Fair Work Amendment (Protecting Take-Home Pay) Bill 2017 [2017] AUSStaCSBSD 106 (29 March 2017)

• Fair Work Amendment (Protecting Take-Home Pay) Bill 2017
• Retrospective application 42

---

Fair Work Amendment (Protecting Take-Home Pay) Bill 2017

Purpose	This bill seeks to amend the Fair Work Act 2009 to ensure that modern awards cannot be varied to reduce penalty rates or the hours to which penalty rates apply if the variation is likely to result in a reduction in the take home pay of an employee
Sponsors	Senators Cameron, Di Natale and Lambie
Introduced	Senate on 21 March 2017

Retrospective application ^[42]

1.57 Proposed section 135A provides that a modern award cannot be varied in a way that would, or would be likely to, reduce the take-home pay of any employee covered by the award. Subsection (3) provides that a determination of the Fair Work Commission made on or after 22 February 2017 is of no effect if it would reduce, or have the effect of reducing, the take-home pay of such employees. This provision therefore will operate retrospectively in relation to any determination that is made after 22 February 2017 but prior to commencement.

1.58 The committee has a long-standing scrutiny concern about provisions that have the effect of applying retrospectively, as it challenges a basic value of the rule of law that, in general, laws should only operate prospectively (not retrospectively). The committee has a particular concern if the legislation will, or might, have a detrimental effect on individuals.

1.59 The committee notes that while the retrospective application of this law could operate beneficially (in relation to employees who may be retrospectively entitled to higher levels of pay), it could also have a detrimental effect on others (employers who may be required to provide back-pay from the date of passage of the bill to the date of any determination). Generally, where proposed legislation will have a retrospective effect the committee expects the explanatory materials should set out the reasons why retrospectivity is sought, and whether any persons are likely to be adversely affected and the extent to which their interests are likely to be affected. In this instance, the explanatory memorandum provides that the amendment will ensure modern awards are a safety net for the take-home pay of employees.^[43] It does not set out whether any person may be detrimentally affected by applying the provisions retrospectively.

1.60 The committee notes that, in general, it considers laws should only operate prospectively (not retrospectively), particularly where legislation may have a detrimental effect on individuals. The committee draws its scrutiny concerns to the attention of Senators and leaves to the Senate as a whole the appropriateness of applying the amendments retrospectively.

The committee draws Senators' attention to the provision, as it may be considered to trespass unduly on personal rights and liberties, in breach of principle 1(a)(i) of the committee's terms of reference.

---

[42] Schedule 1, item 3, proposed subsection 135A(3) of the Fair Work Act 2009.

[43] Explanatory memorandum, p. 3.