The Fair Work (Commonwealth Powers) Amendment Bill 2017 (the Bill) proposes to enable public sector employers and employees (excluding law enforcement officers) to bargain over, and reach agreement on, matters relating to the number, identity or appointment of employees.
Under the Referral Act, the Victorian Government referred certain industrial relations matters to the Commonwealth to bring other Victorians into the federal industrial relations system. However, the Government excluded from the Referral Act certain matters relating to public sector employees.
This exclusion was based on an understanding of the implied limits on Commonwealth legislative power. In Re Australian Education Union, the High Court held that certain matters relating to State employees were critical to a State's capacity to function as a government and therefore beyond the Commonwealth's legislative power. These matters included a State's right to determine:
- the number and identity of its employees;
- the length of employees' employment; and
- the number and identity of those whom it wishes to dismiss on redundancy grounds.
In 2015, however, the Full Federal Court held in United Firefighters' Union of Australia v Country Fire Authority that, where there was voluntary agreement about such matters, there was no practical impairment of the State's capacity to function as a government. As a result of this decision, such matters may be included in enterprise agreements that cover constitutional corporations and their employees.
The proposed changes will enable those public sector employees and their employers to include in enterprise agreements enforceable terms dealing with matters such as minimum staffing levels, staffing ratios, or the number of casual, seasonal or fixed term employees.
The Bill also proposes to empower the Fair Work Commission to make workplace determinations in respect of those public sector employees and their employers which include agreed terms dealing with these matters.
However, the Bill does not propose to:
- empower the Fair Work Commission to arbitrate bargaining disputes about these matters, or make an award including these matters in relation to public sector employers and employees; or
- permit these matters to form part of an enterprise agreement, workplace determination, or other transferable instrument that applies to public sector employers and employees as a result of a transfer of business.
Accordingly, terms dealing with the number, identity and appointment of public sector employees may only be included in an instrument by agreement. As is the case with all terms to be included in enterprise agreements, employers will need to carefully consider the long-term implications.
Assistant Victorian Government Solicitor
This blog was prepared with the assistance of Jack Maxwell, Trainee Lawyer, and Emma Buckley Lennox, Seasonal Clerk.