Changes to Fair Work Act - What does this mean for employers?


The Fair Work Amendment Act 2012 (Cth) (the Amendment Act), which largely commenced on 1 January 2013, implements a number of recommendations of the Fair Work Act Review Panel's (Panel) Report released on 15 June 2012.

The key changes to the Fair Work Act 2009 (Cth) are:

• changing the name of Fair Work Australia to the Fair Work Commission (FWC);
• increasing the time limit for employees to lodge an Unfair Dismissal claim with the FWC from 14 days to 21 days;
• reducing the time limit for employees to lodge a General Protections claim with the FWC from 60 days to 21 days;
• expanding the FWC's powers to make costs orders against parties to an application for Unfair Dismissal and their representatives and expanding the FWC's powers to dismiss an application based on unreasonable behaviour by parties;
• changing the way in which enterprise agreements are made;
• confirming that a union or a union official cannot be a bargaining representative of an employee unless the union is entitled to represent the industrial interests of the employee in relation to work that will be performed under the enterprise agreement.

Unfair Dismissal and General Protections

The Amendment Act has changed the time limit for employees who were dismissed on or after 1 January 2013 to lodge either an Unfair Dismissal claim or General Protections claim to 21 days.

Whilst the Amendment Act increases the time allowed for filing an Unfair Dismissal application, the reduction from 60 to 21 days to lodge a General Protections claim encourages employees to act promptly in seeking a remedy and will require them to lodge one claim or the other (not one followed by the other as is presently the case).

The FWC has discretionary power to make costs orders against employees who fail to discontinue an application, where the employer incurs costs as a result of the employee's unreasonable act or omission.  This will capture a broad range of conduct, including a failure to discontinue an Unfair Dismissal application and a failure to agree to terms of settlement that could have led to the application being discontinued.

As the power is discretionary, the "unreasonableness" of the employee's act or omission will depend upon the particular facts and circumstances in each Unfair Dismissal claim.  The FWC needs to be satisfied that the facts and circumstances are unreasonable before exercising its discretion to use this power.

The FWC has power to make orders against lawyers and paid agents, particularly where they encourage parties to lodge (or defend) claims that the lawyers or paid agents know have no reasonable prospects of success.  This will hopefully deter lawyers and paid agents from encouraging employees to pursue "speculative claims".

The FWC has expanded power to dismiss an application based on unreasonable behaviour by an employee, for example where an employee fails to comply with a directive or order to lodge a document with the FWC.

Enterprise Agreements and Protected Industrial Action

The Amendment Act makes it clear that an enterprise agreement cannot be made with a single employee and limits the capacity of a union official to be a bargaining agent in negotiations for an enterprise agreement.

The Amendment Act also prohibits the inclusion of "opt-out" clauses in enterprise agreements. Such clauses have been used by employers to reach agreement with individual employees whereby an otherwise applicable enterprise agreement will not cover them.  Such a term is now unlawful and an enterprise agreement cannot be approved by the FWC if it contains such a term.

Voting in a protected action ballot can now be conducted electronically, and the FWC can ensure that ballots are conducted as expeditiously as practicable.

What do Employers need to do?

Employers need to familiarise themselves with these changes and update their workplace practices and arrangements accordingly.  It is expected that further changes will be implemented in respect of some of the remaining recommendations from the Panel's Report including workplace bullying, parental leave and extending the availability for employees to request flexible workplace arrangements, with the Federal Government to finalise the details of any new provisions with stakeholders in coming weeks. However, it is unclear when any further legislation will be introduced, particularly with a Federal election due later this year.  HWL Ebsworth Lawyers will keep clients updated on any material developments.


This e'News was written with the assistance of Adina Teggins, Solicitor.

For information on our Workplace Relations and Safety Group click here.

Important disclaimer: The material contained in this publication is of a general nature only and is based on the law as at 22 February 2013. It is not, nor is it intended to be, legal advice. If you wish to take any action based on the content of this publication we recommend that you seek professional advice.