Fair Work changes pose threat to business

New workplace legislation - which comes into effect today - poses new challenges for business

The Federal Government’s Fair Work legislation comes into effect today, along with a fresh-faced industrial tribunal.

According to the Australian Chamber of Commerce and Industry (ACCI), it marks a significant point in the country’s often controversial workplace relations law.

ACCI Acting Chief Executive Greg Evans says the new laws provide plenty of contemporary challenges for Australian employers.

"The nature of those challenges will vary and depend on the particular circumstances of individual businesses, whether they be SMEs, regionally-based, or large organisations operating across national boundaries," Evans says.

"For small businesses owners, one of the biggest challenges is their renewed exposure to the unfair dismissal laws, having been sheltered from their operation for the past three years," he says.

Fair Work Australia has already appointed 25 roaming conciliators to handle unfair dismissal matters, flagging a possible upsurge in claims.

Evans warns that in six months time, SME’s will also have to adjust to the introduction of the ten National Employment Standards and the new "modern award" changes.

"The new so called ‘low paid sector’ mechanism that enables unions to target individual employers and to seek to negotiate with them as a group can also be expected to encompass many small businesses in various industry sectors," he says.

"Fair Work Australia could also step in and arbitrate if those negotiations become deadlocked."

For big business, the changes to bargaining and agreement making are likely to pose the greatest challenges, including:

  • Enhanced union representation rights

  • The potential to obtain "majority support determinations"

  • The new untested "bargaining in good faith" obligations

  • The removal of the prohibited content list, meaning that many more non-employment related items will now be on the union bargaining wish list

  • The ability for a single agreement to now cover multiple employers

The right of entry changes mean unions no longer need to be a party to an award or an agreement at a particular workplace to be able to exercise right of entry at that location.

In an Australian first, significant anti-discrimination provisions have also been embedded in industrial relations law.

"New provisions in this area also enable an employer to be prosecuted if found to have taken ‘adverse action’ against an employee for acting in accordance with a legal entitlement the employee has in that workplace," Evans says.

"The potential for claims in this are is exacerbated by a reverse onus of proof, no limits on the amount of compensation that could be awarded to an employee, and actions against an employer able to be instigated by the Ombudsman," he says.

While only time will tell, it would seem today’s changes pose a real challenge for Australian employers, especially considering the current economic climate.

"It is imperative in this environment that the new Fair Work laws operate in a way that provides outcomes that are both fair for all, and contribute to the economic recovery that is so important to all Australians," Evans says.

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