Workplace Relations Update

Welcome to the latest KHQ Workplace Relations and Safety update. Now that COVID-19 related employment issues have started to calm (though we don’t envy the Fair Work Commission its backlog of claims!) we thought it time to return to the comfort of those longstanding industrial relations and human resources issues that we’ve continued to grapple with, alongside the issues of vaccinations and a (at least partial) return to the workplace.

In this update, we look at the developments in some key areas for employers and industrial relations and human resources professionals over the beginning of 2022 (and leave COVID well alone):

TRANSFER OF BUSINESS IN THE FAIR WORK ACT

A recent decision of the Federal Court in Crown Sydney Gaming Pty Ltd v United Workers’ Union[1] has considered the transfer of business provisions of the Fair Work Act in the context of Crown seeking to transfer to Crown Sydney experienced dealers, area managers and security officers who were working at Crown Melbourne and Crown Perth.

The critical question in this case was whether the employees could be said to be performing ‘the same or substantially the same’ work at Crown Sydney as they had at Crown Melbourne or Perth such that there would be a transfer of business within the meaning of s.311 of the Fair Work Act 2009 (Fair Work Act). Crown Sydney sought declarations from the Federal Court that there would not be and accordingly that the enterprise agreements covering the employees at Crown Melbourne and Perth would not transfer with them to Crown Sydney.

Somewhat surprisingly, there is relatively little case law considering the interpretation of the phrase ‘the same or substantially the same’. In this case, Jagot J found that the work was not ‘the same or substantially the same’ for reasons including:

  • the change in the location of the work performed by the employees;
  • that if the tasks being performed for Crown Sydney were the same or substantially the same as those the employees had performed for Crown Melbourne or Perth, they would be being performed in Sydney, in a new facility and in a new business enterprise and the existing facilities in Melbourne and Perth would continue to be operated by Crown Melbourne and Perth;
  • this wasn’t a case where the employer was transferring employees within a business from one location to another and the employees continued to carry on the same work in the new location (which could be a situation in which the location may ‘have no bearing’ on the question of whether the work was the same or substantially the same);
  • Crown Melbourne and Crown Perth had no capacity to direct the employees to continue to perform their work for Crown Sydney at the new location; and
  • the facilities at Crown Sydney would not be open to the general public, unlike those in Melbourne and Perth, and accordingly the facilities and tasks performed would be different.[2]

This decision represents some broadening of the types of factors considered in determining what constitutes ‘the same or substantially the same’ work. In this case location was the relevant factor, but the decision signals that other factors that distinguish the work previously performed could be relevant in answering that question. All of that said, the decision is a short one with reasoning that is not entirely detailed and so it will be interesting to see further developments in subsequent decisions.

The approach of seeking a declaration from the Federal Court rather than orders of the Fair Work Commission regarding the transferring instrument was also of interest in this case, and enabled Crown Sydney to make conditional offers of employment to employees, given the seeking of future Commission orders was kiboshed by the Full Bench of the Commission in 2019.[3]

SEXUAL HARASSMENT

Continuing substantial damages awards

We have continued to see substantial awards to applicants in cases where sexual harassment is established, which has followed from the decision of the Full Court of the Federal Court of Australia in in Richardson v Oracle Corporation Australia Pty Ltd (Oracle).[4]

Recently, the Victorian Civil and Administrative Tribunal (VCAT) awarded general damages of $150,000 to an employee of a beauty therapy business who had been subject to sexual harassment by a co-worker over a period of approximately 11 months, culminating in a sexual assault by the co-worker. The full decision of VCAT is available here.

The employer was held vicariously liable for the sexual harassment by the employee’s co-worker as VCAT found that it had not taken reasonable precautions to prevent the sexual harassment (and therefore could not rely on the exception at s110 of the Equal Opportunity Act 2010 (Vic) (Victorian EO Act)).

This case represents further reinforcement that it is not enough to simply have a policy on sexual harassment (or discrimination, bullying or harassment) and to circulate that to employees on commencement. Here, the critical failure of the employer to ensure that the policy was read and understood by employees and to provide regular training on the policy, together with the inadequacy of the steps taken when harassing behaviour was reported, led to VCAT’s finding that reasonable precautions were not taken.

In awarding that amount of general damages, VCAT had regard to the approach in Oracle, along with the positive duty on employers in s15 of the Victorian EO Act to take reasonable and proportionate measures to eliminate discrimination, sexual harassment or victimisation as far as possible.

Expanded Commission jurisdiction

There have, to date, been two published decisions arising from the expansion of the Commission’s existing stop bullying jurisdiction which, since 11 November 2021, also enables workers to apply for orders to stop sexual harassment at work. Both were dismissed due to the Commission finding that there was no ongoing risk of sexual harassment occurring “at work”, in one case because the applicant was no longer employed by the employer at which the sexual harassment was said to have occurred and in the other because there was no ongoing prospect of the parties being in the same location while at work.[5]

GIG ECONOMY AND INDEPENDENT CONTRACTORS

In the gig economy space, different approaches continue to be taken by on-demand food delivery businesses with Menulog continuing to push for a new modern award for the on-demand delivery industry. On 28 January 2022, a Full Bench of the Fair Work Commission held that the existing Road Transport and Distribution Award 2020 covered employers and courier delivery employees, however Menulog continues to argue that a specific award for the industry is warranted. The matter is listed again for conciliation before the Commission on 18 May 2022.

Another provider, Door Dash, has agreed a ‘statement of principles’ with the Transport Workers Union covering items including access to rights and entitlements, transparency, opportunities to “contribute to a collective voice” access to dispute resolution and resources being allocated to establishment and maintenance of on-demand industry standards and to driver education and training. This statement is said to be the first stage in a three-stage approach to establishing a regulatory framework, with a more detailed Memorandum of Understanding to be agreed at stage two and lobbying of government for the implementation of regulatory framework at stage three.

Of course, the more significant development in the gig economy space (and beyond) in 2022 so far has been the decisions of the High Court in CFMEU v Personnel Contracting Pty Ltd [2022] HCA 1 and ZG Operations Pty Ltd v Jamsek [2022] HCA 2.

These decisions represented a move away from the ‘multi-factorial’ test that had historically been considered in these cases and affirmed that, where the terms of the parties’ relationship are comprehensively committed to a written contract then the focus is exclusively on the rights and obligations of the parties in that contract itself.

It is not as simple as some commentary has made it out to be, and not just a case of designating a relationship as one of ‘contractor’ and saying that’s that (unfortunately!). Additionally, and importantly, subsequent conduct of the parties can be relied upon in challenging validity of contracts, asserting there has been a variation or waiver or that the arrangement is a sham – so we will be watching this space closely to see if claims in these areas increase.

It is however definitely the time to review and carefully consider your contractor terms and to ensure that your contractor agreements comprehensively set out the rights and obligations of the parties.

WA LONG SERVICE LEAVE

Changes to long service leave (LSL) in Western Australia are afoot following passage of the Industrial Relations Legislation Amendment Bill 2021 through the Western Australian Parliament on 16 December 2021. Relevantly for employers in the federal system, these changes impact provisions of the Long Service Leave Act 1958 (WA) (WA LSL Act).

The amount of LSL that employees are entitled to under the WA LSL Act remains unchanged and the amendments largely represent clarification and refining of existing provisions. Specifically, the changes relate to:

  • confirming that casual and seasonal employees fall within the definition of ‘employee’ for the purposes of the WA LSL Act;
  • amendments that provide that casual or seasonal employees have continuous employment:
    • despite absences under their terms and conditions, caused by seasonal factors or where the employee, after the end of the absence, has a reasonable expectation of returning to work due to the regular and systematic nature of the employment;
    • where they are employed by one employer under two or more contracts of employment or are also employed by another employer;
  • clarifying how ordinary pay is calculated, including for casuals and seasonal employees where ordinary pay will be calculated on the basis of average hours of work during the period of continuous employment (so that weeks when there are no hours of work are taken into account);
  • clarifying the types of absences that do and don’t count towards periods of continuous employment and that do and don’t break periods of continuous employment;
  • allowing for LSL to be take for any period (e.g. single days) and providing for LSL to be taken on half pay or double pay;
  • clarifying provisions for cashing out of long service leave and making clear what constitutes an ‘adequate benefit in lieu’ for such cashing out – this includes additional record-keeping obligations regarding cashing out arrangements;
  • replacing the current ‘transmission of business’ provisions in the WA LSL Act with transfer of business provisions that pick up the definitions from the Fair Work Act; and
  • increasing penalties for failure to keep records and transfer records of transferring employees – with penalties now up to $65,000 (or $650,000 for serious contraventions) for bodies corporate and $13,000 (or $130,000 for serious contraventions) for individuals.

The legislation enabling these amendments was passed in December 2021, but the amendments will only take effect on a date yet to be proclaimed. We will keep you updated when that occurs.

VICTORIAN GOVERNMENT SCHEME PROVIDING SICK LEAVE FOR SOME CASUALS

The Victorian Government has introduced a sick pay guarantee for casual employees and self-employed workers working in hospitality, food preparation and food trades, sales assistants, sales support workers and others in supermarket supply chains, aged and disability care, cleaning and laundry work and security and guard work.

The scheme provides up to 38 hours of personal and/or carer’s pay to eligible workers paid at the national minimum wage (regardless of whether leave is taken on a weekend, weekday or public holiday). It is administered entirely by the Victorian government without involvement of employers, except for the provision of evidence of employment and potential verification and auditing by the Victorian government.

OH, AND THERE’S AN ELECTION …

Finally, we are of course awaiting the result of the Federal election to see what changes come in the IR space.

With Labor promising matters such as ‘same job same pay’ in the labour hire space, reversal of penalty rate decreases in retail and hospitality industries and increasing penalties for wage theft, there will be plenty to do if the pollsters are correct and the ALP wins on 21 May. If the current government is returned, indications are that at least some elements of the Omnibus Bill shelved late last year may be reignited.

What we don’t appear to be facing is any wholescale change to the Fair Work regime, but again watch this space and we’ll be sure to keep you updated as things progress.

***

We’re otherwise enjoying being able to be on planes again and visiting those of you who are Interstate so we look forward to more catch ups in person in the near future. In the meantime, if you’d like to discuss anything in this update further, please don’t hesitate to give us a call.

 

[1] [2022] FCA 97

[2] See at [14]

[3] See TWU v Viva Energy Australia Ltd [2019] FWCFB 6212.

[4] [2014] FCAFC 82

[5] See THDL [2021] FWC 6692 and Application by Ranmeet Kaur [2022] FWC 487.

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