APPENDIX 5
Comparison of State Industrial Relations Systems
A. ACCESS TO AWARDS
All States, other than Victoria, still have systems of compulsory conciliation
and arbitration whereby employee's wages and conditions can be determined
by awards.
Because the States do not have the constitutional restrictions which
apply to the Commonwealth, it is possible for State awards to apply as
a 'common rule'. That is, that awards apply generally to the industry,
occupation or class of employees concerned and are not dependent on respondency.
In Tasmania, for example, all awards have a common rule effect. In other
States, this is the general position although more specific awards may
be made and in yet others, awards are binding only on those persons expressed
to be bound.
Western Australia has introduced provisions which attempt to limit the
ability of employees covered by State awards from moving to Federal awards.
The Minister has the power to suspend all or part of a State award where
a number of employees bound by that award are also bound by a federal
award. The Commission is then prevented from making an award or order
which extends to employees to whom the award would usually apply. If the
whole of the award is suspended, the Minister may apply to the Commission
to cancel the award (section 37A).
All State systems also provide for enterprise bargaining whereby employers,
employees and their unions can negotiate particular terms and conditions
to apply at the enterprise level. However, the interaction between the
award system and enterprise bargaining and the minimum conditions applying
to the bargaining vary between all States.
B. AWARD MAKING
New South Wales
The Commission may make an award on its own initiative or on application
setting fair and reasonable conditions of employment. Section 21 provides
that the Commission must, on application, make an award setting any of
the following conditions of employment:
- ordinary hours of employment;
- equal remuneration and other conditions for men and women doing work
of equal or comparable value;
- employment protection provisions;
- provisions relevant to technological change;
- sick leave;
- part-time work; and
- casual work.
Victoria
Under the Employee Relations Act 1992, all existing awards ceased
to operate other than as a source for certain minimum conditions of employment.
In 1995, further amendments completely abolished awards and separately
provided for the minimum conditions (Employee Relations (Amendment)
Act 1994).
Employers and employees are now unable to have the Employee Relations
Commission of Victoria make an award to regulate the terms and conditions
of their relationship. The two options are an employment agreement (collective
or individual) or by common law contracts of employment.
Queensland
The Queensland Industrial Relations Commission has the power to 'regulate
the conditions of any calling or callings by an award'. In addition, section
37 of the Act allows a Full Bench of the Commission to make general rulings
relating to any industrial matters in order to prevent a multiplication
of enquiries into the same matter.
Western Australia
The Western Australia Industrial Relations Commission retains the power
to make awards regulating the terms and conditions of employment. Alternatively,
employers and employees may enter into workplace agreements. Certain conditions
of employment (whether dealt with by an agreement or award) must comply
with the minima established by the Minimum Conditions of Employment
Act 1993.
If a workplace agreement is made, any otherwise applicable award or agreement
is excluded and the Commission no longer has jurisdiction while the agreement
is in force.
South Australia
Section 90 provides that the South Australian Industrial Relations Commission
may make an award 'about remuneration and other industrial matters'. Remuneration
is defined as 'wages, salaries, piece work rates, penalty rates, shift
premiums, special work rates and allowances'. 'Industrial matters' is
very broadly defined.
Certain minimum standards, which apply to contracts of employment and
agreements as well as awards, are set out in sections 70 - 72 and in the
Schedules to the Act (these are discussed below under Minimum Standards).
Tasmania
An award is usually made following an application to the Commission by
an interested organisation although the Commission could make an award
on its own motion. Tasmanian awards have a common rule effect, applying
generally to the industry, department or class of employees concerned
and are not dependent on any respondency or citation (section 38).
C. REGULATION OF BARGAINING
New South Wales
The system described is that under the Industrial Relations Act 1996
which becomes law on 2 September 1996.
The Act provides that agreements may be made between an employer and
relevant unions or directly between an employer and employees where at
least 65% of employees have approved the agreement by secret ballot.
The Commission may only approve an agreement if it meets the statutory
requirements; the agreement does not, on balance, provide a net detriment
to the employees when compared to the aggregate package of conditions
of employment under relevant awards which would otherwise apply to the
employees; the parties understand the effect of the agreement; and the
parties did not enter the agreement under duress.
Victoria
The Employee Relations Act 1992 provides for collective and individual
employment agreements. Collective agreements are negotiated between an
employer and at least two employees. Individual agreements are negotiated
between an employer and an employee. In both cases, the employees may
authorise representatives to negotiate on their behalf. In the case of
collective agreements, a committee of employees may negotiate.
In 1995, all awards were abolished and all employees who had not negotiated
employment agreements, were deemed to be covered by individual employment
agreements the terms of which were those of the relevant abolished award.
Section 25 provides that a provision of an employment agreement or any
other contract of employment is of no effect if its terms and conditions
are less favourable that the minimum conditions set out in Schedule 1.
Those minima are: 4 weeks paid annual leave; 1 week paid sick leave,
a minimum hourly wage as set by the Employee Relations Commission or that
equal to the base award rate; 52 weeks unpaid maternity leave; 52 weeks
unpaid paternity/adoption leave; minimum notice of termination; 13 weeks
paid long service leave after 15 years continuous employment and 10 public
holidays per year.
Queensland
The Queensland system is very similar to that currently contained in
the Industrial Relations Act. It provides for both certified agreements,
entered into between employer(s) and union(s), and enterprise flexibility
agreements, made between an employer and his or her employees. The same
no-disadvantage test applies to the certification/approval of agreements.
Western Australia
Workplace Agreements may be made either collectively or individually.
Collective agreements may be made between an employer and all or some
of the employees. Unions may represent an employee (if authorised in writing
to do so) but are not parties to the agreement.
An individual agreement is made between an employer and an individual
employee, and override a collective agreement to the extent of any inconsistency.
The minimum conditions applying to agreements are set by the Minimum
Conditions of Employment Act 1993. In brief, these are a prescribed
minimum weekly wage, 4 weeks' annual leave, 10 days sick leave, 2 days
bereavement leave, 10 public holidays, up to 52 weeks parental leave and
long service leave.
South Australia
Three types of enterprise agreement are available. An agreement may be
made between an employer and a group of employees, an employer and a group
of employees represented by a union or at 'greenfield' sites, an agreement
between an employer and the Employee Ombudsman or a union.
In the first type of agreement, the majority of the employees must approve
the agreement. A union may become a party to an agreement provided than
there is written authorisation by the majority of the employees for them
to act.
Certain minimum conditions apply to the making of an agreement:
- a minimum wage rate not less than that in the relevant award (ordinary
time earnings) and for non-award employees, that determined by the Full
Bench of the Commission;
- 10 days paid sick leave per year;
- 4 weeks paid annual leave;
- 52 weeks unpaid parental leave after 12 months continuous service;
- 13 weeks long service leave after 10 years of continuous service.
The Commission must approve the agreement once satisfied that: it was
negotiated without coercion; a majority of employees genuinely agreed
to be bound by it; reasonable steps were taken to inform employees of
the terms of the agreement; it provides for consultation between employers
and employees concerning organisational change and it does not provide
for minimum conditions that are inferior to those in the applicable award.
The Full Bench may nevertheless approve an agreement which does not meet
this last requirement if the enterprise is in financial difficulty and
at least two thirds of employees are in favour of it.
Tasmania
Enterprise agreements may be made between an employer and a union or
unions representing persons employed in the enterprise or at least 60%
of individuals employed in the enterprise or an employee committee representing
the employees.
Agreements must comply with certain minimum conditions; namely, the hourly
rate for the lowest paid classification in the award (a percentage of
this rate applies for those under 21), annual leave, sick leave, and parental
leave calculated on the basis of the lowest amount of leave specified
in any award.
Agreements are lodged with and registered by the Employment Commissioner.
The Commissioner holds a hearing at which he/she must be satisfied that
the employees are aware of their current entitlements and the changes
to those entitlements made by the agreement. It must be registered by
the Commissioner unless satisfied that the minimum conditions are undermined;
the bargaining process was unfair; or the agreement was made under duress.
D. REGULATING MINIMUM CONDITIONS
This section examines the provisions, if any, in the various State legislation
establishing minimum wages and conditions other than by awards.
New South Wales
Apart from annual leave and long service leave, NSW does not have any
universally applicable minimum conditions (outside the award system).
However, it should be noted that awards of the NSW Commission be generally
operate as a 'common rule' award so that all employers and employees within
that industry are automatically bound by that award, whether they were
notified of the proceedings or not (section 12). In addition, all employees
have access to parental leave (other than casual or seasonal employees).
Victoria
In 1992, awards were abolished. The Employee Relations Commission may
set and adjust minimum wages for employees within a work classification
(section 21); however, an initial minimum wage can be set only after application
by the Minister. In settling the level of a minimum wages, the Commission
must consider:
(a) the needs of workers and their families, taking into account the
general level of wages in Victoria, the cost of living, social security
benefits and the relative living standards of other social groups; and
(b) economic factors, including the requirements of economic development,
levels of productivity, and the desirability of attaining and maintaining
a high level of employment (section 23).
Section 25 provides that a provision of an employment agreement or any
other contract of employment is of not effect if its terms and conditions
are less favourable that the minimum conditions set out in Schedule 1.
Those minima are: 4 weeks paid annual leave; 1 week paid sick leave,
a minimum hourly wage as set by the ERC or that equal to the base award
rate; 52 weeks unpaid maternity leave; 52 weeks unpaid paternity/adoption
leave; minimum notice of termination.
Queensland
Under Part 4 of Division 4, the Commission has the power, on application,
to make an order setting the same minimum wages for all employees in a
specified group. Such an order can only be made for employees who do not
have a minimum wage rate set by an award or agreement.
In setting such minimum wages, the Commission must consider:
- the principles applying to setting award wages;
- the needs of workers and their families; and
- economic factors including economic development, productivity levels
and the desire to reach and maintain a high employment level.
Western Australia
The Minimum Conditions of Employment Act 1993 established certain
minimum conditions which underpin both awards and workplace agreement.
Prior to this Act, the WA Commission had the power to make General Orders
under section 50 which could specify minimum conditions of employment
for award and non-award workers. The Commission still retains this power;
however, it cannot make an order on a matter already covered by the Minimum
Conditions of Employment Act.
The conditions established under the Minimum Conditions of Employment
Act are as follows:
- a minimum weekly rate of pay which is reviewed annually by the Commission
which then recommends an appropriate rate to the Minister. The Minister
may accept this recommendation or make his or her own determination.
The current weekly rate for full-time adults is $317.10. No penalty
rates, loadings or allowances may be prescribed in this minimum condition.
- 10 working days or 180 hours paid sick leave per year (whichever is
the lesser);
- 4 weeks paid annual leave;
- 2 days bereavement leave;
- 10 specified public holidays;
- 52 weeks unpaid parental leave after 12 months of continuous service;
- Employees have a right to be informed about significant changes to
the employers operation which will affect them and about any decision
to make the employee redundant.
South Australia
Section 69 specifies that the minimum rate of remuneration payable for
award employees is the hourly rate prescribed in the award. For non-award
workers, it is the minimum rate fixed by the Commission.
Subsection 62(2) requires the rate of remuneration fixed by a contract
of employment, an award or an enterprise agreement 'must be consistent
with the Equal Remuneration Tribunal'.
Schedule 3 of the Act sets out the minimum sick leave entitlements (5
days per year). Schedule 4 provides for 4 weeks annual leave for each
year of service. Schedule 5 provides for 52 weeks unpaid parental leave
for those with 12 months continuous service.
Tasmania
While Tasmania does not have any generally applicable minimum conditions
legislation, awards made by the Tasmanian Commission have a common rule
effect.
E. UNFAIR DISMISSALS
New South Wales
The NSW Industrial Relations Commission determines whether a dismissal
is harsh, unjust or unreasonable. The Commission may take into account
a number of matters to determine this question, including whether a reason
for dismissal was given, whether the employee had an opportunity to respond
to allegations, and whether warnings of unsatisfactory performance were
given.
The Commission may order reinstatement or, if this is not practicable,
re-employment. In addition, the Commission may order that the employer
pay an amount that the employee would have earned but for the dismissal.
If neither reinstatement or re-employment is practicable, the Commission
may order compensation of an amount not exceeding 6 months pay.
Victoria
The Victorian Employment Relations Commission must determine whether
a dismissal is harsh, unjust or unreasonable. However, the employee must
first have attempted to resolve the matter directly with their employer.
In addition, the employee must first establish a prima facie case that
their dismissal was harsh, unjust or unfair before the Chief Commission
Administrative Officer.
The Commission may order reinstatement and compensation for lost earnings.
However, no compensation is payable unless re-employment is ordered (section
42).
Queensland
The Queensland law substantially mirrors the existing Commonwealth provisions,
under which the Queensland Industrial relations Commission determines
whether a dismissal is unlawful (where there is not a valid reason or
where it is for a prohibited reason).
The Commission may order reinstatement or where this is not practicable,
compensation which is limited to a maximum of 6 months remuneration.
Western Australia
For employees covered by the Industrial Relations Act (ie award employees),
the Western Australia Industrial relations Commission determines whether
the dismissal is harsh, oppressive or unfair. For employees covered by
state employment agreements, a magistrate determines whether the dismissal
is in breach of an implied term in the agreement which prohibits harsh,
oppressive or unfair dismissals.
The Commission or the Magistrate may order reinstatement or where this
is not practicable, compensation which is limited to a maximum of 6 months
remuneration.
South Australia
The South Australian Industrial Relations Commission determines whether
a dismissal is harsh, unjust or unreasonable having regard to the matters
set out in International Labour Organisation (ILO) Convention 158. The
Commission may order reinstatement, or where this is not practicable,
re-employment. If neither of these options is appropriate, the Commission
may award compensation limited to 6 months remuneration or $30,000, whichever
is the greater.
Tasmania
The Commission deals with unfair dismissal as part of its dispute settling
function. It is required to take ILO Convention 158 into account when
settling an industrial dispute arising out of the dismissal of an employee.
The Tasmanian Supreme Court has held that the Commission does not have
jurisdiction to award monetary compensation for dismissal unless reinstatement
has also been sought. [1]
Footnotes
[1] New Town Timber & Hardware Pty Ltd
v. Gurr and Anor [1995] AILR 15-021.