In the wake of the Labor Party’s victory in last weekend’s federal election, employers have just two months available to lodge Australian Workplace Agreements.
In the wake of the Labor Party’s victory in last weekend’s federal election, employers have just two months available to lodge Australian Workplace Agreements.
The new federal Labor government is expected to introduce a transition bill in its first sitting of parliament in February to begin its overhaul of the Howard government’s WorkChoices laws.
The transition bill, which will operate from early next year until December 31 2009, will constitute the first step in Labor’s plans to abolish AWAs in favour of collective agreements and common law contracts.
AWAs submitted before the transition bill is implemented will be valid for up to five years. After the transition bill comes into effect, individual transitional employment agreements will be available to employers already using AWAs, even for new employees, provided they expire by December 31 2009.
These agreements will have to meet additional criteria to ensure future movements in minimum wages are passed on.
University of Western Australia business school senior lecturer in industrial relations, Dr Trish Todd, said the transitional employment agreements were designed to replace AWAs in the interim and improve conditions for those employees, although the changes may create further confusion for employers.
“It seems to me they’re ensuring a better minimum standard. It’s really the old no-disadvantage test being played out,” she said.
“The fairness test seems to have caught a lot of employers out and this will become another challenge for employers to understand how to get their individual agreement recognised.”
Freehills partner Russell Allen said the benchmark for the new individual transitional agreements would be collective agreements or awards, rather than the fairness test that applied to AWAs.
“We are hopeful that the ALP will ensure (these) agreements are a viable alternative by ensuring there can be adequate flexibility in terms of work patterning and salary package arrangements,” he said.
Dr Todd said the new regulations would be most likely to impact businesses employing low income earners, such as those in the services industry.
“Those employers that have used AWAs to reduce their employment costs, particularly around penalty rates, will find the legislation requires them to take more account of provisions and awards,” she said.
Awards will only be available to employees earning less than $100,000 a year, while those earning above this threshold will have access to individual common law contracts.
On January 1 2010, a new list of 10 national employment standards will come into effect, covering areas including hours of work, parental leave, termination of employment and long-service leave.
These will extend the existing five minimum standards under WorkChoices.
The changes also include the establishment of a new regulatory body, Fair Work Australia, to replace the Workplace Authority and the Australian Industrial Relations Commission.
