not the end of the story for implied terms in an employment context …

WIN In-House Counsel Day, 2016 22 March 2016 3 Incorporation of policies – James v Royal Bank of Scotland [2015] NSWSC 243

Facts . The CEO of ABN AMRO was made redundant as a result of his employer being taken over by an international consortium . ABN AMRO had a "closed" redundancy policy, which provided for four weeks' severance pay per year of service plus a discretionary "golden handshake" based on the employee's average bonuses over the previous two years . The CEO argued that the redundancy policy formed part of the terms and conditions of his employment, on the basis that his employment contract stated: "You agree to be bound by the policies of ABN AMRO as may exist from time to time." . ABN AMRO declined to pay the CEO after he refused to sign a broadly-framed Deed of Release

WIN In-House Counsel Day, 2016 22 March 2016 4 Incorporation of policies – James v Royal Bank of Scotland [2015] NSWSC 243

NSW Supreme Court . The policy was expressly incorporated into the CEO’s employment contract, as the wording of the contract was "the language of contract" and created obligations which were "not merely unilateral" and equally bound the employer . Notwithstanding that the policy was not made accessible to employees, it did not make sense to suggest that the redundancy policy was binding on the CEO but not the employer in the absence of any express contractual provision to that effect . The CEO was awarded almost $3 million in damages

WIN In-House Counsel Day, 2016 22 March 2016 5 Lessons – Implied terms

. Employers need to ensure that their employment contracts do not inadvertently incorporate the terms of policies . Consideration should be given to not providing a prescriptive basis or formulae for calculations in a policy, to minimise an employer's potential exposure to breach of contract claims where they determine to calculate payments on a different basis . Extra tip – It is good practice to regularly review contracts to ensure that they remain "fit for purpose" in general terms, are still relevant to the employee's now role and responsibilities, and properly protect the employer's business in relation to its confidential information and the potential post-termination activities of an employee

WIN In-House Counsel Day, 2016 22 March 2016 6 Adverse action claims More and more adverse action claims …

. The Fair Work Commission is receiving more adverse action (general protections) claims each year . In its recent annual report, the Fair Work Commission reported receiving 3,382 adverse action claims involving a dismissal in 2014 - 2015, up from 2,879 in the previous year . Anecdotally there has been an increase in the number of adverse action claims commenced where an employee alleges that they have been terminated because they raised an inquiry or complaint in relation to their employment

WIN In-House Counsel Day, 2016 22 March 2016 8 Making a complaint or inquiry

. Under the general protections provisions in the Fair Work Act, a person will exercise a workplace right if they make a "complaint or inquiry": . to a person or body who can deal with the complaint or inquiry under a workplace law, or . in relation to his or her employment . Where an employee has made a complaint or inquiry in relation to their employment prior to termination, they will commonly allege that the termination was motivated by the complaint or inquiry in breach of these provisions

WIN In-House Counsel Day, 2016 22 March 2016 9 Making a complaint or inquiry cont.

. This broad wording means that almost any complaint or inquiry an employee has made will provide some potential basis to bring a claim . The complaint or inquiry can arise in relation to matters that are not contractual, regulatory or statutory – it could be an employee questioning their entitlements, allegations of workplace bullying, or raising broader concerns about conduct that has implications for their employment . These claims are commonly used by employees to challenge their termination in circumstances where they cannot bring an unfair dismissal claim, for example: . where they have been terminated prior to completing the necessary minimum employment period, or . because they earn more than the high income threshold

WIN In-House Counsel Day, 2016 22 March 2016 10 Lessons – What can an employer do to defend (and limit the risk of) a claim?

. Always ensure that any complaints or inquiries are properly addressed in accordance with any workplace policy . When a decision is made, always be clear about the lawful reason for the decision – the stronger the lawful reason for the decision, the better the employer's defence . Ensure that any internal documentation (including emails and summaries of meetings) clearly sets out the reason for the adverse action . Communicate the lawful basis for the termination to the employee in writing, even if the individual is not covered by unfair dismissal laws . Extra tip – Damages are uncapped and can also be awarded against HR managers and others

WIN In-House Counsel Day, 2016 22 March 2016 11 Workplace bullying claims Workplace bullying

. When the anti-bullying provisions commenced 1 January 2014, the Fair Work Commission expected that there would be a flood of complaints lodged – that flood was really more like a trickle … . A worker will be "bullied at work" if an individual (or a group of individuals) repeatedly behaves unreasonably towards that worker and that behaviour creates a risk to health and safety . In its most recent annual report, the Fair Work Commission has stated that during the 2014 – 2015 period it: . received more than 150,000 unique website hits regarding anti-bullying . dealt with more than 6,300 telephone inquiries, and . processed 694 applications

WIN In-House Counsel Day, 2016 22 March 2016 13 Workplace bullying cont.

. Of those applications, the overwhelming majority were withdrawn at an early or after a conference between the parties and very few stop bullying orders have been made by the Fair Work Commission . Despite those statistics, anecdotally the number of employees prepared to at least make an internal complaint of workplace bullying is increasing rapidly … . The risks of an employee commencing a claim, including for example an adverse action claim where a complaint of workplace bullying has been made but not been properly resolved, means that employers need to deal with workplace bullying complaints effectively

WIN In-House Counsel Day, 2016 22 March 2016 14 Workplace bullying – Roberts v VIEW Launceston P/L and Ors [2015] FWC 6556

Facts . Ms R commenced working for View in November 2012 as a Property Consultant . Ms R alleged that View, Mr Bird as the principal and a co- director of View, and Mrs Bird who worked as a Sales Administrator, engaged in bullying behaviour and applied to the Fair Work Commission for a stop bullying order . Ms R successfully made out eight of her 18 allegations against the company and the Sales Administrator and demonstrated links to her medical diagnosis of depression and anxiety

WIN In-House Counsel Day, 2016 22 March 2016 15 Workplace bullying – Roberts v VIEW Launceston P/L and Ors [2015] FWC 6556

Facts cont. . One of the allegations made against the Sales Administrator was that the day after Ms R called the co-director at home and asked why none of her properties were displayed in View's window, the Sales Administrator called Ms R into a meeting, likened her to a dobbing schoolgirl, and blocked the door when she tried to leave . The Fair Work Commission stated that the Sales Administrator had dealt with Ms R in a "provocative and disobliging" way and that by deleting her as a Facebook friend immediately after that incident she had taken "the first opportunity to draw the line under the relationship"

WIN In-House Counsel Day, 2016 22 March 2016 16 Workplace bullying – Roberts v VIEW Launceston P/L and Ors [2015] FWC 6556

Fair Work Commission . The Sales Administrator's actions constituted bullying, which included deliberately delaying administrative work for Ms R's listings, ignoring her, treating her differently to other staff members, and failing to greet her each morning . Rejected View's position that there was no further risk of bullying behaviour because View had now established an anti-bullying policy and manual . The evidence during the hearing showed that View (through the co-director and the Sales Administrator) did not consider that their behaviour constituted bullying . The matter was listed for a conference between the parties to discuss the appropriate stop bullying orders

WIN In-House Counsel Day, 2016 22 March 2016 17 Workplace bullying – Sharon Bowker & Ors v DP World Limited [2015] PR574247

Facts . Three DPW employees applied for stop bullying orders alleging that they were being bullied by other DPW employees, MUA members and/or MUA officials . In 2013 two of the employees alleged that a driver had made false comments about one of those female employees being in a relationship with a . From that time, those two employees, plus a foreman who had acted as a support person, alleged that they were bullied including through insulting Facebook post and telephone calls . The employees commenced on "special " in late 2014 and raised more than 200 complaints and concerns with the Fair Work Commission

WIN In-House Counsel Day, 2016 22 March 2016 18 Workplace bullying – Sharon Bowker & Ors v DP World Limited [2015] PR574247

Fair Work Commission . Did not accept DPW's argument that the employees would not face future risks to their health and safety when they returned to work because it had improved workplace bullying policies and CCTV coverage, and introduced training programs and independent mediation services . Considered it unlikely that those steps would eradicate the code of silence that operated at the workplace . Fair Work Commission made eight stop bullying orders against DPW including arranging for a WorkSafe Victoria inspector to meet with each employee and DPW to finalise risk assessments and return to work plans, and specific training on forensic investigative techniques for managers likely to investigate bullying complaints

WIN In-House Counsel Day, 2016 22 March 2016 19 Lessons – Workplace bullying

. While the number of complaints in the anti-bullying jurisdiction remains relatively low, workplace bullying is a growing workplace issue . If there is no acceptance that conduct constitutes workplace bullying, then there must be a greater risk of reoccurrence . Cultural change is a key element – the introduction of policies and training will not be enough . Workplace bullying is best dealt with by taking steps to prevent it long before it becomes a risk and long before a worker contemplates applying to the Fair Work Commission . Follow a risk management process which involves identifying bullying risk factors, assessing the likelihood of bullying occurring, and eliminating or minimising those risks

WIN In-House Counsel Day, 2016 22 March 2016 20 Sexual harassment claims Sexual harassment – Richardson v Oracle Corporation Australia P/L [2014] FCAFC 82

. Damages awards for sexual harassment and discrimination claims are on the rise . The Full Federal Court held that while the accepted range of damages in sexual discrimination cases had been generally between $12,000 and $20,000 up until that time, community standards now demanded higher compensation for non- economic loss . As a result, the Full Federal Court increased the damages awarded to Ms R from $18,000 to $130,000 (including $100,000 for non-economic loss)

WIN In-House Counsel Day, 2016 22 March 2016 22 Sexual harassment – Collins v Smith [2015] VCAT 1992

Facts . Ms C worked in a licensed post office branch . Ms C alleged that over a 3 month period the owner/manager attempted to kiss her, touched her inappropriately, sent incessant text messages and left messages for her making sexual advances, and demanded sexual favours in return for allowing her to work Saturday shifts . Manager alleged that Ms C had enjoyed and encouraged those advances and/or should have protested more vigorously . Ms C resigned from her employment

WIN In-House Counsel Day, 2016 22 March 2016 23 Sexual harassment – Collins v Smith [2015] VCAT 1992

VCAT . While Richardson v Oracle Corporation was decided under Federal legislation, the same analysis and considerations should apply under Victorian discrimination legislation . VCAT awarded Ms C: . $180,000 in general damages . $20,000 in aggravated damages – the prolonged period of harassment, happened in a confined office environment, and continued despite Ms C's obvious increasing distress . $120,000 for past and future loss of earnings and super, and . $12,280 for out-of-pocket expenses

WIN In-House Counsel Day, 2016 22 March 2016 24 Lessons – Sexual harassment

. Those decisions point to an increased emphasis by courts on the experience of pain and suffering by victims of sexual harassment and the deprivation of the enjoyment of life as a result . Employers need to take into account this shift in approach when assessing potential liability in sexual discrimination and harassment cases . Given the potential for higher damages awards, employers must ensure that they have clear policies in place as to what is appropriate conduct in the workplace and that their employees receive regular training on these issues

WIN In-House Counsel Day, 2016 22 March 2016 25 Workplace investigations Why conduct an investigation?

. A wide range of issues may require investigation by an employer from inappropriate behaviour or conduct in the workplace, through to workplace accidents, and performance issues . An employee complaint can be made formally or informally, verbally or in writing, or complaints can come to employer's attention through other employees, rumours, or exit interviews . Employers may be left facing adverse consequences as a result of a failure to properly investigate a workplace complaint or incident, even where a complainant does not request it . A properly conducted investigation can help employers to successfully defend a claim by an employee or a prosecution – increasingly HR managers are spending a greater proportion of their time conducting investigations

WIN In-House Counsel Day, 2016 22 March 2016 27 Investigation 101

. An investigation should be commenced as soon as possible and be conducted in line with any organisational policies and procedures . A person needs to be appointed to be the investigator – consideration should be given as to whether the investigator should be internal or external and independence issues . Where internal, the employer should separate the roles of the person conducting the investigation, and the person who will implement any recommendations or actions arising from the findings of the investigation

WIN In-House Counsel Day, 2016 22 March 2016 28 Investigation 101 cont.

. Ensure the complainant, the alleged wrongdoer and anyone else interviewed as part of the investigation, all are treated procedurally fairly . Interviews with each interviewee should be conducted separately to maintain confidentiality, and to encourage an open discussion between the investigator and each interviewee . Offer the complainant, the alleged wrongdoer, and in some cases, each witness being interviewed, the opportunity to bring a support person to their interview with the investigator . Be aware of language difficulties and consider whether the services of an interpreter are needed

WIN In-House Counsel Day, 2016 22 March 2016 29 Role of the investigator

. The allegations must be made clear to the alleged wrongdoer and they should be given the opportunity to provide a meaningful response to the allegations made against them . The investigator must determine whether the alleged events occurred and whether there is there a sufficient amount of evidence to find the allegations proven? . The investigator must often compare competing versions of events to determine which is more probable . The investigator should provide a comprehensive written report of the investigation process, findings reached (including reasons/evidence for the findings) and the recommended course of action to be taken (if requested)

WIN In-House Counsel Day, 2016 22 March 2016 30 Kaibel v CKI People Pty Ltd [2015] FWC 4220

Facts . CKI is a people development and change consultancy . Ms K was dismissed from her position as a Senior HR Consultant when it was discovered that she had downloaded confidential business information and transferred it to an external hard drive . Ms K claimed that she had downloaded the information to enable her to work on projects from home over Christmas . CKI remotely checked her system, revealing she had downloaded confidential material on two other occasions, including in the previous September

WIN In-House Counsel Day, 2016 22 March 2016 31 Kaibel v CKI People Pty Ltd [2015] FWC 4220

Facts cont. . CKI considered that her actions were unauthorised and accused her of serious misconduct and breaches of company policy, alleging she was stealing information and company records . CKI claimed Ms K had attempted to hide the file transfer process by placing the hard drive out of sight, and had done so because it suspected she wanted to use the information to start her own business

WIN In-House Counsel Day, 2016 22 March 2016 32 Kaibel v CKI People Pty Ltd [2015] FWC 4220

Fair Work Commission . Accepted that the combination of events and circumstances were grounds for suspicion, but he was not satisfied that Ms K had the motive or intent to misappropriate the company's IP . CKI's belief that Ms K had "stolen" company IP with the intent of misusing it was speculative and, at the time of the termination, there was insufficient foundation for such a belief to be reasonably held . While CKI had a valid reason to dismiss Ms K, her misconduct was not serious enough to justify immediate dismissal, and CKI had failed to follow a proper investigation process . CKI was ordered to pay Ms K $11,505 compensation plus super

WIN In-House Counsel Day, 2016 22 March 2016 33 Redundancies and restructuring Use of contractors and workers – Troy Brown v Clermont Coal P/L [2015] FWC 3862

Facts . In 2014 CC undertook a restructure involving more than 100 losses, being a combination of compulsory and voluntary redundancies and the removal of contractors and labour hire workers . Six dismissed employees commenced unfair dismissal claims . CC alleged that the terminations were genuine redundancies and the employees could not sustain unfair dismissal claims . The employees argued that their terminations were not genuine redundancies, as they could have been reasonably redeployed into roles performed by contractors or labour hire workers either within CC's operations or those of an associated entity

WIN In-House Counsel Day, 2016 22 March 2016 35 Use of contractors and labour hire workers – Troy Brown v Clermont Coal P/L [2015] FWC 3862

Facts cont. . CC's business model involved: . it generally having a mix of employees and contractors performing work . the roles of the contractors changing depending on operational requirements and as a result they provided operational flexibility, and . in some cases contractors performing specialised work . The associated entity's business model used a large number of labour hire workers, being a deliberate decision not to employ additional employees until a new enterprise agreement had been finalised

WIN In-House Counsel Day, 2016 22 March 2016 36 Use of contractors and labour hire workers – Troy Brown v Clermont Coal P/L [2015] FWC 3862

Fair Work Commission . The terminations were genuine redundancies . It was not reasonable for the employees to be redeployed into roles performed by contractors or labour hire workers at CC or its associated entity . CC's business model was legitimate and was maintained for a variety of operational reasons – it was not for the Fair Work Commission to criticise a legitimate business model . It was not reasonable for the associated entity to create new positions, remove contractors or to change its own business model – it was not for the Fair Work Commission to question their legitimate industrial strategy, particularly where it was unrelated to the CC redundancies

WIN In-House Counsel Day, 2016 22 March 2016 37 Lessons – Redundancies and restructuring

. Where an employee brings an unfair dismissal claim, then in order to rely upon the "genuine redundancy" exemption, the employer must consider all reasonable redeployment opportunities in its business and that of its associated entities and meet any consultation obligations . Where a company uses contractors and labour hire workers under a commercially justifiable business model, redeployment does not require that those workers be displaced . Extra tip – In circumstances where an employer wants to seek to reduce or avoid making redundancy payments because employees have obtained acceptable alternative employment, then the employer needs to be actively involved in that process

WIN In-House Counsel Day, 2016 22 March 2016 38 Work health and safety Changes?

. There has been no further movement on work health and safety harmonisation – 7 out of 9 jurisdictions have enacted legislation that is substantially based on the model WHS legislation developed by Safe Work Australia . The hold out states remain Victoria and Western Australia . Prosecutions under the harmonised WHS legislation have started to be finalised . Fines for breaches are increasing, which is to be expected due to the higher maximum fines under that legislation … . A fine of $1.1M was awarded against an employer operating an unsafe workplace that resulted in a contractor being fatally electrocuted

WIN In-House Counsel Day, 2016 22 March 2016 40 2015 legislative changes The current status of legislative change

. The year 2015 was a relatively quiet year for legislative change when compared to recent years . The final reports of the Productivity Commission into Australia's workplace relations framework and the Royal Commission into Trade Union Governance and Corruption were released in December 2015 . The Federal Government is expected to seek to introduce various recommendations set out in those reports … and with a Federal election later this year, we can expect to see even further changes …

WIN In-House Counsel Day, 2016 22 March 2016 42 Fair Work Amendment Act 2015 (Cth)

. The Fair Work Amendment Act 2015 (Cth) came into effect on 27 November 2015 – three areas of change . Unpaid : . employees have the right to request an extension to their initial period of up to 12 months unpaid parental leave . employers must now provide their employees with a "reasonable opportunity" to discuss that extension prior to any refusal by the employer . employers still need to respond to those requests in writing within 21 days and on reasonable business grounds . those responses will need to take any matters discussed with the employee

WIN In-House Counsel Day, 2016 22 March 2016 43 Fair Work Amendment Act 2015 (Cth)

. Greenfields agreements: . designed to be made prior to employees being employed as part of a new enterprise . an employer must bargain with any relevant unions, but now an employer is able to put forward a draft agreement for approval by the Fair Work Commission, if the employer has been unable to reach agreement with the unions within 6 months . the Fair Work Commission must approve that draft agreement if employees will be better off overall when compared to a modern award which would apply and to any other relevant standards . these amendments are designed to limit the ability of unions to frustrate or delay the agreement making process

WIN In-House Counsel Day, 2016 22 March 2016 44 Fair Work Amendment Act 2015 (Cth)

. Protected ballot orders: . employees have the ability to strike or take other protected industrial action in support of claims for making new agreements . now any application for a protected action ballot order can only be made when bargaining has commenced, and the employer has either agreed to bargain or the majority of relevant employees vote to seek a new agreement

WIN In-House Counsel Day, 2016 22 March 2016 45 More changes to come?

. On 3 December 2015 the Federal Government introduced the Fair Work Amendment (Remaining 2014 Measures) Bill 2015 . This is designed to re-introduce those amendments removed from the amending legislation, including to clarify obligations to pay loading on termination and to tighten union rights of entry and transfer of business rules . But more legislative changes are likely as a result of two major reports released in December 2015 …

WIN In-House Counsel Day, 2016 22 March 2016 46 Productivity Commission into Australia's workplace relations framework Productivity Commission report

. The Productivity Commission handed down its final 1,229 page report on Australia's workplace relations framework, with the report being publicly released on 21 December 2015 . The general view is that Australia’s labour market performance and flexibility is relatively good by global standards – strike activity is low, are responsive to the economic cycle, and there are multiple forms of employment arrangements that offer employees and employers flexible options for working . Australia's workplace relations system is not seen as being broken, but is in need of repair … . The Federal Government has said it will engage in public consultation on the recommendations

WIN In-House Counsel Day, 2016 22 March 2016 48 Enterprise contracts?

. Scope for a new form of employment arrangement which would provide for variations to modern awards . An enterprise contract: . could be used to vary modern awards for nominated employees . would not vary the National Employment Standards or minimum . would not make any employee worse off compared with any relevant award, as the enterprise contract would be required to pass a no disadvantage test . could not be used to vary enterprise agreements, and . would be offered on a "take it or leave it" basis to new employees

WIN In-House Counsel Day, 2016 22 March 2016 49 Enterprise contracts? cont.

. Would not involve risks to employees as there would be a comprehensive set of protections, including: . a clear written statement to employees of the implications of award variations . a no disadvantage requirement . the right to revert to the award or to initiate enterprise bargaining, and . continued coverage by the National Employment Standards . Recognition by the Productivity Commission that some employers lack real options for agreement-making – enterprise agreement negotiations can be too daunting (particularly for small businesses), and individual flexibility arrangements or more often common law contracts can be ineffective

WIN In-House Counsel Day, 2016 22 March 2016 50 Penalty rates

Long hours and night work . Current restrictions on maximum hours worked and premium rates of pay for long hours or work at night are justified given the strong evidence of the impact on employees' health Selected consumer services . Penalty rates for weekend day work vary substantially across industries . Many employers are concerned about high penalty rates on Sundays in industries where weekend consumer demand is strong . Submissions point to a growing demand for consumer services over weekends (with some arguing that Sunday has become the new Saturday)

WIN In-House Counsel Day, 2016 22 March 2016 51 Penalty rates cont.

. It was also submitted that automation and online shopping are likely to dramatically affect the demand for weekend workers if their wage rates are too high . Penalty rates were introduced to act as a deterrent against asocial working times and to compensate employees for working at inconvenient times, but the economic environment and community attitudes that provided the original basis have changed . The Productivity Commission recommends that Sunday penalty rates for hospitality, entertainment, retailing, restaurants and cafes should be aligned with those on Saturday, creating one weekend rate (though this may vary across the respective industries)

WIN In-House Counsel Day, 2016 22 March 2016 52 Productivity Commission recommendations

Workplace institutions Minimum adult wage . Fair Work Commission . Australia’s is undertakes functions well, but high by international standards at times adopts a legalistic . Economic rationale for a approach regulated minimum wage that . Alter the appointment lifts the incomes of low paid processes for members of the workers above the levels they Fair Work Commission would otherwise receive . Independent Workplace . Large increases in the Standards Commission should minimum wage will reduce be set up to review and vary employment levels the national minimum wage and modern awards

WIN In-House Counsel Day, 2016 22 March 2016 53 Productivity Commission recommendations cont.

Modern awards Junior rates . They are an important safety . Lower minimum pay rates for net and a useful benchmark for juniors should be retained many employers given the risks to employment . Award system needs to be from raising wages "repaired" rather than replaced . There could be merit in . Workplace Standards restructuring age based junior Commission should review pay rates to give more awards on an ongoing basis emphasis to experience (rather than four yearly), and/or competency focussing on aspects of awards . Suggested separate review of that are the source of greatest and traineeship problems arrangements

WIN In-House Counsel Day, 2016 22 March 2016 54 Productivity Commission recommendations cont.

Industrial disputes Enterprise bargaining . Recommend simplifying . The Fair Work Commission processes for secret ballots to should have more discretion to authorise industrial action overlook minor procedural . Modify the threshold for the defects during bargaining Fair Work Commission to . Agreements should be limited intervene in some disputes in content to "employee – . Deter the use of aborted strikes employer" issues, and not and brief stoppages that include terms that pertain to impose costs on employers the relationship between an employer and a union . Employers should be given more options for retaliatory . Allow enterprise agreements industrial action other than with longer durations (up to 5 locking out their workforce years)

WIN In-House Counsel Day, 2016 22 March 2016 55 Productivity Commission recommendations cont.

Greenfields agreements Transfer of business . After a three month negotiation . Give the Fair Work Commission period, stalemates should be more discretion to order that an resolved by using "last offer" employment arrangement does arbitration, or an employer not transfer, where that could seek approval of a 12 improves the prospects of month agreement employees gaining employment . Project proponent agreements . Transferring agreements (made by a head contractor) should automatically terminate should be available to after 12 months, except subcontractors to use between associated entities . Agreements should be allowed . Voluntary movements between to match the period of the associated entities should be construction phase of a project exempt from provisions

WIN In-House Counsel Day, 2016 22 March 2016 56 Productivity Commission recommendations cont.

Unfair dismissal claims General protections (Adverse . Rejects calls for removing action) claims unfair dismissal laws entirely . Recommend that the right to . Remove the emphasis on make a "complaint or inquiry" reinstatement as the primary needs to be better defined goal . There needs to be better . Introduce a more effective active management by the upfront filter that focuses on Fair Work Commission of the merits to remove spurious document discovery claims processes . Amend to ensure that . Greater powers to award costs procedural errors alone are not against applicants in certain sufficient to award circumstances compensation or reinstatement

WIN In-House Counsel Day, 2016 22 March 2016 57 Royal Commission into Trade Union Governance and Corruption Final Report of the Royal Commission into Trade Union Governance and Corruption

. The Royal Commission's final report was released by the Federal Government on 30 December 2015 . Reported widespread misconduct by a number of unions, but considered that this was only the "tip of the iceberg" … . A number of issues seem to be consistent in the identified corrupt or illegal practices: . the failure of union management to deal with the conduct of particular officials . the creation of false records and invoices . the inflation of union membership numbers, and . the payment of large sums by employers to unions in the context of enterprise bargaining

WIN In-House Counsel Day, 2016 22 March 2016 59 Final Report of the Royal Commission into Trade Union Governance and Corruption cont.

. A number of unions, union officials, and employers have been referred to a police taskforce to further investigate criminal allegations and to a cross-agency working group to investigate potential civil law breaches . A number of recommendations have also been made to amend Australia's industrial and registered organisations laws . Federal Government has strongly supported all findings and we expect new legislation to be introduced to implement recommendations . If these recommendations are implemented then they are likely to materially affect the role of unions in any workplace, and can be expected to be strongly resisted by unions and their officials

WIN In-House Counsel Day, 2016 22 March 2016 60 Royal Commission recommendations

. The key law reform recommendations are: . creating a new Registered Organisations Commission with broad investigative and enforcement powers . maintaining an independent building and construction regulator – currently the Fair Work Building Industry Inspectorate . increasing penalties and imposing criminal liability on union officials who dishonestly or recklessly breach their duties . prohibiting a union from indemnifying or paying any penalty imposed on a union official . creating a criminal offence for an employer to pay or provide a benefit to a union or its officials other than in very limited circumstances

WIN In-House Counsel Day, 2016 22 March 2016 61 Royal Commission recommendations cont.

. reforming regulation of union matters such as financial management, mandatory training, and record keeping . right of entry permits only to be issued to fit and proper persons and prohibiting right of entry of two or more permit holders at the one time . expanding the definition of "picketing" and the ability of the building industry regulator and ACCC to investigate secondary boycott breaches . unions to disclose potential financial benefits from an enterprise agreement, and prohibit terms requirements for contributions to training or welfare funds . give all employees super choice by removing the prescription of superannuation funds in an enterprise agreement

WIN In-House Counsel Day, 2016 22 March 2016 62 Key takeaways

1. Beware incorporation of 6. Look for redeployment prescriptive policies opportunities where 2. Address complaints/inquiries redundancies occurring and be clear on reasons for 7. Work health and safety fines decisions are on the increase 3. Take a risk management 8. Minor legislative changes approach to workplace made in 2015 bullying 9. Significant recommendations 4. Damages for sexual made by Productivity harassment/discrimination Commission, so watch this claims are on the rise space! 5. Thorough and fair workplace 10.Beware industrial changes investigations are crucial due to Royal Commission recommendations

WIN In-House Counsel Day, 2016 22 March 2016 63