Direct Request (CEACR) - adopted 2011, published 101st ILC session (2012)

Right to Organise and Collective Bargaining Convention, 1949 (No. 98) - Australia (Ratification: 1973)

Bargaining fees. The Committee had previously noted that section 353 of the Fair Work Act, 2009 prohibits an industrial association, or an officer or member of an industrial association, from demanding payment of a bargaining services fee, defined as a fee payable to an industrial organization or to someone in lieu of an industrial organization, other than membership fees, wholly or partly for the provision, or purported provision, of bargaining services. The Committee had further noted that parties could not include unlawful terms in a collective agreement, including a provision allowing for bargaining agent fees. The Committee had requested the Government to provide information on the practical application and any reported impact of section 353 on collective bargaining and to review this section, in full consultation with the social partners concerned, with a view to its amendment in the light of the Committee’s comments.

The Committee notes that the Government explains that the retention of the prohibition on clauses requiring the payment of bargaining service fees in the Fair Work Act reflects a decision of the High Court of Australia which ruled that such fees do not pertain to the employment relationship. The Committee takes note of the information and requests the Government to provide information on any further developments in the review of this section with the social partners.

Unlawful terms in collective agreements. The Committee had previously noted the concerns raised by the Australian Council of Trade Unions (ACTU) concerning certain unlawful terms that may not be included in collective agreements, such as: to extend unfair dismissal benefits to workers not yet employed for the statutory period; to provide strike pay; to pay bargaining fees to a trade union; and to create a union right to entry for compliance purposes that are different or superior to those contained within the Act and requested information on the practical application of these provisions as well as on any steps taken or envisaged to further broaden the potential scope of collective bargaining.

The Committee notes that the Government indicates that the Fair Work Act broadens the scope of the agreement content compared to the Workplace Relations Act as enterprise agreements can include terms relating to deduction of union fees, trade union training leave, renegotiation of workplace agreements, consultation with unions about change in the workplace and the role of unions in dispute settlement procedures. According to the Government, it has always been a feature of Commonwealth workplace relations law that industrial instruments should deal with matters pertaining to the employment relationship although such matters have evolved over time and terms that would be within the scope of matters pertaining to employers’ relationships with employees or unions under the Fair Work Act now include terms relating to: (1) staffing levels (particularly where the aim is to protect the health, safety and wellbeing of employees); (2) conditions or requirements on employment of casuals or engagement of contractors if the terms sufficiently relate to the job security of employees (such as terms requiring that the conditions of engagement of casuals or contractors will not undercut employees’ terms and conditions in the enterprise agreement); (3) conversions of casual employment to permanent employment; (4) restrictions on employers seeking contributions or indemnities from employees in relation to personal injuries caused by and to the person in the course of the employment; (5) paid leave for union meetings or activities; (6) methods for providing union information to employees. The Committee notes that the Government confirms that section 194 of the Fair Work Act defines the meaning of “unlawful terms” which cannot be included in enterprise agreements reflecting developments in Australian law on the question of matters pertaining to the employment relationship, and gives primacy to the Act as the source of rights and obligations in relation to general protections, unfair dismissal, right of entry and industrial action.

The Committee takes note of the application made by Fair Work Australia (FWA) of these provisions in the decisions provided by the Government, which is consistent with the Government’s approach and prevents parties to collective bargaining from including terms considered “unlawful” in their negotiations and agreements. The Committee notes that a decision of the full court of the Federal Court upheld a decision finding that a term that required the employer to obtain income protection insurance for its employees was a matter pertaining to the employment relationship and therefore not “prohibited content”. The Committee further notes in the ACTU comments that a full bench of FWA refused to approve a proposed collective agreement which contained a term entitling an authorized trade union representative to enter the employer’s premises at all reasonable times to interview employees, but not so as to interfere unreasonably with the employer’s business, on the basis that this term was “unlawful” even though it reflected consensual arrangements reached between the employer and the union concerning entry onto the employer’s premises. The Committee further observes that, according to the ACTU, the jurisprudence has proven confusing and inconsistent making it difficult for parties to identify whether a matter does or does not pertain to the employment relationship, and is therefore lawful or unlawful to negotiate over. The ACTU indicates that the jurisprudence has the effect of excluding from bargaining many matters over which workers and employers may legitimately wish to bargain including, for example, an employer’s environmental practices, restrictions on the proportion of contractors or labour hire workers used at an enterprise and provisions requiring an employer to take out private health insurance cover for employees and their families.

Finally, the Committee draws attention to the conclusions and recommendations reached by the Committee on Freedom of Association in Case No. 2698 (357th Report, paragraphs 213–229) which, noted in this respect, that, while section 172(1) of the Fair Work Act provides that an agreement may be made on matters pertaining to the employment relationship, deductions from wages, and the operation of the agreement, the exact scope of the term “matters pertaining to the employment relationship” remains elusive and sections 186(4) and 194, as well as sections 353, 470–475, exclude from collective bargaining as “unlawful terms” any terms relating to the extension of unfair dismissal benefits to workers not yet employed for the statutory period, the provision of strike pay, the payment of bargaining fees to a trade union and the creation of a union right to entry for compliance purposes more extensive than under the provisions of the Fair Work Act. The Committee on Freedom of Association recalled that measures taken unilaterally by the authorities to restrict the scope of negotiable issues are often incompatible with the Convention and that tripartite discussions for the preparation, on a voluntary basis, of guidelines for collective bargaining are a particularly appropriate method of resolving these difficulties. The Committee requests the Government to review the abovementioned sections in light of the above and in consultation with the social partners, and to broaden the scope of collective bargaining. The Committee further requests the Government to provide information in its next report on any steps taken or envisaged in this regard.

State jurisdictions. New South Wales. The Committee notes that the Government indicates in its report that, on 16 June 2011, the New South Wales Parliament passed amendments to the Industrial Relations Act 1996 requiring the NSW Industrial Relations Commission to give effect to the Government’s public sector policies when making or varying awards or orders relating to the remuneration or other conditions of employment of public sector employees and that, on 20 June 2011, the Industrial Relations (Public Sector Employment) Regulation 2011 was issued and declared the public sector policies that the Commission must give effect to, including the NSW Public Sector Wages Policy 2011. The Committee observes that the ACTU indicates that the adoption of the Industrial Relations Amendment (Public Sector Conditions of Employment) Act 2011 removed the right of the public sector unions to bargain effectively for wages and conditions of employment for its members across the state. The Committee requests the Government to provide its observations on these matters in its next report.