National Tertiary Education Industry Union (NTEU)

National Tertiary Education Industry Union (NTEU)

(Grahame McCulloch, General Secretary)

Submission to the Fair Work Act Review Panel

February 2012

Contents

About the NTEU

A.General Comments

1.The Transition from WorkChoices

2.Fair Work Act Fails to Meet Australia’s International Obligations

B. Specific Issues which NTEU Wishes to Raise

1.Encouraging Secure Employment, Genuine Flexibility and Non-Discrimination Based on Type of Employment

2.Requirement to End All Industrial Action rather than that which Threatens or “Has Threatened” Health Safety etc

3.The Effect of the Compression of Relativities on the BOOT test

4.Section 386 and Drafting Error

5.Representation by Lawyers and Paid Agents

About the NTEU

The National Tertiary Education Industry Union (NTEU) represents over 25,000 staff employed in tertiary education in Australia. Tertiary education includes Higher Education, Vocational Education and Training (VET) and Further Education. Tertiary education covers a wide range of institutions that deliver post-secondary education, including universities, TAFEs and other education providers. The Union’s coverage also includes research centres and institutes that drive Australia’s national innovation, research and development effort.

The workers who make up our sector are diverse. They include academics across all disciplinary areas, world-renowned experts and public intellectuals, laboratory technicians and librarians, staff who work for student unions, as well as staff who work at student centres. The NTEU has exclusive coverage of academic staff, and complete coverage of general staff. From industry experts to electricians to postgraduate tutors, these workers fall within the NTEU’s coverage.

A.General Comments

1.The Transition from WorkChoices

With the exception of the removal of the right of Unions to be a party to an Agreement (Fair Work Act 2009 (the Act) s.172; Workplace Relations Act 1996 (WRA)s.328), there is no material way in which the Act is inferior to the previous “WorkChoices” legislation (2006-2009). Although not directly relevant to this Review, it should be noted that for higher education employees, the Higher Education Workplace Relations Requirements (HEWRRs) operated in conjunction with WorkChoices to deny higher education employees the right to free collective bargaining, and were the subject of a specific complaint to the ILO Committee of Experts.[1]

The Act represents a significant improvement as compared to the previous regime. Of most practical importance to the NTEU and its members have been:

• The removal of statutory individual agreements;
• The rights which attach to bargaining representatives;
• The removal of “prohibited matters” from enterprise agreements;
• Improvements in the procedures for settling disputes under enterprise agreements; and
• The replacement of a very patchy Award system for private providers of tertiary education with the comprehensive (in content if not in coverage)Educational Services (Post-Secondary Education) Award 2010

Nevertheless, the Submission which follows includes some sharp criticism of the Act and how it has operated. Despite this, NTEU would be very concerned if these criticisms were misinterpreted in a way which could aid the supporters of the previous “WorkChoices” legislation of 2006-2009.

2.Fair Work Act Fails to Meet Australia’s International Obligations

The Government has rightly included in the terms of reference consideration of Australia’s “international obligations”. This is obviously a reference to the Conventions of the International Labour Organisation which Australia has undertaken to uphold and reflect in its legislation. NTEU submits that the proper approach to the question “Does the Fair Work Act adequately take account of Australia’s international labour obligations?”should be to report on the extent to which the Actcomplies with those obligations.

The answer to that question remains that Australia is egregiously in breach of a number of core labour standards and remains a “rogue nation”. NTEU does not propose to recount in detail all of the breaches of Australia’s obligations under ILO Conventions. These are well set out in the ETU Complaint to the ILO regarding Freedom of Association 13 February 2009,[2] the substance of which was well summarised in the 357th Report of the Committee on Freedom of Association – ILO - (June 2010) at page 39, as follows:

In particular, the FWA remains in violation of freedom of association by:

(1)giving primacy to enterprise-level agreements and restricting the level at which bargaining can occur;

(2)limiting the content of agreements;

(3)providing insufficient protection to unionised workers who take industrial action in support of their rights under the Conventions;

(4)limiting the right to organise;

(5)restricting the right to strike beyond the limits permitted by the Conventions and lifting the protection of several types of industrial action, including sympathy strikes and those in support of multiple business agreements, “pattern bargaining”, matters that are not “permitted”, and strike pay;

(6)prohibiting industrial action in situations of “economic harm” and danger to the economy, including through the introduction of compulsory arbitration at the initiative of the Minister; and

(7)imposing penalties for engaging in “unprotected” industrial action and introducing secret ballot provisions. The complainant further maintains that the Bill‟s structure requires employers to bypass unions and make and reach agreements directly with employees, even where a union exists at the workplace.[3]

NTEU endorses the broad thrust of that Complaint and notes that the response by the Australian Government did not address the specific criticisms of the (then) Fair Work Bill, merely drawing to the Committee’s attention in most cases, as its defence, that the previous legislation was even worse.

Certainly, even the most cursory examination ofChapter 10 (Right to Strike) and Chapter 15 (Collective Bargaining) of the Digest of decisions and principles of the Freedom of Association Committee of the Governing Body of the ILOindicate that the Complaint made by the ETU is justified.[4]

B. Specific Issues which NTEU Wishes to Raise

The NTEU is aware of the number and size of submissions likely to be made to the Review. With this in mind, NTEU has decided to concentrate on a few issues which are less likely to be repeatedby others, or where the Union has specific experiences under the Act which form the basis of the points we raise. This does not mean that there are not other specific issues which we could have raised. Rather, we hope that our relative brevity may be rewarded with close attention.

1.Encouraging Secure Employment, Genuine Flexibility and Non-Discrimination Based on Type of Employment

As has been widely noted in the academic literature, casual employment in particular is at very high levels in Australia as compared to international standards.

Nevertheless, much of what is called “casual” employment is not casual at all, and much “fixed term” employment goes on from contract to contract, sometimes for more than a decade. For example, in higher education and in the State and Territory VET systems, the great majority of casual employment is not in work which is genuinely “casual” at all. Many examples can be found of “casual” employees with 5, 10 or even 15 years of ongoing casual service.

The suggestion is made in some quarters that the high level of casual employment reflects “employee choice”. It is very rare of course that anyone has ever been offered the actual choice. We do haveevidencefrom a 2007 ABS question on preference for casual employment that"52% of all casual employees reported that they would prefer not to work on a casual basis even taking into account the effect this may have on their income".[5]

During the “long boom” until the 1980s, casual and fixed term employment were largely residual forms which were used for genuine ad hoc or short-term employment, or were a form of indirect discrimination (partly enforced by unions), often associated with restrictions on part-time employment, or were used to deal with special circumstances in a particular industry, an example of which was the provision of residual teaching work for postgraduate students to supplement their income.

Certainly in the post-compulsory education sector, the use of casual employment has now ceased to be an imperative to meet organisational needs. The use of insecure employment has become an organisational strategy in its own right, used in order to avoid employee entitlements and to shift the burden of business uncertainty entirely onto employees. Taking Universities as an example, barely one-third of all employees have ordinary continuing employment in an industry with a remarkably stable revenue stream and relatively small fluctuations in activity, certainly compared to most other industries. Universities state quite openly that their employment mix is about transferring the risks of potential instability from employer to employees.

While in theory unions can bargain to restrict the use of casual employment, in the NTEU’s submission it should not be necessary to bargain for basic community standards such as sick and carer’s leave, bereavement leave or annual leave on behalf of employees who are not really casual at all, but have in most cases been unilaterally deemed to be casual by their employer.

NTEU accepts and has always done so, the need for the use of casual and fixed term employment to meet the genuine operational needs of employers, and even in rare cases, the preferences of employees, or to meet the particular circumstances of an industry.

However,“Casual” and “fixed term” and “temporary” should describe a type of work, not a type of employment contract.

At a minimum, the Fair Work Act should embody two principles in the Award stream:

• That the use of casual, fixed term and temporary employment should be the exception to ordinary ongoing employment, the use of which justified by particular circumstances to be established in Modern Awards on an award-by-award basis, having regard to the circumstances of the relevant industry or occupation covered by the relevant Award.

• An employee employed on a part-time, casual, fixed term or temporary basis must not be worse off overall in relation to the conditions of employment (including remuneration) under the Award, than a relevant full-time continuing employee.

To give effect to these, NTEU recommends the Fair Work Act 2009 (FW Act) be amended to incorporate a reference to a secure employment principle.

Part 2-3 of the FW Act deals with the operation of modern awards. The modern award objective in section 134 should be varied to include reference to the need to promote secure employment through the secure employment principle.

Section 134shouldbe amended by the addition of a sub-section (3) in the following terms:

Modern awards secure employment principle

(3) In making, varying or reviewing modern awards, FWA must give effect to the secure employment principle. For the purpose of this section, the secure employment principle means that;

(a)The normal form of employment should be continuing employment rather than casual, fixed term or temporary employment, subject to the following:

1. The established need for genuinely short term or ad hoc employment to meet the genuine operational requirements of an employer or industry;

1. The need to allow for seasonal or fluctuating employment in an industry or enterprise, to the extent that part-year or annualised arrangements are not practicable or appropriate, or not in the interests of employees;

1. Appropriate accommodation of employment on projects of limited duration, or replacement of employees on leave, or like circumstances;

1. Traineeships, apprenticeships, cadetships, internships or like arrangements where the relevant employees gain significant skills or experience which outweighs any disadvantage caused by a lack of job security;

1. The wishes of the majority of the relevant employees, and their representatives, in circumstances where FWA is satisfied that arrangements involving the use of non-continuing employees involve an clear overall advantage to employees, including those in less secure forms of work;

1. Arrangements to ensure any employee who was in a particular type of employment as at the [commencement of this sub-Section] and wishes to remain in that type of employment can do so;

1. Any necessary or desirable transitional arrangements which are deemed appropriate when any Award provision is made or varied under this Sub-Section.

and;

(b) Casual, fixed term, temporary and like employees who will be covered by the modern award will not be worse off overall in relation to conditions of employment regulated by the Award or the NES than comparable continuing employees are, or if there are no comparable continuing employees, to a continuing employee who might be, employed in the same circumstances to do the same work.

The proposed new Section 134 (3) (a) is relatively conservative in that it completely avoids a one-size-fits-all approach and allows the specialist tribunal – FWA – to take an industry-by-industry approach. It may well be that under proposed Section 134 (3) (a), in some industries or occupations, continuing employment would remain rare.This would not necessarily be inconsistent with the application of the secure employment principle. Moreover, the proposed 134 (3) (a) (vi) provides for a universal grand-parenting of any person employed at the time of commencement of the provision, who wishes to remain, for example, a casual employee.

Moreover, it is not proposed that the provisions of the proposed Section 134 (3) (a) be mandated in the bargaining sphere. However, the establishment of the secure employment principle in the award sphere would mean that employers would be bargaining for more insecure employment, rather than unions having to bargain for basic community entitlements like annual leave, for employees with years of continuous service.

Nevertheless, the principle that employees should not be discriminated against on the basis of being fixed term or casual “overall” is proposed by the NTEU to operate in the bargaining sphere as well as in the Award stream.

The secure employment principle would then be reflected in other relevant sections of the FW Act including Part 2-4 Enterprise Agreements. The NTEU recommends that the general requirements for the approval of an enterprise agreement by FWA be amended to provide the following:

186(2)(d) the agreement passes the better off overall test and does not disadvantage precarious employees. [new text in bold]

A corresponding new provision in relation to passing the better off overall test could be included in Section 193 as follows:

193(1A) An enterprise agreement is taken to disadvantage precarious employees if casual, fixed term part-time and/or temporary employees would be worse off under the enterprise agreement than a comparable full-time continuing employee employed under the enterprise agreement or, if there are no comparable continuing employees, compared to a full-time continuing employee who might be employed in the same circumstances to do the same work.

While it is legitimate for an employer to bargain hard over wages and conditions, there can be no justification for discrimination in remuneration and conditions overall as a “package” as between different types of employment for employees performing work in the same classification. For example, in higher education, Awards and Agreements are permitted which exclude casual employees from rights which attach to other employees, even though those exclusions have nothing to do with the casual nature of the employment. Common examples include access to enhanced superannuation, access to experience payments or incremental progression, the right to promotion or to have the classification of one’s position assessed or reviewed, or the right to be consulted about workplace change. What is proposed here is not even necessarily that all rights extended to permanent employees should be extended to non-casual employees. To do that may in many circumstances may be inappropriate or may in fact undermine the actual character of the employment relationship. Rather, NTEU is proposing that FWA should be satisfied that, under the Agreement, casual, fixed term and temporary employees should not be worse off “overall”.

In some industries and in some circumstances, especially in the past, unions must bear some of the responsibility for the unjustified discrimination against casual employees, just as they bear historical responsibility for past discriminatory provisions which adversely affected women or indigenous workers. Given the preponderance of women and young people among the casual workforce, discrimination in remuneration against casuals, fixed term and part-time workers doing the same job is likely to be a covert form of sex or age discrimination.

For Australia to adopt an approach of limiting discrimination based on type of employment would not leave us in a unique position. The United Kingdom, as well as the rest of the European Union has adopted similar regulation. The Part-time Workers (Prevention of Less Favourable Treatment) Regulations 2000 (UK) requires that employers give people on part time contracts equal pay to people on full time contracts who do the same jobs. It implements EU Directive 97/81/EC and forms part of the European Union’s programme to combat discrimination of atypical workers. Because the large majority of part time workers are female, it is also an important attempt to combat sex discrimination.

2.Requirement to End All Industrial Action rather than that which Threatens or “Has Threatened” Health Safety etc

In National Tertiary Education Union v University of South Australia [2010] FWAB 1014 a Full Bench of FWA on appeal considered the meaning of Section 424 of the Act, in circumstances where a wide range of protected industrial action was taking place but only a small fractionof that industrial action was found to threaten the health safety or welfare of the population or part of the population (Section 424 (1)). The Full Bench found that even in these circumstances, all protected industrial action must cease.

NTEU is not here disputing the correctness of the Full Bench’s Decision. However, the implications of this would seem to take the provision beyond anything that could be considered reasonable.

To take a more extreme hypothetical example, if 500 bus drivers have been on strike for a week, and one of these bus driver’s usual duties is to transport severely disabled children to day care, then assuming this is found to be a threat to “welfare”, the industrial action of all 500 bus drivers must be suspended or terminated. This only has to be stated to seem obviously unjust.

Moreover, using the same example, if the union had been contacted on the second day of the strike about the needs of the disabled children, and as a result the relevant bus driver returned to work transporting the disabled children a week before the Section 424 application had even been made, then because of the requirements of Section 424 (1) that “if FWA is satisfied that the protected industrial action has threatened, is threatening, or would threaten. . .” (emphasis added), the tribunal would have to suspend or terminate all the bus drivers’ action. This takes the law from injustice to absurdity.