Workplace Authority says “please explain” about agreements lodged under new Fairness Test

They said they didn’t need it, but the Government’s introduction of the so-called Fairness Test has created a backlog of agreements with the bulk of them requiring further information.  Between May 7 when the fairness test took effect and July 1, 40,000 of the 52,000 agreements lodged with the Workplace Authority have required more information.  Prior to the introduction of the Fairness Test these agreements would have gone through the system without any assessment at all, with workers potentially losing benefits such as penalty rates, public holidays, pay increases and so on.

The Workplace Authority applies the Fairness Test to agreements to make sure that employees receive fair compensation if their agreement removes or changes their protected conditions.

Protected award conditions are:

• Rest breaks
• Incentive - based payments and bonuses
• Annual leave loadings
• Observance of public holidays and entitlements to payments in respect of those days
• Substituted public holidays, or a procedure for substituting public holidays
• Monetary allowances for

o    Expenses incurred during course of employment, or

o    Responsibilities or skills that are not taken into account in rates of pay for employees

o    Disabilities associated with performance of particular tasks or work in particular conditions or locations

• Loadings for working overtime or for shift work
• Penalty rates

However, be very clear that employees can still lose these conditions.   The Government’s Fairness Test still allows agreements to go through which cut these conditions provided the Workplace Authority is satisfied that on balance the employee is not worse off.  The Workplace Authority can look at the whole package and decide the agreement is OK even if it cuts rates or abolishes penalty rates provided it is satisfied that the employee has been adequately compensated for the loss of these rights.

So you can lose your entitlements if ‘in appropriate circumstances’ the Workplace Authority looks at ‘the industry, location and economic circumstances or the business and specific employment circumstances or opportunities of the employee’ and decides fairness is a luxury.

Basically, if your employer complains about how much they’re struggling or if it’s decided that in your circumstance you are lucky to get the job offer (minus past rights) it’s possible you can lose the lot.

The so-called ‘fairness test’ will somehow balance monetary and non-monetary compensation to come up with a view that you have been adequately compensated.  Again there is no guarantee you will be as well off as before.  You just have to adequately compensated.  And what is adequate will be in the eye of the Workplace Authority.

But what does that mean?  How do they decide you have been adequately compensated?

Again you also need to look at the fine print to see how devious this Government is.  In deciding what is fair compensation, Workplace Authority will compare the employer’s offer against the rates and conditions in the award operating in the industry NOT the current collective agreement.

In most instances CEPU members are working under collective agreement with pay rates far superior to the industry award.  The difference between what you earn under and agreement and an the relevant award has been increasing for years as

Comparing a current 2007 offer by the employer with an award whose rates of pay bear no relation to the going market rates in the agreement, is hardly a fair test.

To be truly fair, the test should at the very least compare the employer’s offer against the current agreement - not the award - because this is what employees are currently getting.  And there should be no wriggle room.  The test should be objective – it’s either fair compensation for losing penalty rates and the like or it’s not.