Fair Work (State Declarations — employer not to be national system employer) Endorsement 2016 (No. 2)

Administered by Department of Employment and Workplace Relations

Legislation au F2016L00086 In force Legislative Instrument

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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 2016 (No. 2)

 

 

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 established under a law of a State or Territory (subsection 14(7) of the Fair Work Act).

 

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 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 all employers and employees will continue to apply.

 

The name of this endorsement is the Fair Work (State Declarations – employer not to be national system employer) Endorsement 2016 (No. 2). The Endorsement endorses a declaration made under the Local Government Act 1999 (SA) that Eastern Region Alliance Water is not a national system employer. Although Eastern Region Alliance Water provides services for the supply and distribution of water, it can be subject to an endorsement as it was established for a local government purpose and is wholly controlled by a group of local government entities in accordance with subsection 14(6) of the Fair Work Act. The Endorsement commences on 1 March 2016.

 

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 Act 2009, enacted by the Commonwealth Parliament, establishes a national framework for workplace relations, governing employers and employees under the national system. However, the Parliaments of certain states referred additional powers to the Commonwealth to extend the Act's scope to employers within their jurisdictions who were not previously covered. To address this, the Fair Work (State Declarations — employer not to be national system employer) Endorsement 2016 (No. 2) was introduced to endorse state declarations that certain employers should not be considered national system employers. This endorsement endorses a declaration under the Local Government Act 1999 (SA) regarding Eastern Region Alliance Water, allowing it to be regulated by South Australian workplace relations laws rather than the national system. The policy objective is to ensure that certain public and local government employers, particularly those integral to state and local government administration, are appropriately regulated by state and territory laws rather than the national framework.

Scope and Application

The Fair Work (State Declarations – employer not to be national system employer) Endorsement 2016 (No. 2) applies to certain employers that would otherwise fall under the Commonwealth’s jurisdiction under the Fair Work Act 2009 but are excluded through specific State declarations endorsed by the Minister for Employment. This endorsement specifically targets employers that are established for public or local government purposes, excluding those involved in electricity, gas, water supply, or rail and port operations, as well as Australian universities. The endorsement ensures that these specified employers are not considered national system employers, thus not subject to the Fair Work Act but instead governed by the relevant State or Territory’s workplace relations arrangements. However, it is important to note that provisions regarding unlawful termination of employment, notice of termination, and parental leave continue to apply to all employers and employees regardless of the endorsement. This legislative instrument, although not subject to disallowance or sunsetting provisions, came into effect on 1 March 2016, endorsing the declaration made under the Local Government Act 1999 (SA) for Eastern Region Alliance Water.

Key Provisions

The Fair Work (State Declarations — employer not to be national system employer) Endorsement 2016 (No. 2) represents a legislative instrument under the Fair Work Act 2009, which governs workplace relations for national system employers and employees. Section 14 of the Act specifies what constitutes a national system employer, including constitutional corporations, the Commonwealth, employers of flight crew officers, maritime employees, and waterside workers, bodies corporate incorporated in a Territory, and persons carrying on activities in a Territory who employ others in connection with those activities. In addition, State and Territory Parliaments can refer workplace relations powers to the Commonwealth, which allows for the extension of the Fair Work Act to employers and employees not already covered by sections 13 and 14 of the Act. This endorsement endorses a declaration made under the Local Government Act 1999 (SA) that Eastern Region Alliance Water is not a national system employer. It permits certain employers to be excluded from the definition of national system employers, provided they are established for a public or local government purpose and are not involved in generating, supplying, or distributing electricity, gas, or water, or operating a rail service or a port. The endorsement also ensures that Australian universities established under a State or Territory law are not subject to the Fair Work Act. The endorsement imposes obligations on the Minister administering the Fair Work Act to endorse declarations made by States or Territories. To be valid, these declarations must specify the employer not to be considered a national system employer and include a written endorsement from the Minister. Employers endorsed under this scheme will be regulated by State or Territory workplace relations arrangements rather than the Fair Work Act, with the exception of Parts 6-3 and 6-4 of the Act, which pertain to unlawful termination of employment, notice of termination, and parental leave. There are no specific offences, penalties, or consequences for breach outlined in this endorsement. However, failure to comply with the Fair Work Act or any endorsed State or Territory workplace relations arrangements could lead to legal action, fines, or other penalties under the relevant legislation. The endorsement itself is a legislative instrument under the Legislative Instruments Act 2003 but is exempt from disallowance or sunsetting provisions under subsection 14(5) of the Fair Work Act.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.