Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 - Commentary on Ministerial Responses [2023] AUSStaCSBSD 24 (8 February 2023)

• Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022
• Broad delegation of administrative functions and powers31
• Immunity from civil liability35
• Fees in delegated legislation39
• Broad discretionary power
• Significant matters in delegated legislation43
• Legislative instrument not subject to disallowance47

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Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022

Purpose	This bill seeks to amend the Fair Work Act 2009 and related legislation to improve the workplace relations framework.
Portfolio	Employment and Workplace Relations
Introduced	House of Representatives on 27 October 2022
Bill status	Passed both Houses

Broad delegation of administrative functions and powers^[31]

2.66 Item 222 of Part 3 of Schedule 1 to the bill seeks to insert proposed paragraph 40(1)(ba) into existing section 40 of the Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act). Section 40 currently allows the Federal Safety Commissioner (FSC) to delegate all or any of their powers and functions to Federal Safety Officers, members of the Senior Executive Service (SES) or a person prescribed by the rules. Proposed paragraph 40(1)(ba) provides that the FSC may also delegate all or any of their powers and functions to an APS employee whose duties relate to the powers and functions of the FSC. The committee notes that the FSC's role has a number of regulatory and administrative functions, including administering the Accreditation Workplace Health and Safety Scheme.^[32]

2.67 In Scrutiny Digest 7 of 2022 the committee requested the minister's advice as to whether the bill can be amended to:

• provide some legislative guidance as to the scope of powers that might be delegated, or the categories of people to whom those powers might be delegated; or

• at a minimum, require that the Federal Safety Commissioner, when making a delegation under proposed paragraph 40(1)(ab), must be satisfied that the person has the appropriate training, qualifications or experience to appropriately exercise the delegated power or function.^[33]

Minister's response^[34]

2.68 The minister advised that, in his view, proposed paragraph 40(1)(ba) would strike an appropriate balance that ensures the FSC can effectively and efficiently discharge its duties while providing appropriate safeguards and parliamentary oversight.

2.69 In relation to the categories of people to whom powers and functions might be delegated, the minister advised that the Office of the FSC is comprised of one Senior Executive Service employee (the FSC) and a small number of Federal Safety Officers, all of whom are contractors engaged from the private sector for their building industry safety experience. The minister also noted that, despite being empowered to delegate all or any of the FSC's powers and functions to an FSO under existing paragraph 40(1)(a), it would not be appropriate to delegate to FSOs in all circumstances. The minister advised that, as a result, proposed paragraph 40(1)(ba) is necessary for the FSC to enable appropriately trained and experienced executive level employees in the Office of the FSC to make routine or minor decisions.

2.70 In addition, the minister advised that proposed paragraph 40(1)(ba) would preserve the FSC's current delegation powers.

2.71 The minister also noted that safeguards on the delegations power include the requirement to publish details of delegations, the requirement for delegates to comply with any directions of the FSC and parliamentary accountability through the Senate estimates process. Further, any direction given by the FSC of general application would be a legislative instrument and thus subject to parliamentary disallowance.

Committee comment

2.72 The committee thanks the minister for this response.

2.73 In relation to the categories of people to whom powers and functions might be delegated, the committee notes the minister's advice that the Office of the FSC has a relatively small number of employees and that the existing power to delegate to FSOs may not be appropriate in all circumstances. The committee notes the minister's advice that proposed paragraph 40(1)(ba) is therefore necessary to allow the FSC to delegate routine or minor decisions to appropriately trained and experienced executive level employees. However, the committee notes that this is not provided for on the face of the primary legislation. The committee therefore remains concerned that proposed paragraph 40(1)(ba) allows the FSC to delegate all or any of their powers and functions to any APS employee whose duties relate to the powers or functions of the FSC. While thanking the minister for this advice, the committee emphasises that it would have been more appropriate to include this guidance as a requirement on the face of the bill.

2.74 The committee notes the minister's advice that the broad delegations power in proposed paragraph 40(1)(ab) would preserve the FSC's current delegation powers. However, the committee does not consider that consistency with existing provisions is, of itself, sufficient justification for allowing the broad delegation of administrative powers and functions.

2.75 The committee further notes that the minister considers that there are appropriate safeguards and parliamentary oversight in place. While noting the minister's advice, the committee's preference is that a limit be set in the primary legislation on either the scope of powers that might be delegated or on the categories of people to whom those powers might be delegated.

2.76 As the bill has already passed both Houses of the Parliament, the committee makes no further comment on this matter.

Immunity from civil liability^[35]

2.77 The bill seeks to introduce several provisions which provide immunity from civil liability. These provisions are set out in item 303 and subitem 323(3) of Part 3 of Schedule 1 to the bill. Part 3 of Schedule 1 would amend the BCIIP Act to abolish the Australian Building and Construction Commission (ABCC) and provide transitional arrangements, including to transfer the responsibility for the ABCC's ongoing civil court proceedings to the Fair Work Ombudsman (FWO).

2.78 In Scrutiny Digest 7 of 2022 the committee requested the minister's detailed advice as to why it is considered necessary and appropriate to confer immunity from liability on the Australian Building and Construction Commissioner, the Fair Work Ombudsman (FWO), a Fair Work Inspector, consultants and staff members of the Office of the FWO and any persons assisting the FWO.^[36]

Minister's response^[37]

2.79 The minister advised that it is appropriate and proportionate to confer immunity from civil liability on the FWO and officials working for the FWO to support the transfer of the responsibility for the ABCC's ongoing civil court proceedings to the Fair Work Ombudsman.

2.80 The minister advised that this immunity is appropriate to ensure that the FWO and officials working for the FWO are able to fully meet their responsibilities in relation to ongoing civil court proceedings without risk of personal liability. In addition, the minister advised that the immunity would provide appropriate protection for officials carrying out of transitional functions in circumstances where they did not initiate or respond to these proceedings. The minister noted that these proceedings may relate to the exercise of powers by the Australian Building and Construction (ABC) Commissioner and ABC Inspectors to carry out investigations under the BCIIP Act which might otherwise be unlawful.

2.81 In relation to proportionality, the minister advised that the immunity is limited in terms of its application. The minister noted that a limited class of individuals would be afforded protection from liability in their professional capacity in a limited number of cases. Additionally, the minister advised that the immunity would conclude with the finalisation of matters transferred to the FWO. Further, the minister advised that a person would still be able to bring a civil action against the Commonwealth.

Committee comment

2.82 The committee thanks the minister for this response.

2.83 The committee notes the minister's advice that the protection from civil liability afforded by subitem 323(3) would be transitional in nature to ensure that the FWO and officials working for the FWO can manage the ABCC's ongoing civil court proceedings and ensure they do not incur civil liability while doing so. The committee also notes the minister's advice that this immunity is appropriate in circumstances where these officials did not initiate these proceedings. While noting the minister's advice that civil immunity is needed for the FWO and officials working for the FWO, the committee also notes that the immunity conferred by item 323 is broader and includes the FWO, a Fair Work Inspector, consultants and staff members of the Office of the FWO and any persons assisting the FWO.^[38]

2.84 As the bill has already passed both Houses of the Parliament, the committee makes no further comment on this matter.

Fees in delegated legislation^[39]

2.85 Item 393 of Part 8 of Schedule 1 to the bill seeks to insert proposed section 527F into the BCIIP Act to provide that an 'aggrieved person' may make an application for the FWC to deal with a sexual harassment dispute. Proposed subsection 527H(1) provides that an application must be accompanied by the fee, if any, that is prescribed in the regulations. Proposed paragraphs 527H(2)(a) and (b) provide that the regulations may prescribe the application fee, or the method for indexing the fee.

2.86 In Scrutiny Digest 7 of 2022 the committee requested the minister's advice as to whether the bill can be amended to provide high-level guidance regarding how the application fee in proposed subsection 527H(1) will be calculated, including, at a minimum, a provision stating that the fee must not be such as to amount to taxation.^[40]

Minister's response^[41]

2.87 The minister advised that a provision stating that the fee must not amount to a tax is unnecessary, as fees imposed under proposed section 527H cannot be read as authorising the imposition of a tax by virtue of section 15A of the Acts Interpretation Act 1901. The minister further advised that the provision is consistent with similar regulation making powers in the Fair Work Act 2009 (Fair Work Act) and, as a result, the inclusion of such a provision may cause confusion about the intended operation of existing provisions in the Fair Work Act.

Committee comment

2.88 The committee thanks the minister for this response.

2.89 While noting the minister's advice, the committee reiterates its view that this kind of guidance should be included on the face of the bill and that, at a minimum, the bill should include a provision stating that the fee must not be such as to amount to taxation. While there is no legal need to include such a provision, the committee considers that it is nonetheless importance to include it to avoid confusion and to emphasise the point that the amount calculated under the regulations will be a fee and not a tax. In addition, as set out in the Office of Parliamentary Counsel Drafting Direction 3.6, such a provision is useful as it may warn administrators that there is some limit on the level and type of fee which may be imposed.^[42]

2.90 As the bill has already passed both Houses of the Parliament, the committee makes no further comment on this matter.

Broad discretionary power
Significant matters in delegated legislation^[43]

2.91 Item 393 of Part 8 of Schedule 1 to the bill inserts proposed Part 3-5A into the Fair Work Act. The effect of this is to merge the stop sexual harassment order jurisdiction in existing Part 6-4B with a new prohibition on sexual harassment. Proposed Part 3-5A would allow a worker who has been bullied or sexually harassed at work to apply to the FWC for an order to stop the bullying or sexual harassment. Proposed sections 527N, 527P and 527Q would, respectively, permit the Chief of the Defence Force, the Director‑General of Security and the Director-General of the Australian Secret Intelligence Service (ASIS) to declare by legislative instrument, with the approval of the Minister, that some or all of the stop sexual harassment order provisions do not apply in relation to specified activities, or persons who carry out work for the Director‑General of Security or the Director‑General of ASIS.

2.92 In Scrutiny Digest 7 of 2022 the committee requested the minister's detailed advice regarding:

• why it is considered necessary and appropriate for the Chief of the Defence Force, the Director-General of Security and the Director-General of the Australian Secret Intelligence Service to be provided with broad powers under proposed sections 527N, 527P and 527Q to declare by legislative instrument that some or all of the stop sexual harassment order provisions do not apply; and

• whether the bill can be amended to provide at least high-level guidance regarding the exercise of these powers on the face of the primary legislation.^[44]

Minister's response^[45]

2.93 The minister advised that it would not be appropriate to amend the bill to provide high-level guidance regarding the exercise of these powers as the purpose of the powers is to provide flexibility to adapt the legislative framework in a timely manner in response to future unforeseen changes in the national security landscape. The minister advised that these powers are needed to ensure that the stop sexual harassment order provisions do not interfere with Australia's defence, national security or international law enforcement activities.

2.94 The minister noted that declarations issued by the Chief of the Defence Force, the Director‑General of Security and the Director-General of ASIS would be in the form of legislative instruments and therefore subject to consultation requirements and the usual parliamentary disallowance process. In addition, such declarations may only be made with the approval of the Minister for Employment and Workplace Relations.

2.95 The minister also advised that proposed sections 527N, 527P and 527Q are consistent with the existing stop sexual harassment order jurisdiction in the Fair Work Act and align with the existing framework for exemptions under the Work Health and Safety Act 2011.

2.96 The minister further advised that these limitations apply only in relation to the stop sexual harassment orders, that other military sanctions that could have a similar effect as a stop sexual harassment order may apply, and that other remedies for sexual harassment in connection with work would be available under the Fair Work Act.

2.97 Finally, the minister also advised that a new regulation-making power in proposed subsection 527F(3) would enable the regulations to specify the circumstances in which defence members may make stop sexual harassment order applications.^[46] A regulation made under this new power could only be used to narrow the limitation on defence members making applications.

Committee comment

2.98 The committee thanks the minister for this response.

2.99 The committee notes the minister's advice that exemptions to the stop sexual harassment order provisions are needed to ensure these provisions do not interfere with Australia's defence, national security or international law enforcement activities. However, the committee remains concerned about the use of delegated legislation to provide for such exemptions, particularly in circumstances where there is no guidance or limits on the face of the bill as to how or when these powers should be exercised. The committee also notes that the minister did not provide any evidence as to how these provisions protect Australia's defence, national security or international law enforcement activities. Further, the committee notes that there is nothing on the face of the primary legislation requiring that the Chief of the Defence Force, the Director‑General of Security and the Director-General of ASIS must consider whether the exemption would protect these matters before making an exemption instrument. It therefore remains unclear to the committee why it is not possible to provide even high‑level guidance within the bill in relation to the exercise of the broad discretionary powers under proposed sections 527N, 527P and 527Q.

2.100 The committee also notes the minister's advice that the granting of exemptions via delegated legislation is necessary to respond to unforeseen changes in the national security landscape in a timely manner. While acknowledging this advice, the committee has generally not accepted a desire for administrative flexibility to be a sufficient justification for leaving significant matters to delegated legislation.

2.101 The committee acknowledges that proposed sections 527N, 527P and 527Q would relocate existing powers in the Fair Work Act, rather than creating any new powers. However, the mere fact that these provisions align with the existing framework is not sufficient justification for the inclusion of broad discretionary powers.

2.102 The committee considers that it would be possible to provide powers which allow the necessary flexibility for the Chief of the Defence Force, the Director‑General of Security and the Director-General of ASIS to declare that some or all of the stop sexual harassment order provisions do not apply, while still providing appropriate limits on the exercise of the power. For example, it may be appropriate to include criteria which the Chief of the Defence Force, the Director‑General of Security and the Director-General of ASIS must have regard to before making a declaration that some or all of the stop sexual harassment order provisions do not apply. In this regard, the committee notes that the bill does not even include a requirement that the effect of the instrument on Australia's defence, national security or international law enforcement activities must be considered before an instrument is made. If it is not possible to include this guidance within the bill it would have been appropriate to provide more justification for the breadth of discretion afforded to the Chief of the Defence Force, the Director‑General of Security and the Director-General of ASIS under proposed sections 527N, 527P and 527Q. This is particularly so given the importance of the protections afforded to individuals under the stop sexual harassment order framework.

2.103 As the bill has already passed both Houses of the Parliament, the committee makes no further comment on this matter.

2.104 The committee draws this matter to the attention of the Senate Standing Committee for the Scrutiny of Delegated Legislation.

Legislative instrument not subject to disallowance^[47]

2.105 Item 509 of Part 14 of Schedule 1 to the bill seeks to repeal section 188 of the Fair Work Act and insert a new section 188 dealing with requirements for the FWC to be satisfied that an enterprise agreement has been genuinely agreed to by employees. Proposed subsection 188B(1) provides that the FWC must make a statement of principles containing guidance for employers on how to ensure their employees have genuinely agreed to an enterprise agreement. Proposed subsection 188B(4) provides that the statement of principles is a non-disallowable legislative instrument.

2.106 In Scrutiny Digest 7 of 2022 the committee requested the minister's detailed advice as to:

• the exceptional circumstances that are said to justify exempting the statement of principles made under proposed subsection 188B(1) from the usual parliamentary disallowance process; and

• whether the bill could be amended to provide that the statement of principles is subject to disallowance to ensure that they receive appropriate parliamentary oversight.^[48]

Minister's response^[49]

2.107 The minister advised that the making of the statement of principles is divorced from the political process and should therefore be independent of the Parliament and not subject to disallowance. The minister advised that the need for rule-making to be separated from the political process has been accepted as a rationale for exempting other legislative instruments from disallowance.^[50]

2.108 The minister advised that the FWC will rely on the statement of principles in a technical manner when approving enterprise agreements. For this reason, the minister considered that allowing the Parliament to scrutinise the statement through disallowance may undermine the FWC's decision-making and independence, could potentially create uncertainty for employers and could bring into question the integrity of any enterprise agreements approved by the FWC in reliance on the statement.

2.109 Finally, the minister advised that the statement of principles would not create any new rights or obligations for employers or their employees. The minister also noted that the minimum requirements for the statement of principles—which are set out in proposed subsection 188B(3)—have already been scrutinised by the Parliament and therefore that further parliamentary oversight would be redundant.

Committee comment

2.110 The committee thanks the minister for this response.

2.111 The committee notes that the minister considers the making of the statement of principles to be divorced from the political process and that the statement should not be subject to disallowance on this basis. The minister noted in his response that this rationale has been previously accepted and cited the final report of the Standing Committee for the Scrutiny of Delegated Legislation's (Delegated Legislation Committee) inquiry into the exemption of delegated legislation from parliamentary oversight to support this view. However, the committee notes that the Delegated Legislation Committee was critical of a blanket claim that technical instruments should be divorced from the political process and emphasised that the Parliament is capable of understanding scientific or technical issues.^[51] The Delegated Legislation Committee questioned the legitimacy of this rationale and found that, while there may be limited circumstances in which there may be appropriate grounds for exemptions, exemptions from disallowance on the basis of a need for rule-making to be separated from the political process are highly unlikely to be accepted.^[52]

2.112 This committee shares the long‑standing scrutiny concerns of the Delegated Legislation Committee regarding the inappropriate exemption of delegated legislation from disallowance on this basis of this rationale. While it is often appropriate to delegate law-making power to the executive in relation to technically complex matters, it does not follow that such instruments should subsequently be exempt from disallowance on that basis alone. It is not clear why parliamentarians would be incapable of taking into account technical evidence, or any resulting outcomes that could flow from disallowance, when considering the appropriateness of an instrument. Moreover, the committee considers that decisions which can be classified as completely apolitical are rare. Even when relevant considerations are technical the potential implications of those considerations will often have more expansive implications. Finally, the committee notes that in this instance the minister has provided very little explanation as to why the statement of principles is uniquely apolitical, such as might make an exemption from disallowance appropriate.

2.113 The committee also notes the minister's advice regarding the intended use of the statement of principles. While noting this advice, the committee does not consider the fact that an instrument is intended to be explanatory and facilitative to be a sufficient justification for excluding parliamentary disallowance in circumstances where the instrument is proposed to be a legislative instrument.

2.114 The committee also notes the minister's advice that the Parliament has had the opportunity to scrutinise the minimum requirements for the statement of principles, and therefore that further parliamentary oversight would be redundant. However, the committee notes that proposed paragraphs 188B(3)(f) and (g) provide considerable scope for the statement of principles to deal with any matters prescribed by the regulations and any other matters the FWC considers relevant.

2.115 As to the minister's advice regarding the potential for disallowance to create uncertainty, the committee notes that need for certainty could be met by having the delegated legislation come into effect after the disallowance period has expired. Further, it is well established that the instances of the disallowance procedure resulting in disallowance by the Parliament is very low. Senators, as elected representatives, would be well aware of any impact that disallowance would have and would consider such matters as part of their deliberations. The committee also emphasises that in many ways uncertainty is inherent to lawmaking within Australia's system of representative government. While some degree of uncertainty exists in relation to the disallowance process, it is important not to overstate its significance. As a general principle, the committee does not consider that the difficulties associated with the small degree of uncertainty inherent in the disallowance process outweigh the significance of abrogating or limiting parliamentary oversight of executive made law by exempting an instrument from disallowance.

2.116 It remains unclear what genuinely exceptional circumstances are said to justify exempting the statement of principles from disallowance.

2.117 As the bill has already passed both Houses of the Parliament, the committee makes no further comment on this matter.

2.118 The committee draws this matter to the attention of the Senate Standing Committee for the Scrutiny of Delegated Legislation for information.

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[31] Schedule 1, Part 3, item 222, proposed paragraph 40(1)(ba). The committee draws senators' attention to this provision pursuant to Senate standing order 24(1)(a)(ii).

[32] See Building and Construction Industry (Improving Productivity) Act 2016, section 38.

[33] Senate Scrutiny of Bills Committee, Scrutiny Digest 7 of 2022 (23 November 2022) pp. 27–29.

[34] The minister responded to the committee's comments in a letter dated 30 November 2022. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 1 of 2023 available at: www.aph.gov.au/senate_scrutiny_digest.

[35] Schedule 1, Part 3, item 303, proposed section 118 and subitem 323(3). The committee draws senators' attention to these provisions pursuant to Senate standing order 24(1)(a)(i).

[36] Senate Scrutiny of Bills Committee, Scrutiny Digest 7 of 2022 (23 November 2022) pp. 29–30.

[37] The minister responded to the committee's comments in a letter dated 30 November 2022. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 1 of 2023 available at: www.aph.gov.au/senate_scrutiny_digest.

[38] Defined in section 698 of the Fair Work Act 2009.

[39] Schedule 1, Part 8, item 393, proposed section 527H. The committee draws senators' attention to this provision pursuant to Senate standing order 24(1)(a)(iv).

[40] Senate Scrutiny of Bills Committee, Scrutiny Digest 7 of 2022 (23 November 2022) pp. 30–31.

[41] The minister responded to the committee's comments in a letter dated 30 November 2022. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 1 of 2023 available at: www.aph.gov.au/senate_scrutiny_digest.

[42] Office of Parliamentary Counsel, Drafting Direction 3.6, October 2012, p. 38.

[43] Schedule 1, Part 8, item 393, proposed sections 527N, 527P and 527Q. The committee draws senators' attention to these provisions pursuant to Senate standing order 24(1)(a)(ii) and (iv).

[44] Senate Scrutiny of Bills Committee, Scrutiny Digest 7 of 2022 (23 November 2022) pp. 31–33.

[45] The minister responded to the committee's comments in a letter dated 30 November 2022. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 1 of 2023 available at: www.aph.gov.au/senate_scrutiny_digest.

[46] Proposed subsection 527F(3) would prevent a defence member from applying for a stop sexual harassment order in relation to sexual harassment that occurred while they were a defence member, except as provided by the regulations.

[47] Schedule 1, Part 14, item 509, proposed subsection 188B(4). The committee draws senators' attention to this provision pursuant to Senate standing order 24(1)(a)(iv).

[48] Senate Scrutiny of Bills Committee, Scrutiny Digest 7 of 2022 (23 November 2022) pp. 34–35.

[49] The minister responded to the committee's comments in a letter dated 30 November 2022. A copy of the letter is available on the committee's website: see correspondence relating to Scrutiny Digest 1 of 2023 available at: www.aph.gov.au/senate_scrutiny_digest.

[50] The minister cited the following report to support this claim: Senate Standing Committee for the Scrutiny of Delegated Legislation, Inquiry into the exemption of delegated legislation from parliamentary oversight: Final report (March 2021) [4.28]-[4.39].

[51] Senate Standing Committee for the Scrutiny of Delegated Legislation, Inquiry into the exemption of delegated legislation from parliamentary oversight: Final report (March 2021) pp. 43–45.

[52] Senate Standing Committee for the Scrutiny of Delegated Legislation, Inquiry into the exemption of delegated legislation from parliamentary oversight: Final report (March 2021) pp. 106 and 116.