Commonwealth of Australia Explanatory Memoranda Commonwealth of Australia Explanatory Memoranda[Index] [Search] [Download] [Bill] [Help]
2010-2011
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
THE SENATE
FAIR WORK AMENDMENT (TEXTILE, CLOTHING AND FOOTWEAR
INDUSTRY) BILL 2011
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Tertiary Education, Skills, Jobs and Workplace
Relations, Senator the Hon Chris Evans)
Outline
FAIR WORK AMENDMENT (TEXTILE, CLOTHING AND FOOTWEAR
INDUSTRY) BILL 2011
OUTLINE
The Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2011 (the Bill) will
amend the Fair Work Act 2009 (FW Act) to enhance existing protections for vulnerable workers
in the textile, clothing and footwear (TCF) industry.
Research has consistently shown that outworkers in the TCF industry suffer from unique
vulnerabilities as a result of their engagement or employment in non-business premises. These
vulnerabilities are often exacerbated by poor English language skills, a lack of knowledge about
the Australian legal system and low levels of union membership in the industry.
Despite the existing provisions in the FW Act, the relevant modern award and in state legislation,
outworkers continue to experience poor working conditions.
This Bill is intended to ensure equitable and consistent protection for these workers.
The Bill will also address a limitation that currently exists in relation to right of entry into
premises in the TCF industry operating under `sweatshop' conditions.
The Bill will:
· extend the operation of most provisions of the FW Act to contract outworkers in the
TCF industry
· provide a mechanism to enable TCF outworkers to recover unpaid amounts up the supply
chain
· extend specific right of entry rules that apply to suspected breaches affecting outworkers
(which allow entry without 24 hours notice) to the industry more broadly , with an exception
for the principal place of business of a person with appropriate accreditation (to which the
standard right of entry rules would apply)
· enable a TCF outwork code to be issued.
These changes will promote fairness and ensure a consistent approach to workplace entitlements
and protections for a class of workers that is widely recognised as being highly vulnerable to
exploitation.
Fair Work Amendment (Textile, Clothing and 1 Senate
Footwear Industry) Bill 2011
Financial Impact Statement
Financial Impact Statement
Nil
Fair Work Amendment (Textile, Clothing and 2 Senate
Footwear Industry) Bill 2011
Notes on Clauses
NOTES ON CLAUSES
In these notes on clauses, the following abbreviations are used:
FW Act Fair Work Act 2009
FWA Fair Work Australia
FWO Fair Work Ombudsman
NES National Employment Standards
TCF textile, clothing and footwear
TCF Award Textile, Clothing, Footwear and Associated Industries Award 2010
the Bill Fair Work Amendment (Textile, Clothing and Footwear Industry)
Bill 2011
Clause 1 - Short title
1. This is a formal provision specifying the short title.
Clause 2 - Commencement
2. The table in this clause sets out when the provisions of the Bill commence.
Clause 3 - Schedule(s)
3. This clause provides that an Act that is specified in a Schedule is amended or repealed
as set out in that Schedule, and any other item in a Schedule operates according to its terms.
Fair Work Amendment (Textile, Clothing and 3 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
Schedule 1 - Amendments
Fair Work Act 2009
Item 1 - At the end of section 4
Item 2 - After subsection 9(5)
Item 3 - At the end of Division 3 of Part 1-1
4. These items amend provisions in Division 3 of Part 1-1 of the FW Act. Division 3
of Part 1-1 (sections 4 to 9) provides a guide to the FW Act. Section 4 contains an overview
of the FW Act. Sections 5 to 9 provide an overview of chapters 2 to 6 of the FW Act.
5. Item 1 inserts new subsection 4(4) that explains that new Schedule 1 to the FW Act
(as inserted by this Bill) contains application, saving and transitional provisions relating to
amendments of the FW Act.
6. Item 2 inserts new subsection 9(5A), which states that new Part 6-4A contains
special provisions about TCF outworkers.
7. Item 3 inserts new section 9A into the Guide in Division 3 of Part 1-1. New
section 9A provides that Schedule 1 contains application, saving and transitional provisions
relating to amendments of the FW Act. The note to this item indicates that application, saving
and transitional provisions relating to the enactment of the FW Act and States becoming
referring States are contained in the Fair Work (Transitional Provisions and Consequential
Amendments) Act 2009.
Item 4 - At the end of section 11
Item 7 - Section 12 (at the end of the definition of employee)
Item 9 - Section 12 (at the end of the definition of employer)
Item 13 - Section 12 (at the end of the definition of national system employee)
Item 15 - Section 12 (at the end of the definition of national system employer)
Item 24 - At the end of section 25
Item 25 - At the end of section 42
Item 26 - At the end of section 60
Item 27 - At the end of section 133
Item 28 - At the end of section 170
Item 30 - At the end of section 259
Item 31 - At the end of section 283
Item 32 - At the end of section 301
Fair Work Amendment (Textile, Clothing and 4 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
Item 33 - At the end of section 308
Item 34 - At the end of section 322
Item 35 - At the end of section 335
Item 36 - At the end of section 380
Item 37 - At the end of section 407
Item 54 - At the end of section 529
Item 55 - At the end of section 538
Item 56 - At the end of section 561
Item 57 - At the end of section 574
Item 58 - At the end of section 680
Item 59 - At the end of section 720
Item 60 - At the end of section 736
Item 62 - At the end of section 791
8. These items insert notes to sections of the FW Act that set out the meaning of
employee for the Parts in which the sections are contained. The new notes refer readers to
Division 2 of new Part 6-4A, which provides that TCF contract outworkers are taken to be
employees for the purposes of most provisions of the FW Act (see item 61).
Item 12 - Section 12 (note at the end of the definition of national system employee)
Item 14 - Section 12 (note at the end of the definition of national system employer)
These items make minor amendments to notes consequential upon the insertion of the new
notes described in paragraph 8.
Item 6 - Section 12
Item 10 - Section 12
Item 11 - Section 12
Item 16 - Section 12
Item 17 - Section 12
Item 18 - Section 12
Item 19 - Section 12
Item 22 - Section 12
Fair Work Amendment (Textile, Clothing and 5 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
9. The amendments made by items 6, 10, 11, 16, 17, 18, 19 and 22 are signpost
definitions - that is, provisions that point readers to definitions included in the substantive
provisions of the FW Act. These definitions are discussed in the relevant parts of this
explanatory memorandum.
Item 5 - Section 12
10. Item 5 inserts a definition of Commonwealth outworker entity. A Commonwealth
outworker entity is an outworker entity otherwise than as extended by sections 30F or 30Q of
the FW Act. Sections 30F and 30Q of the FW Act extend the meaning of outworker entity to
give effect to the referral of powers by state parliaments.
11. The effect of item 5 is that the expression Commonwealth outworker entity means
any of the following entities, other than in their capacity as a national system employer:
· a constitutional corporation
· the Commonwealth
· a Commonwealth authority
· a body corporate incorporated in a Territory
· a person who arranges for work to be performed (directly or indirectly), where the work is
of a kind often performed by outworkers, and the arrangement is connected with a
Territory.
12. A person may be a Commonwealth outworker entity even if they do not directly
engage outworkers. In fact, the expression Commonwealth outworker entity is often used in
the context of describing entities that indirectly arrange for TCF work to be performed by
entering into arrangements with others as part of a supply chain, which ultimately results in
the performance of work by outworkers.
Item 8 - Section 12 (definition of employee record)
13. Item 8 repeals the definition of employee record (which operates by reference to the
definition in the Privacy Act 1988) and substitutes a new definition that reflects the effect of
Division 2 of new Part 6-4A (which provides that TCF contract outworkers are taken to be
employees for the purposes of most provisions of the FW Act (see item 61)).
Item 20 - Section 12 (definition of TCF outworker)
14. Item 20 amends the current definition of TCF outworker to omit the phrase `whose
work is covered by a TCF award'. This amendment relates to the changes to the right of entry
provisions made by the Bill, which include a new concept of TCF award worker. These
changes mean that a reference to a TCF award in the definition of TCF outworker is no
longer necessary.
Item 21 - Section 12
15. Item 21 inserts a new definition of TCF work, which is defined to mean work in the
textile, clothing or footwear industry.
Fair Work Amendment (Textile, Clothing and 6 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
Item 23 - After section 17
16. This item inserts new section 17A, which outlines the manner in which the
expressions directly and indirectly are used in relation to TCF work.
17. In relation to a chain or series of two or more arrangements for the supply or
production of goods produced by a person performing TCF work:
· the work is taken to be performed directly for the person who employed or engaged the
worker. That person is also, under this item, taken to have arranged for the work to be
performed directly for the person
· the work is taken to be performed indirectly for every other person who is a party to an
arrangement in the chain or series, each of whom is also, under this item, taken to have
arranged for the work to be performed indirectly.
18. The effect of the item is that, in circumstances where there is a chain or series of
two or more arrangements for the supply or production of goods produced by TCF work, a
person performs work directly for the person who employs or engages the person to perform
work. A person performs work indirectly for every other person who is a party to any of the
arrangements in the chain or series of arrangements that led to the performance of the work
(whether that person is one, two or more arrangements removed from the performance of the
work).
Item 29 - After subsection 203(2)
19. Modern awards can, where appropriate, include outworker terms that apply to both
employees and contract outworkers (section 140 of the FW Act). This allows the TCF Award
to include terms that enable monitoring of the supply chain, such as registration and record
keeping.
20. Section 200 of the FW Act ensures that enterprise agreements cannot undercut
outworker terms.
21. Section 203 of the FW Act sets out the requirements to be met by a flexibility term
in an enterprise agreement.
22. Item 29 inserts new subsection 203(2A) to provide further protection of outworker
terms. The new provision relates to the content of a flexibility term in an enterprise
agreement. New subsection 203(2A) provides that if an enterprise agreement includes terms
that would be outworker terms if they were included in a modern award, the flexibility term
must not allow the effect of the outworker terms to be varied.
RIGHT OF ENTRY
23. Items 38-53 make amendments to the right of entry provisions of the FW Act. These
amendments are designed to enable effective entry rights in relation to sweatshop premises in
the TCF industry.
24. The amendments will ensure that permit holders who are entitled to represent
workers in the TCF industry have additional entry rights to enter business premises. This is
necessary to ensure effective entry rights to business premises operating under sweatshop
Fair Work Amendment (Textile, Clothing and 7 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
conditions, as the existing requirement to give at least 24 hours notice of entry to such
premises could limit the effectiveness of these rights.
25. Under the FW Act, specific rules apply to union entry to investigate suspected
contraventions relating to TCF outworkers (subdivision AA of Division 2 to Part 3-4). These
rules allow a permit holder to enter premises without giving 24 hours notice for the purposes
of investigating a suspected contravention of:
· the FW Act or a term of a fair work instrument that relates to or affects an outworker
whose industrial interests the permit holder's organisation is entitled to represent and who
performs work on the premises (paragraph 483A(1)(a) of the FW Act)
· a designated outworker term that is in an instrument that relates to TCF outworkers whose
industrial interests the permit holder's organisation is entitled to represent
(paragraph 483A(1)(b) of the FW Act).
26. These amendments will broaden the entry rules in paragraph 483A(1)(a) of the
FW Act. At present, this provision is limited to entry relating to outworkers (that is, those
who perform work at residential premises or other premises not conventionally regarded as
business premises). These amendments would extend the existing right to enter without
notice in paragraph 483A(1)(a) to breaches relating to TCF award workers.
Item 40 - Subdivision AA of Division 2 of Part 3-4 (heading)
Item 41 - Section 483A (heading)
27. These items repeal and substitute the headings of Subdivision AA of Division 2 of
Part 3-4 of the FW Act and of section 483A of the FW Act, to reflect the extension of entry
rights in the TCF industry.
Item 38 - Section 478
Item 39 - Paragraph 480(b)
Item 43 - Paragraph 483A(1)(a)
Item 44 - Paragraph 483A(1)(b)
Item 45 - After subsection 483A(1)
Item 48 - Subparagraphs 483B(3)(a)(ii) and (iii)
Item 49 - Section 484
Item 50 - Paragraph 518(2)(ca)
Item 51 - Paragraph 518(2)(cb)
Item 52 - Paragraphs 518(2)(cc) and (d)
Item 53 - Paragraphs 518(3)(b) and (c)
Fair Work Amendment (Textile, Clothing and 8 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
28. Item 45 inserts a new definition of TCF award worker.
29. The definition of TCF award worker covers employees whose work is covered by a
TCF award, or individuals who, for the purpose of a contract for the provision of services,
perform work that is covered by a TCF award.
30. The amendments made by items 38, 39, 43, 44 and 48 to 53 substitute references in
Part 3-4 to TCF outworker with references to the broader TCF award worker.
31. The effect of these amendments is to extend the scope of the TCF specific right of
entry rules in relation to suspected breaches of the FW Act and fair work instruments under
paragraph 483A(1)(a) (which allow entry without the requirement to provide 24 hours notice)
for breaches that relate to or affect an outworker to breaches that relate to or affect a TCF
award worker.
32. Although the expression TCF outworker is replaced with TCF award worker in
paragraph 483A(1)(b), this does not have the effect of changing the scope of that provision,
as entry remains related to breaches of designated outworker terms - which is a term defined
in section 12 of the FW Act (and regulation 1.04 of the Fair Work Regulations 2009). A
designated outworker term is a term of a modern award, enterprise agreement, workplace
determination or other instrument about one of a specified range of matters that relates to
outworkers in the TCF industry.
Item 42 - Subsection 483A(1)
Item 46 - At the end of section 483A
33. Item 46 inserts new subsections 483A(6) and (7). These provisions provide an
exception to the new entry rules that applies to accredited premises.
34. New subsection 483A(6) provides that the new entry rules in paragraph 483A(1)(a)
do not apply to particular premises of a person if:
· the person is accredited by a prescribed person or body
· the accreditation is in writing and in force
· the premises are identified in the accreditation as the principal place of business of the
accredited person.
35. The note to this provision makes clear that:
· if the new entry rules do not apply, the `standard' entry rules in Subdivision A apply
instead
· new subsection 483A(6) does not affect entry rights in relation to designated outworker
terms under paragraph 483A(1)(b).
36. New subsection 483A(7) provides that before regulations can be made under new
subsection 483A(6) specifying a particular person or body, the Minister must be satisfied that
the person or body:
Fair Work Amendment (Textile, Clothing and 9 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
· has aims consistent with the objects of the new provisions in Part 6-4A, which are
directed at eliminating exploitation of TCF outworkers; and
· has the endorsement of at least one employee organisation and at least one employer
organisation that are entitled to represent the industrial interests of TCF award workers or
of persons who employ or engage TCF award workers.
37. Item 42 makes an amendment to subsection 483A(1) of the FW Act that is
consequential upon the insertion of new subsection 483A(6) by item 46.
Item 47 - Subparagraph 483B(3)(a)(i)
38. This item makes a technical change to section 483B of the FW Act.
Subparagraph 483B(3)(a)(i) currently refers to a person who `employs' a TCF outworker. As
the workers to which this provision relates (now extended to TCF award workers) can be
employees or contractors, this amendment changes the reference to `employs' to `employs or
engages'.
IMPROVED PROTECTION FOR TCF OUTWORKERS
Item 61 - After Part 6-4
39. This item inserts new Part 6-4A into the FW Act to make special provisions about
TCF outworkers.
40. Part 6-4A includes a range of measures to address the unique vulnerabilities of
outworkers in the TCF industry. The new part addresses these issues by:
· extending the operation of most provisions of the FW Act to contract outworkers in the
TCF industry (Division 2 of new Part 6-4A)
· providing a mechanism to enable outworkers to recover amounts owing up the supply
chain (Division 3 of new Part 6-4A)
· enabling regulations to be made prescribing a TCF outwork code (Division 4 of new
Part 6-4A).
41. These amendments will provide consistent workplace rights and protections for
workers in the TCF industry regardless of whether they are employees or contractors, and
provide enhanced enforcement of unpaid entitlements and monitoring of supply chain
arrangements.
New Division 1 - Introduction
New section 789AA - Guide to this Part
42. New section 789AA provides a guide to Part 6-4A.
Fair Work Amendment (Textile, Clothing and 10 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
New section 789AB - Meanings of employee and employer
43. In this Part, the terms employee and employer have their ordinary meanings and are
not limited to national system employees and employers (see sections 13 and 14 of the
FW Act).
New section 789AC - Objects of this Part
44. New section 789AC sets out the objects of Part 6-4A. The objects are to eliminate
the exploitation of TCF outworkers and ensure that outworkers are employed or engaged
under secure, safe and fair systems of work, by:
· providing nationally consistent rights and protections for those outworkers, regardless of
whether they are employees or contractors
· establishing an effective mechanism for recovery of unpaid amounts from other parties in
the supply chain
· providing for a code dealing with standards of conduct and practice to be complied with
by parties in the supply chain.
Extension of FW Act to contract outworkers
New Division 2 - TCF contract outworkers taken to be employees in certain circumstances
New section 789BA - Provisions covered by this Division
45. Division 2 of new Part 6-4A makes provision for TCF contract outworkers to be
treated as employees for the purposes of the FW Act. New section 789BA provides that
Division 2 applies to the provisions of the FW Act, subject to limited exceptions
(paragraphs 789BA(1)(a) - (g)). These are:
· the right of entry provisions (in respect of which separate amendments are being made)
· the stand down provisions (which are dealt with comprehensively in the relevant
TCF Award)
· the provisions which provide for the extended operation of the FW Act, or parts of it
· the provisions giving effect to the extension itself and associated savings, application and
transitional arrangements.
46. New subsections 789BA(2) and 789BA(3) set out the manner in which the
provisions of the FW Act that are affected by the amendments contained in new Division 2
are to be read together with the provisions that are not affected, and vice versa.
New section 789BB - TCF contract outworkers taken to be employees in certain
circumstances
47. New section 789BB extends provisions of the FW Act that currently apply to
employees and employers to TCF contract outworkers and entities that engage them.
Fair Work Amendment (Textile, Clothing and 11 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
48. This provision is intended to ensure that TCF contract outworkers have the same
entitlements and protections under the FW Act as TCF employee outworkers.
49. New subsection 789BB(2) defines TCF contract outworker as a TCF outworker
who performs work for the purposes of a contract for the provision of services other than as
an employee (noting that employees are already covered by the FW Act).
50. New paragraph 789BB(1)(a) provides that, where particular TCF work is performed
directly or indirectly for a Commonwealth outworker entity for the purposes of the FW Act,
the TCF contract outworker who performs the work will be taken to be an employee (within
the ordinary meaning of that expression) and to be a national system employee.
51. Where the work performed by the TCF contract outworker is arranged directly or
indirectly by a Commonwealth outworker entity that is a constitutional corporation, the
TCF work must be performed for the purposes of a business undertaking of the corporation
(new subparagraph 789BB(1)(a)(ii)).
52. The expressions directly and indirectly are explained in new section 17A. As the
provision extends to work arranged indirectly, TCF contract outworkers engaged at the end of
a series of arrangements are taken to be employees provided the requirements of new
paragraph 789BB(1)(a) are met.
53. New paragraph 789BB(1)(b) provides that the person that engages such an
outworker is taken to be the employer (within the ordinary meaning of the expression) and to
be a national system employer of the outworker in relation to the TCF work for the purposes
of the FW Act. This provision applies to the person taken to be the employer whether or not
the person is a Commonwealth outworker entity or another person.
54. The objective of new section 789BB is set out in new subsection 789BB(4). The
objective is that a TCF contract outworker who is taken to be an employee under this section
should have the same rights and obligations in relation to the work as an employee would
have in the same circumstances.
55. New subsection 789BB(3) provides guidance for interpreting the FW Act or any
instrument that is relevant to the relationship between the TCF contract outworker and the
person taken to be their employer under new section 789BB (for example, in interpreting the
operation of the provisions of the relevant modern award). The new subsection provides that
an interpretation of these instruments that is consistent with the objective set out in new
subsection 789BB(4) is to be preferred to an interpretation that is not consistent with that
objective.
56. New subsection 789BB(5) states that new section 789BB has effect subject to any
regulations made under new section 789BC (regulations under new section 789BC may be
made for the purpose of furthering the objective contained in new subsection 789BB(4)).
New section 789BC - Regulations relating to TCF outworkers who are taken to be employees
57. The regulation making power in new section 789BC is intended to enable the
operation of provisions of the FW Act to be clarified or modified should this prove necessary
to ensure the effective implementation of the objective of TCF contract outworkers having
the same rights as employees. The reference to furthering the objective is designed to make
Fair Work Amendment (Textile, Clothing and 12 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
clear that while regulations might be made to address technical issues if they arise,
regulations cannot be made to undercut the effectiveness of the extension of the FW Act to
TCF contract outworkers.
58. New subsection 789BC(1) allows regulations to be made for the purpose of
furthering the objective of TCF contract outworkers having the same rights and obligations in
relation to the work as employees. These regulations may:
· provide that provisions covered by this Division apply in relation to deemed employees
and deemed employers with specified modifications
· otherwise make provision relating to how provisions covered by this Division apply in
relation to TCF contract outworkers and the person taken to be their employer under new
section 789BB.
59. New subsection 789BC(2) allows for the regulations made under new
subsection 789BC(1) to provide differently for the purposes of different provisions of the
FW Act or in relation to different situations.
60. However, new subsection 789BC(3) makes clear that regulations may not be made
to modify provisions dealing with offences or to create new offences.
Recovery of unpaid amounts
New Division 3 - Recovery of unpaid amounts
61. New Division 3 will provide TCF outworkers with a mechanism to recover an unpaid
amount from an indirectly responsible entity further up the supply chain in circumstances
where the person who is responsible for doing so has not paid the outworker.
62. A TCF outworker may recover the unpaid amount if the TCF work was performed
indirectly for a Commonwealth outworker entity and, if the entity is a constitutional
corporation, for the purposes of a business undertaking of that corporation.
63. As long as the entity is in a chain or series of arrangements for the supply or
production of the goods and the relevant TCF work has the requisite connection to the
Commonwealth outworker entity, the entity will be an indirectly responsible entity. There can
be more than one indirectly responsible entity in relation to a particular unpaid amount.
· The circumstances in which work is considered to have been performed indirectly for a
person are set out in new section 17A (outlined earlier in this explanatory memorandum).
The concept of a Commonwealth outworker entity is explained in paragraphs 10 to 12 of
this explanatory memorandum.
64. The primary liability to pay the TCF outworker remains with the person (the
responsible person) who employed or engaged them. However, if the TCF outworker has
taken reasonable steps to recover the unpaid amount from that person without success, they
may initiate proceedings in reliance on these new provisions.
65. If the indirectly responsible entity pays the unpaid amount, that entity will be able to
recover an equivalent amount, plus interest, from the responsible person, whether by way of
Fair Work Amendment (Textile, Clothing and 13 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
offset or proceedings in the Federal Court, Federal Magistrate's Court or eligible state or
territory court.
66. To the extent that the Commonwealth outworker entity is a retailer that sells goods
produced by the outworker's work but the retailer did not have the right to supervise or
otherwise control the performance of work before the goods are delivered to the entity, that
entity will not be an indirectly responsible entity for the purposes of these provisions.
New Section 789CA - When this Division applies
67. New subsection 789CA(1) sets out when the Division will apply. The Division will
apply to a TCF outworker who performs TCF work for a person. The person for whom the
TCF outworker performs the work is defined as the responsible person.
68. New subsection 789CA(1) provides that the Division will apply if there is one or
more indirectly responsible entity in relation to the TCF work, the responsible person has not
paid the outworker (or another person for the benefit of the outworker) by the time the
amount is due, and the amount is payable under:
· a contract
· the FW Act, or an instrument made under or in accordance with the FW Act
· another Commonwealth law (for example, superannuation legislation)
· a transitional instrument
· a State or territory industrial law or a State industrial instrument.
69. New subsection 789CA(2) specifies that subject to new paragraph 789CA(1)(c) and
without limiting new paragraph 789CA(1)(b), an unpaid amount may include:
· an amount payable by way of remuneration or commission
· an amount payable in respect of leave (for example, an amount owing in respect of
untaken accrued annual leave)
· an amount payable by way of contributions to a superannuation fund
· an amount payable by way of reimbursement for expenses incurred.
70. New subsection 789CA(3) defines indirectly responsible entity as the entity that will
be responsible for payment of the unpaid amount owing to the TCF outworker as a result of
new subsection 789CA(1). An entity will be an indirectly responsible entity in relation to
TCF work if the entity is a Commonwealth outworker entity and the work was performed
indirectly for the entity and, if that entity is a constitutional corporation, the work was
performed for the purposes of a business undertaking of that corporation.
71. The note directs the reader to new section 17A, which explains the circumstances in
which work is considered to have been performed indirectly for a person as part of a chain or
series of arrangements for the supply or production of goods. The effect of this is that an
entity further up the supply chain (whether one, two or more arrangements removed from the
Fair Work Amendment (Textile, Clothing and 14 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
performance of the work) will be an indirectly responsible entity, subject to the other
requirements being met.
72. New subsection 789CA(4) makes clear that an entity is only an indirectly responsible
entity in relation to TCF work performed indirectly for the entity and not in relation to other
TCF work performed by the outworker.
73. New subsection 789CA(5) provides that a Commonwealth outworker entity which, as
a retailer, sells goods produced by the TCF work but in circumstances where the retailer did
not have any right to supervise or otherwise control the performance of work before the
goods are delivered to the entity is not an indirectly responsible entity.
New Section 789CB-Liability of indirectly responsible entity for unpaid amount
74. New subsection 789CB(1) provides that each indirectly responsible entity (or the
indirectly responsible entity, if there is only one) is liable to pay the unpaid amount to the
TCF outworker.
75. However, new subsection 789CB(2) provides that the indirectly responsible entity is
not liable to pay the unpaid amount to the TCF outworker unless the outworker has taken
reasonable steps to recover the unpaid amount from the responsible person. Whether steps
taken will be considered reasonable will depend on the particular circumstances, including
the circumstances of the TCF outworker (including language or other difficulties they may
face) and whether there are any difficulties in locating the responsible entity.
76. New subsection 789CB(3) provides that if there is more than one indirectly
responsible entity in a chain or series of arrangements, each of those entities is jointly and
severally liable for the payment of the unpaid amount. This ensures that an indirectly
responsible entity in the chain is not able to escape liability by establishing that there are
other indirectly responsible entities from whom payment of the unpaid amount could also
have been sought under this Division.
77. New subsection 789CB(4) ensures that the capacity to recover money from an
indirectly responsible entity does not affect the liability of the responsible person to pay the
unpaid amount. This ensures that the responsible person retains the primary obligation to pay
the unpaid amount.
78. However, new subsection 789CB(5) provides that payment of the unpaid amount (or a
part of that amount) by an indirectly responsible entity discharges the liability of the
responsible person, to the extent of the payment. The amendment does not affect any right
that the indirectly responsible entity has to recover an equivalent amount from the responsible
person or another person or to be otherwise indemnified.
79. A note to this section alerts readers to the fact that the indirectly responsible entity has
a right to recover an equivalent amount from the responsible person under new
section 789CE.
Fair Work Amendment (Textile, Clothing and 15 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
New section 789CC - Demand for payment from an indirectly responsible entity
80. Under new subsection 789CC(1), the TCF outworker, or a person acting on their
behalf, may give an indirectly responsible entity a written demand for payment of the unpaid
amount if, under new section 789CB, the entity is liable to pay the unpaid amount.
81. New subsection 789CC(2) sets out the particulars the demand must contain.
82. New subsection 789CC(3) provides that the time specified by which the amount must
be paid must be no less than 14 days after the demand is given to the indirectly responsible
entity.
New section 789CD - Proceedings against indirectly responsible entity for payment of unpaid
amount
83. Under new subsection 789CD(1), proceedings may be commenced seeking an order
requiring an indirectly responsible entity to pay the unpaid amount if the entity has been
given a demand for payment (in accordance with new section 789CC) and the unpaid amount
has not been paid in full by the time specified in the demand.
84. New subsection 789CD(2) provides that the proceedings may be commenced by the
TCF outworker, on the TCF outworker's behalf by an organisation that is entitled to represent
the industrial interests of the outworker, or by a Fair Work Inspector.
85. Under new subsection 789CD(3) proceedings may be commenced in the Federal
Court, the Federal Magistrates Court or an eligible state or territory court. The conferral of
jurisdiction on these courts is consistent with the conferral of jurisdiction in respect of unpaid
wages and entitlements in the FW Act more generally.
86. New subsection 789CD(4) provides that if the court is satisfied that the unpaid
amount is, or is to an extent, still owing and the entity against which the proceedings have
been commenced is an indirectly responsible entity for the purposes of new section 789CB,
the court may make an order requiring the entity to pay the unpaid amount (or as much of the
amount as remains owing) to the TCF outworker, or to another person on the outworker's
behalf. These amendments ensure the court has power to award the payment of an unpaid
amount to not only the outworker himself or herself, but to another entity, such as a
superannuation fund, if appropriate.
87. New subsections 789CD(5) and (6) provide for the inclusion of an amount of interest
in making an order under new subsection 789CD(4). The court must, on application, include
an amount of interest in the sum owing, unless good cause is shown to the contrary, to ensure
that the TCF outworker is not penalised for any delay in payment but is restored to the
position they would have been in had the amount been paid on time.
88. Under new subsection 789CD(7) the limitation period for the commencement of
proceedings is 6 years after the time when the unpaid amount becomes due for payment by
the responsible person.
Fair Work Amendment (Textile, Clothing and 16 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
New section 789CE - Indirectly responsible entity may recover from responsible person
89. Under new section 789CE, an indirectly responsible entity may recover the unpaid
amount from the responsible person. New subsection 789CE(1) provides that this right of
recovery applies whether or not the payment by the indirectly responsible entity was made as
a result of an order by the court under new section 789CD.
90. New subsections 789CE(2) and 789CE(3) provide that the indirectly responsible
entity may recover from the responsible person an amount (the recoverable amount)
equivalent to the unpaid amount and any interest paid. The entity may recover the
recoverable amount by offsetting it against any amount that the entity owes to the responsible
person or by taking court proceedings against the responsible person (new
subsection 789CE(4)).
91. Under new subsection 789CE(4), the entity may commence proceedings against the
responsible person for the recoverable amount in the Federal Court, the Federal Magistrates
Court or an eligible state or territory court.
92. Under new subsection 789CE(5), the court may make an order requiring the
responsible person to pay the entity the recoverable amount (or as much of it as remains
owing).
93. New subsection 789CE(6) provides for the court to make an order for the payment of
interest on the recoverable amount, calculated from the time when the indirectly responsible
entity paid the unpaid amount (new subsection 789CE(7)).
94. Under new subsection 789CE(8) the limitation period for the commencement of
proceedings is 6 years after the time when the unpaid amount becomes due for payment by
the responsible person.
New section 789CF - Division does not limit other liabilities or rights
95. New section 789CF provides that nothing in these amendments limits any other
liability or right in respect of the entitlement of the TFC outworker to the unpaid amount, for
example under a state law that provides for recovery of unpaid amounts up the supply chain.
TCF outwork code
New Division 4- Code of practice relating to TCF outwork
New section 789DA-Regulations may provide for a code
96. New section 789DA provides that the regulations may prescribe a code (the
TCF outwork code) for the purpose of furthering the objects of the Part.
· The objects of the Part as set out in new section 789AC are to eliminate the exploitation
of outworkers in the TCF industry and to ensure that those outworkers are employed or
engaged under secure, safe and fair systems of work.
97. The regulations prescribing a TCF outwork code may deal with standards of conduct
and practice to be complied with in relation to the employment or engagement of
Fair Work Amendment (Textile, Clothing and 17 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
TCF outworkers, the arranging for TCF work to be performed or the sale of goods produced
by TCF work.
98. The notes to new section 789DA remind readers that:
· subject to new section 789DC, in situations where the supply or production of goods
occurs by way of a chain or series of arrangements, the TCF outwork code may impose
obligations on any persons that are parties to arrangements in that chain or series of
arrangements, and not just on those who directly employ or engage TCF outworkers for
the work to be done.
· References in other provisions to `this Act' will include the code, as the definition of `this
Act' in section 12 of the FW Act includes the regulations. This will enable (for example)
Fair Work Inspectors to exercise their powers under the FW Act in relation to the code.
New section 789DB - Matters that may be dealt with in TCF outwork code
99. New subsection 789DB(1) sets out the matters that may be dealt with in the
TCF outwork code. The matters that may be dealt with include (but are not limited to):
· record keeping requirements
· reporting on compliance with record keeping requirements or on compliance with other
requirements of the code
· general matters relating to the operation and administration of the code.
100. These matters are consistent with the types of matters that are currently dealt with in
the relevant modern award, in state outworker codes of practice as well as in the obligations
on manufacturers accredited with Ethical Clothing Australia.
101. New subsection 789DB(2) provides that the TCF outwork code must not specify
wages or other entitlements for TCF outworkers, as it is not the purpose of the code to deal
with such matters.
New section 789DC - Persons on whom obligations may be imposed by TCF outwork code
102. New subsection 789DC(1) provides that the TCF outwork code may only impose
obligations on a person if one or more of new subsections 789DC(2) to 789DC(5) apply to
the person.
103. The note to new subsection 789DC(1) refers to new subsection 789DC(6), which
identifies the matters in relation to which obligations may be imposed.
104. New subsection 789DC(2) deals with the situation where a person is a national system
employer that employs TCF outworkers.
105. The note to new subsection 789DC(2) reminds readers that the effect of Division 2 of
Part 6-4A (which provides that TCF contract outworkers are taken to be employees in certain
circumstances) must be taken into account for the purposes of the subsection.
Fair Work Amendment (Textile, Clothing and 18 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
106. New subsection 789DC(3) deals with the situation where a person is a
Commonwealth outworker entity that has arranged for TCF work to be performed directly or
indirectly. A note to this subsection refers to new section 17A, which outlines the
circumstances in which TCF work is performed directly or indirectly for a person.
107. New subsection 789DC(4) deals with the situation where a person who is not a
Commonwealth outworker entity arranges for TCF work to be performed indirectly for a
Commonwealth outworker entity.
108. New subsection 789DC(5) provides that the subsection applies to a person if the
person is a constitutional corporation that sells goods produced by TCF work.
109. New subsection 789DC(6) identifies the matters in relation to which obligations may
be imposed on the persons identified in each of subsections 789DC(2) to 789DC(5).
Obligations may be imposed in relation to:
· a person's employment of TCF outworkers (in the case of subsection (2))
· TCF work (or arrangements for TCF work) (in the case of subsections (3) and (4))
· the person as a seller of relevant goods (in the case of subsection (5)).
New section 789DD - Other general matters relating to content of TCF outwork code
110. New subsection 789DD(1) provides that the TCF outwork code may be expressed to
apply in relation to all persons covered by new section 789DC or specified classes of those
persons, and to all TCF work or specified classes of TCF work. A note to the subsection
makes clear that a class of person or TCF work may be identified (for example) by reference
to a particular sector of the TCF industry.
111. New subsection 789DD(2) provides that the TCF outwork code may provide
differently for differently classes of persons covered by new section 789DC or different
classes of TCF work or different situations. This ensures that the TCF outwork code can
contain targeted provisions if necessary or appropriate.
New section 789DE - Relationship between the TCF outwork code and other instruments
112. New subsection 789DE(1) provides that a TCF award prevails over the TCF outwork
code, to the extent of any inconsistency. This amendment ensures that in the hierarchy of
subordinate legislation to which the code and the award belong, the award prevails. This
ensures that terms developed by the independent industrial body will remain the benchmark
for any new arrangements.
113. On the other hand, new subsection 789DE(2) makes clear that the TCF outwork code
prevails over an enterprise agreement, a workplace determination or an agreement-based
transitional instrument as continued in existence by Schedule 3 to the Fair Work
(Transitional Provisions and Consequential Amendments) Act 2009, to the extent of any
inconsistency.
114. New subsections 789DE(3) and 789DE(4) provide that the TCF outwork code may
apply, adopt or incorporate any matter contained in an instrument or other writing as in force
from time to time, or make provision to the effect that compliance with a specified term of an
Fair Work Amendment (Textile, Clothing and 19 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
instrument or other writing as in force or existing from time to time is taken to satisfy a
particular requirement of the code. The kinds of instruments or other writing by reference to
which the TCF outwork code may make provision include, but are not limited to the
TCF Award or a code dealing with matters relating to outworkers that is made under a law of
a state or territory.
115. The capacity to incorporate terms as they exist from time to time by reference is an
exception to subsection 14(2) of the Legislative Instruments Act 2003 (new
subsection 789DE(6)). This is designed to enable maximum flexibility in the way in which
the code is designed, given the extent to which multiple arrangements already operate in this
area.
· Mandatory codes of practice for the TCF industry have been declared in New South
Wales, Queensland and South Australia. A voluntary code of practice also exists at the
federal level.
116. These amendments will enable, for example, obligations in a state code of practice or
another instrument to be incorporated by reference into a new TCF outwork code, allowing
the code to limit the extent to which a person will need to comply with multiple obligations
directed to the same end as a result of the operation of a new TCF outwork code.
117. New subsection 789DE(5) makes clear that the TCF outwork code cannot apply,
adopt or incorporate a matter contained in any instrument or other writing under new
subsection 789DE(3) by reference to an enterprise agreement, a workplace determination or
an agreement-based transitional instrument as continued in existence by Schedule 3 to the
Fair Work (Transitional Provisions and Consequential Amendments) Act 2009. These
instruments are generally workplace specific and are not appropriate for incorporation into a
code of general operation.
Miscellaneous
New Division 5 - Miscellaneous
New section 789EA - Part not intended to exclude or limit State or Territory laws relating to
outworkers
118. New subsection 789EA(1) provides that new Part 6-4A is not intended to exclude or
limit the operation of a law of a State or Territory (or an instrument made under a law of a
State or Territory) to the extent that the law (or instrument) relates to outworkers and is
capable of operating concurrently with this Part.
119. The new section makes clear that where state and territory laws dealing with the
employment of engagement of outworkers are not directly inconsistent with the FW Act as
amended by this Bill they will continue to apply.
120. New subsection 789EA(2) states that a reference in new subsection 789EA(1) to
this Part includes a reference to any regulations made for the purposes of this Part.
Item 63 - After section 795
121. This item inserts new section 795A which provides that new Schedule 1 (which
provides application, saving and transitional provisions) has effect.
Fair Work Amendment (Textile, Clothing and 20 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
Item 64 - At the end of the Act
122. Item 64 inserts new Schedule 1 dealing with application, saving and transitional
provisions relating to amendments of the FW Act.
123. The amendments to the FW Act will, to some extent, be supported by referrals of
power from a number of State Parliaments (the amendments relating to right of entry). As the
state referrals only gave the Commonwealth power to deal with matters by express
amendment of the FW Act, there are some application, saving and transitional matters that
can only be dealt with by amending the FW Act. In the interests of all application, saving and
transitional provisions for amendment of the FW Act being located in the same place
(whether or not they need to rely on the State reference) a new Schedule 1 is being added at
the end of the FW Act as a repository for all application, saving and transitional provisions
relating to these amendments and future amending Bills.
New clause 1 - Definitions
124. This clause defines terms used in new Part 1 of Schedule 1 to the FW Act, which
are:
· amended Act
· amending Act
· commencement
· deemed employee
· deemed employer.
New clause 2 - Section 789BB of amended Act applies to contracts entered into after
commencement
125. New subclause 2(1) provides that new section 789BB of the FW Act as amended,
which provides that TCF contract outworkers are taken to be employees in certain
circumstances, applies only in relation to TCF work performed by a TCF contract outworker
where the contract for the provision of services under which the TCF work was performed
was entered into after the commencement of new Part 1 of Schedule 1 to the FW Act.
126. New subclause 2(2) makes clear that new subclause 2(1) does not prevent
regulations from being made, under either new section 789BC of the FW Act as amended or
new clause 7 of the Part, that deal with the effect of matters that occurred prior to the
commencement of new Part 1 of Schedule 1 to the FW Act in relation to a person taken by
new section 789BB to be an employee.
New clause 3- Effect on TCF contract outworker's entitlements
127. New subclause 3(1) provides that entitlements accrued by a TCF contract outworker
prior to the commencement of new Part 1 of Schedule 1 will not be affected by the
amendments in this Bill.
Fair Work Amendment (Textile, Clothing and 21 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
128. New subclause 3(2) addresses a situation that may arise where the NES is to be
applied to a TCF contract outworker as though the outworker is an employee because of a
term of a modern award, and that TCF contract outworker is taken to be an employee due to
the operation of Division 2 of Part 6-4A of the FW Act. In that situation, to the extent that the
entitlement derived from the term of the award is the same as the NES entitlement, the term
operates in parallel to (rather than in addition to) the outworker's NES entitlement.
129. The provision ensures, for the avoidance of doubt, that the outworker does not
receive a double benefit as a result of these amendments.
New clause 4 - Fair work instruments etc. made before commencement
130. New clause 4 makes clear that a reference to an employee or employer contained in
a fair work instrument made before the commencement of new Part 1 of Schedule 1 to the
FW Act, or in a transitional instrument that is still in operation because of the effect of
Schedule 3 to the Fair Work (Transitional Provisions and Consequential Amendments) Act
2009, will not be taken to include a deemed employee or deemed employer unless the
instrument is specifically varied to do so.
131. New subclause 4(3) makes clear that new subclause 4(2) does not confer a power to
vary a fair work instrument. Variation may occur in accordance with relevant provisions of
the FW Act or the Fair Work (Transitional Provisions and Consequential Amendments) Act
2009.
New clause 5- Application of Division 3 of Part 6-4A of amended Act
132. This clause relates to parties to an arrangement for TCF work entered into before
the commencement of new Part 1 of Schedule 1 to the FW Act.
133. The clause provides that, for the purposes of Division 3 of Part 6-4 of the FW Act
(which provides for the recovery of unpaid amounts), an entity will not be treated as an
indirectly responsible entity if the arrangement for the TCF work was entered into before the
commencement of these amendments.
New clause 6- Application of subsection 203(2A) of amended Act
134. This clause makes clear that subsection 203(2A) of the FW Act as amended applies
in relation to enterprise agreements made after the commencement of new Part 1 of
Schedule 1 to the FW Act.
New clause 7 - Regulations dealing with various matters
135. This clause provides for regulation making powers under new subclause 7(1) and
new subclause 7(3).
136. New subclause 7(1) allows regulations to be made in relation to matters of an
application, saving or transitional nature relating to the amendments to the FW Act, and new
subclause 7(2) makes clear that the new Part 1 of Schedule 1 to the FW Act operates subject
to any regulations made under new subclause 7(1).
Fair Work Amendment (Textile, Clothing and 22 Senate
Footwear Industry) Bill 2011
Amendments ~ Schedule 1
137. New subclause 7(3) allows regulations to be made in relation to how the Fair Work
(Transitional Provisions and Consequential Amendments) Act 2009 applies in relation to
TCF outworkers.
138. New subclause 7(4) provides that, without limiting new subclause 7(3), regulations
may provide that the Fair Work (Transitional Provisions and Consequential Amendments)
Act 2009 applies with specified modifications or otherwise make provision relating to how
provisions of that Act apply.
139. New subclause 7(5) makes clear that regulations made for the purposes of new
subclause 7(1) or new subclause 7(3) may be expressed to take effect from a date before the
regulations are registered under the Legislative Instruments Act 2003. This is designed to
ensure that, should it prove necessary to deal with transitional issues arising after
commencement of the amendments, the regulations are able to do so seamlessly and in a
manner that does not disadvantage TCF outworkers.
Fair Work Amendment (Textile, Clothing and 23 Senate
Footwear Industry) Bill 2011