EXPLANATORY STATEMENT
Issued by the authority of the Minister for Employment
Fair Work Act 2009
Section 14
Fair Work (State Declarations — employer not to be national system employer) Endorsement 2014 (No.4)
The Fair Work Act 2009 (the Fair Work Act) sets out the workplace relations framework for national system employers and national system employees.
Under subsection 14(1) of the Fair Work Act a national system employer means any of the following in its capacity as an employer of an individual:
- a constitutional corporation;
- the Commonwealth or a Commonwealth authority;
- a person who employs a flight crew officer, maritime employee or waterside worker in connection with constitutional trade or commerce;
- a body corporate incorporated in a Territory; or
- a person who carries on an activity in a Territory and employs a person in connection with the activity.
A national system employee is an individual employed by a national system employer (section 13 of the Fair Work Act).
The Parliaments of Victoria, South Australia, Tasmania, Queensland and New South Wales referred power to the Commonwealth Parliament to extend the Fair Work Act to employers and their employees in these States that are not already covered by sections 13 and 14. Division 2A and Division 2B of Part 1-3 of the Fair Work Act give effect to State workplace relations references by extending the meaning of national system employee and national system employer (sections 30C, 30D, 30M and 30N of the Fair Work Act).
Certain entities are integral to State, Territory and local government administration and the employment relationships of these entities may be appropriately regulated by States and Territories. Such entities may be excluded from State references. Additionally, subsection 14(2) of the Fair Work Act allows States and Territories to declare (subject to endorsement by the Commonwealth Minister) that certain employers over which the Commonwealth would otherwise have jurisdiction are not national system employers.
Under subsection 14(2) of the Fair Work Act a particular employer is not a national system employer if it is declared as such by or under a law of a State or Territory. To be effective, a State or Territory declaration is required to specify the employer that is not to be a national system employer and a written endorsement by the Minister administering the Fair Work Act must be in force in relation to the employer.
A declaration may only be made in respect of an employer that is:
- a body established for a public purpose by or under a law of a State or Territory, by the Governor of a State, by the Administrator of a Territory or by a Minister of a State or Territory; or
- a body established for a local government purpose by or under a law of a State or Territory or an entity that is wholly owned or controlled by such a body.
Under subsection 14(6) of the Fair Work Act, unless the employer is a local government employer (or an entity that is wholly-owned or controlled by such an employer) a State or Territory declaration cannot be made in relation to an employer that:
- generates, supplies or distributes electricity;
- supplies or distributes gas;
- provides services for the supply, distribution or release of water; or
- operates a rail service or a port.
A State or Territory declaration cannot be made in relation to an employer that is an Australian university within the meaning of the Higher Education Support Act 2003 (subsection 14(7) of the Fair Work Act) established under a law of a State or Territory.
The effect of an endorsement is that an employer specified in it will not generally be subject to the Fair Work Act and will instead be subject to the workplace relations arrangements prescribed by the relevant State or Territory. An endorsement also has the effect that a specified employer’s employees are not generally subject to the Fair Work Act, because only employees of national system employers can be national system employees. However, Parts 6-3 and 6-4 of the Fair Work Act, which relate to unlawful termination of employment, notice of termination and parental leave and which apply to employers and employees nationally, will continue to apply.
The name of this endorsement is the Fair Work (State Declarations — employer not to be national system employer) Endorsement 2014 (No.4). The Endorsement endorses a declaration made by the Industrial Relations Regulation 2011 (Qld), as amended by the Industrial Relations and Another Regulation Amendment Regulation (No. 1) 2014 (Qld), that the Queensland Training Assets Management Authority is not a national system employer. The Endorsement commences on 30 September 2014.
The Endorsement is a legislative instrument for the purposes of the Legislative Instruments Act 2003 but is not subject to the disallowance or sunsetting provisions of that Act (subsection 14(5) of the Fair Work Act).
Overview
The Fair Work (State Declarations — employer not to be national system employer) Endorsement 2014 (No.4) was introduced to address the issue of ensuring that certain employers, specifically those established for public or local government purposes in various states, are not classified as national system employers under the Fair Work Act 2009. This legislative instrument, endorsed by the Minister for Employment, aligns with the policy objective of allowing states and territories to regulate workplace relations for specific entities integral to their administration, thus providing a more tailored approach to employment regulation. The endorsement ensures that the Fair Work Act does not apply to these entities, enabling them to be governed by state or territory laws instead. The endorsement was enacted by the Commonwealth Parliament in response to referrals of power from the respective state parliaments and aims to maintain the balance between federal and state jurisdiction in employment relations.
Scope and Application
The Fair Work (State Declarations — employer not to be national system employer) Endorsement 2014 (No.4) operates within the framework of the Fair Work Act 2009, providing a mechanism for specific employers in Queensland to be excluded from the national system's workplace relations provisions. This endorsement applies to employers designated by state legislation as not being national system employers, effectively exempting them from the overarching federal regulatory regime established by the Fair Work Act. The endorsement endorses a declaration made by the Queensland Industrial Relations Regulation 2011, specifying that the Queensland Training Assets Management Authority is not considered a national system employer, thereby subjecting it to Queensland’s workplace relations laws rather than the federal regime. This exclusion is effective from 30 September 2014, and while the endorsement does exempt the specified employer from most provisions of the Fair Work Act, it does not affect the application of certain national provisions concerning unlawful termination of employment, notice of termination, and parental leave. The endorsement is a legislative instrument under the Legislative Instruments Act 2003 but is not subject to the disallowance or sunsetting provisions of that Act.
Key Provisions
The Fair Work (State Declarations — employer not to be national system employer) Endorsement 2014 (No. 4) operates under the framework established by the Fair Work Act 2009. This endorsement specifically targets employers that are not to be classified as national system employers under the Act. Under section 14(2) of the Fair Work Act, a particular employer can be declared by a State or Territory law as not being a national system employer, provided that this declaration is endorsed by the Minister for Employment. This endorsement means that the specified employer and their employees will not be subject to the Fair Work Act but instead will be governed by the workplace relations arrangements of the relevant State or Territory (section 14(6)). However, it is important to note that certain provisions of the Fair Work Act, such as those related to unlawful termination of employment, notice of termination, and parental leave, will still apply regardless of the endorsement.
The Fair Work Act imposes certain obligations and requirements on the parties it governs. Firstly, it mandates that national system employers, defined under section 14(1), adhere to the regulations set forth in the Act. This includes constitutional corporations, the Commonwealth or Commonwealth authorities, and employers in specific industries such as maritime, flight crew, and utilities. Secondly, the Act requires employers to comply with state and territory workplace relations laws where applicable. Under this endorsement, the specified employer, such as the Queensland Training Assets Management Authority in this case, must align with the workplace relations arrangements prescribed by the relevant state or territory. It is also crucial that the employer and its employees are aware of their rights and obligations under the endorsed arrangements, particularly in areas not covered by the Fair Work Act.
Breach of the provisions under the Fair Work Act or the endorsed state or territory arrangements can lead to various consequences. For civil matters, an employee may seek remedies such as compensation for unlawful termination or unpaid leave. Under section 543 of the Fair Work Act, penalties can include compensation for loss or damage suffered by the employee. For criminal matters, the Act provides for offences such as serious contraventions of the Act, which can result in substantial fines. Under section 603, the maximum penalty for serious contraventions can be up to $66,600 for individuals and significantly higher for corporations. Additionally, the Act allows for the imposition of criminal sanctions, including imprisonment, in cases of deliberate or reckless breaches. It is important for employers and employees to be aware of these potential consequences to ensure compliance with the legislation.