Australian Workplace: Fair Work Australia Act - Case Study Example

Running Header: Fair Work Australia Title Essay Fair Work Australia Student Details Student’s Name: Instructors’ name: Course Code: ‘Statement of own work’ This is to confirm that the work produced on this document is my own work and shall not in way be reproduced, copied or submitted for any award or an academic certificate without permission. Signature: Date: Fair Work Australia Fair Work Australia (FWA), is an institution that was established by the Federal government of Australia in the year 2009 as provided by the Fair Work Act of 2009. The institution is expected to carry out industrial relations related functions in the country. The institution officially commenced its work on 1st July 2009. As we will see later in this discussion, the FWA is entitled with a number of obligations which include the setting of modern awards, minimum wage, conflict resolution, enterprise agreements approvals as well as tackling claims related to unfair employee dismissals. FWA being an institution that was established to succeed the Australian Industrial Relations Commission also performs the functions that were previously performed by Workplace Authority and the Australian Fair Pay Commission. In this discussion we will also critically look into the institution’s roles, the motive behind its establishment, and the similarity in functionality with the Australian Industrial Relations Commission, the Australian Fair Pay Commission as well as its future in the Australian industrial relations system. The discussion will further analyze various human resource management theories that influence the outcome of the institution as argued by Barnes & Lafferty (2010). There are several key terms that are used in the essay and play a significant role in the discussion of Fair Work Australia. They include redundancy, disputes and appeal. Redundancy is the process of laying-off employees from work. The company can take this step for a number of reasons which include the high cost of doing business and when the position is believed not to be beneficial to the business. The term dispute can be used synonymously with the word disagreement in industrial relations. The term is used to define those areas of conflict between the employer and the employees. Appealing is the process of seeking justice especially when one party feels that whatever decision that has been taken against him is not and wants it to be readdressed. Fair Work Australia plays several roles as discussed within the essay. Fair Work Australia is a national labour relation tribunal established and given the mandate by the Fair Work Act 2009 to carry out a number of tasks which include the following; minimum wage setting, safety working environment, enterprise bargaining, industrial action, dispute resolution and dismissal of employees. The Fair Work Act was passed to bring about a new regulation that will create a system that has national outlook for the purpose of regulating industrial relations in Australia. According to this Act, each state in Australia is expected to submit some of its powers to the commonwealth and incase a state opts to refer its powers to the industrial relations systems, then all the workers in that particular state will automatically qualify to be the subject of the Act. Many of the roles of the institution are derived from the predecessor which was Australian Industrial Relations Commission (AIRC) which was entitled with the responsibility of industrial disputes and other related issues such as the minimum wage and the modern award systems according to Bramble (2008). They were several reasons that led to the establishment of Fair Work Australia Act. Fair Work Australia Act was established due to change the working conditions and environments of various employees in Australia. As at 1st of July 2009, the Act was expected to be fully in place in order to manage all matters related to industrial relations running from several dismissal claims, discrimination, redundancies, wage cases, labour disputes and award matters. According to the government, the Act was aimed at replacing the Work Choice Legislation. The act was intended at providing a more balanced system that will ensure safety for all workers especially during the troubled economic period. The instant agenda for the Act was actually to tackle the problem of employee dismissal that was so rampant among so many employers. Under the new Act, even less than 15 employees could be included whereby both part-time and long-term casual employees are considered as illustrated by Creighton & Stewart (2010). Human resource management as well as industrial relations were among the reasons that led to establishment of the act. The Fair Work Australia was established as one way of dealing with injustices done at workplaces especially for the employees. These injustices are commonly founded on different human resource management models that do not real regard employees as equals and therefore encouraging unfair treatment at workplace. Such human resource management models include Authoritarian whereby the decisions that are made by mangers are final and unquestionable as stated by Maconachie & Stone (2009). High individualism is another model used in human resource management whereby decisions are made by high level management team. In this case orders are made from above and the juniors are instructed to implement. These models and many more have instigated a lot of uneasiness among the employees thereby leading to the formation of trade unions to fight for their rights. The Act provides so many major changes with regard to unfair employee dismissal legislations. According to the former legislation, small enterprises were not catered for in matters regarding employee dismissal and therefore creating a situation where a number of employees working in small business hired and dismissed just like that without following the due procedures. But under the new law, employees can now make formal their complaints especially when they feel that they are not handled fairly as stated by Cooper & Ellem (2009). The act allows sacked employees to lodge claims on unfair dismissal within two weeks. Within the Act Small Business Fair Dismissal Code of Practice has been included which prompts small businesses to comply with it. As provided by this code, employers are allowed to dismiss their workers as long as they do it fairly. Redundancy is a very common concept in human resource management. It explains the process by which the employer can declare some positions to be redundant by laying some of the employees off their duties. In most instances redundancy is aimed at reducing the number of employees who work for any particular company. Redundancy is always expected to be a genuine process but however many employers do not follow the laid down rules. For example many positions are declared redundant by the employers when the occupant is on sick leave, study leave and even during the maternity leave as explained by Bowden (2011). To help solve the problem, the Act provides that due process must be followed by every employer when declaring a position redundancy and in any case the proper procedures are not followed one is empowered by the Act to appeal against the decision. Appealing is the legal process of seeking justice especially when an employee feels offended by his employer. As provided by Fair Work Australia Act, appeals can be made by an individual employee or members of the union depending on the decision that was made and the appeal can be listened to by the full bench as provided by the Act which will then offer judgment on the matter. With regard to private clauses, industrial relations laws limit appeals to court from full bench. Judicial powers as provided by the law, enables easy enforcement of decisions and injunctions reached by the court. In giving orders, the AIRC, has no power except by the court and in most cases the Federal Court of Australia as argued by Bray & Macneila (2011). Fair Work Australia Act has now made it very easy to dispute a decision especially when one party is not satisfied. Some of the common sources of disputes at the workplace include employment conditions such as breaks, overtime allowances, maternity leaves as well as public holidays. Others include payment rates, redundancy entitlements, discrimination, consultative processes, right of entry, relevant award procedures and compliance with laws and regulations as stated by Bowden (2011). Disputes can always be solved through conciliation and arbitration as provided by the new law. Disputes in many occasions can translate into serious problems such as strikes, lockouts as well as work-to-rule. To some level it can be very expensive for both the employer and the worker. Production is likely to be affected and business income affected. The process of conciliation is aimed at creating a forum where the two warring parties come together to solve their problem with the assistance of the arbitrator or conciliator. The arbitration process helps in solving the dispute given the submissions made by the two parties. An award is given by the arbitrator after carefully listening and assessing the arguments presented by each party. This is the fastest and less costly way of settling disputes (Bray & Macneil, 2011). Incase of private arbitration, AIRC is only given the mandate of interpreting the federal law only if the parties are in agreement to apply the private arbitration. However, frequent use of arbitration can be meaningless since there is a possibility that the two parties may not show genuine attempt in sorting for a solution. Secondly, the parties are not bound in any way to adhere to the award and therefore the outcome may not have much effect. Finally the arbitration process is long and if not carefully followed it may overshadow the outcome as revealed in Section51 (35) of the constitution (Bray & Macneil, 2011). According to the new Act, a number of changes have to be made in the Award System of Workplace entitlements. Awards will continue but now they will be called modern awards. In the current system there are thousands of awards across the country and its application varies from one state to another. The new legislation is expected to cut down the number of the awards. One major change that is likely to take place is the one that regulates parental leave. Under the present policy, it is only one parent who is entitled to one year of unpaid leave but the new law now advocates that both parents can take unpaid for 12 months. The parents are expected to take the leave consecutively. This is a regulation that the employer must abide with in the new law for national employers, small enterprises and same sex couples as presented by Cooper & Ellem (2009). The Ombudsman is a statutory office established by the Fair Work Australia Act 2009. The ombudsman’s jurisdiction is provided by in the Act and is expected to work independently from the government and is expected to make his own decisions and investigations. The office is established to carry out a number of functions which include harmonization of working conditions and terms of employees in the country, promoting workplace relationships (Barnes & Lafferty, 2010). Public information for employees is also provided by the office of the ombudsman who assumes the responsibility of educating the employees on their rights and what is expected of them. The ombudsman also assists in carrying out investigations on claims made by the employees as well as providing advice on matters related to workplace relations between the employers and the employees (Barnes & Lafferty, 2010). Fair Work Australia Act has brought about various changes within working environment. The new legislation has set New Employment Standards that provide a workplace framework under which the employee is expected to work in. In the previous legislation there were five in number and in the new Act they are ten. The list of standards has been increased as one way of taking into consideration all contentious issues that always cause conflicts between the employers and the employees (Bramble, 2008). The new standards include maximum number of hours of work per week, flexible working arrangements, parental leave, annual leave, carer’s leave and compassionate leave, community service leave, long service leave, public holidays, termination and redundancy pay and the right to access information on Fair Work Information Statement (Bramble, 2008). The Act has created a new framework that enables enterprises to do bargaining without engaging the unions and other forms of dispute resolution such as arbitration. This is done by approving majority employees’ decision. In this context, the agreement is build on good faith kind of bargaining. It is important to note that many employees are engaging in good faith bargain without any kind of intervention. But for those who are yet to comply, the Act orders compliance with good faith bargaining (Cooper, 2009). Australian Industrial Relations Commissions have also been established and have several functions. The commission was established in 1988 in order to replace the Australian Conciliation and Arbitration Commission. The act also replaced three other tribunals that were used to regulate the maritime industry, public employment as well as the airline pilots. The commission provided provisions for dual appointments and registered agreements apart from giving provisions for demarcation disputes. In the early 1980s, wage changes were being made in order to reflect the true economic environment. Following a number of wage decisions that were made in 1987, it was found to be very necessary to come up with a special framework that will ensure efficiency and high productivity Bramble (2008). This led to the establishment of the commission in order to develop principles that will regulate wage awards and workplace conditions in order to attain modernization (Waring & Cooper, 2009). Section 15 of the Act gives the AIRC the authority to approve any collective agreements. The commission is also charged with the responsibility of administering the No Disadvantage Test (NST) prior to certifying agreements apart from listening to and determining employment terminations that may be regarded as unfair dismissal applications. The Workplace Relations Act of 1996 allows the commission to simplify awards as provided for in Section 89A, implement the NDT and be part of industrial dispute resolutions (Waring & Cooper, 2009). Australian Fair Pay Commission is one of the commissions. The principle function of the commission is wage-setting as provided by Section 22(1) of the Act. The Act allows the commission to review wages and making necessary changes as illustrated by Sappey (2009). The powers of the commission as provided by the Act enables it to set minimum wage level for all employees, validating minimum wage for the special groups such as the disabled and determining periodic rates and basic pay rates. A part from wage setting, the commission is also expected to promote public understanding on matters that are related to wage setting as presented in Section 21(d) of the Workplace Relation Act. The main purpose of setting minimum wage is intended at promoting economic growth among the Australians as explained in Section 23 of the Act. By doing this the commission is expected to take into consideration the unemployed and the low paid in order to have them remain employed. The commission needs to offer safety net for those who are low paid, employment, and training as well as create competitive labor market as argued by Cooper (2009). The Fair Work Australia has a great role to play in the future. The passing of the new bill on Fair Work Australia according to the Rudd Government will see individuals who oppose fairness at workplaces working committed to working together to ensure equity and fairness among all the employees. However, the challenge to the Act is founded on the fact that there are those who opposed the move by the government to pass the bill as revealed in the debate which show great humiliation for the Liberal Party which was against the Act (Forsyth & Stewart, 2009). Given the politics that surround the Act it is evident that change of government can lead to the abolishment of the Act. For example the Liberal Party’s leader has been presented as an opportunist from his quote through the ABC Adelaide radio that Work Choices in Australia is dead meaning that the Act is of no use in the contemporary Australian industrial relations. In the House and the Senate, Mr. Turnbull together with the Liberal Party voted for complete reversal of the Act in order to allow for the continuation of Work Choices. The liberals also opposed the amendment of the bill and since its passage there have been frequent political wars and fringes about the extremes of workplace laws. However, the Labor Party has continuously promised to fight for fairness and equity at workplace by abolishing Work Choices by putting into operation the Fair Work Bill that will deliver justice at workplace (Forsyth & Stewart, 2009). There are several recommendations to Fair Work Australia. Given the circumstances under which the bill on Fair Work Australia was passed, it is justified to say that the Act can easily be abolished incase the federal government changes. This is because the major parties the Labor Party and the Liberal Party are not in agreement on the issue of fair workplace. The Liberal Party is of the opinion that fair workplace should not be there instead there be Work Choices at workplace, an opinion that is completely opposite of the one held by the Labor Party which support Fair workplace. However, the problem can be solved in the following ways; there is need to educate the general public more so the employers the importance of embracing fair work for their employees such avoiding strikes and demonstrations which are costly to the companies. Secondly, there is need for the government being a commonwealth member to appreciate the role played by the International Labour Organization in order to ensure that employees are protected regardless of the government that is in place (Barnes & Lafferty, 2010). In conclusion, the Fair Work Australia Act has been put in place to ensure fairness, justice and balance in the Australian workplace. From our discussion it was clear that Work Choices has contributed greatly to the instability of workplace relationship and therefore negatively affecting the employment safety net by doing away with many employees’ industrial rights. The Fair Work Bill 2008 appreciates the need to have fairness and balance at workplace by supporting entrepreneurship as one way of ensuring business growth that will translate into economic growth and high standards of living through the creation of employment. Following the introduction of the Fair Work Bill Work Choices is almost gone thereby ushering in a new error of transparency and willingness to ensure justice for the people of Australia. The Act has also stimulated economic reforms, high levels of education, new technologies and globalization that have now created more opportunities for the people of Australia, flexibility, dynamism and responsiveness that could not have been attained by previous generation. Finally, the main challenge to the bill is politics and it is through time that its sustainability can be told (Waring & Cooper, 2009). References Barnes, A & Lafferty, G 2010, ‘The Fair Work Act: As good as it gets?’, The Economic and Labour Relations Review, vol. 21, no. 1, pp. 1-12. Bowden, B 2011, ‘The rise and decline of Australian unionism: A history of industrial labour from the 1820s to 2010’, Labour History, no. 100, pp. 51-82. Bramble, T 2008, Trade unionism in Australia: A history from flood to ebb tide, Cambridge, Cambridge University Press. Bray, M & Macneil, J 2011, ‘Individualism, collectivism, and the case of awards in Australia’, Journal of Industrial Relations, vol. 53, no. 2, pp. 149-167. Cooper, R 2009, The 'New' Industrial Relations and International Economic Crisis: Australia in 2009. Journal of Industrial Relations. Vol. 52, No. 3. pp. 261-274. Cooper, R. & Ellem, B. 2009, 'Fair Work and the Re-regulation of Collective Bargaining', Australian Journal of Labour Law, vol. 22, No. 3, pp. 284-305. Creighton, B & Stewart, A 2010, Labour law, 5th edn, The Federation Press, Sydney. Forsyth, A & Stewart, A 2009, Fair work: The new workplace laws and the work choices legacy, The Federation Press, Sydney. Maconachie, G & Stone, J 2009, Employment relations in Australia, 2nd edn, Milton, John Wiley & Sons Australia. Sappey, R et el 2009, Industrial relations in Australia 2nd ed., Pearson Education, Australia. Waring, P & Cooper, R, 2009, Theory and practice: Employment relations, McGraw-Hill Australia, North Ryde. Read More