Fair Work (State Declarations — employer not to be national system employer) Endorsement (No. 1) 2024

Overview

The Fair Work (State Declarations – employer not to be national system employer) Endorsement 2024 (No. 1) was enacted to address the need for certain employers to be exempt from the national workplace relations framework, allowing for regulation under state laws instead. This Endorsement, made under the Fair Work Act 2009, recognises that some entities integral to state and local government administration are more appropriately regulated by the states and territories. The endorsement affirms that the Murray Art Museum Albury Limited, a company wholly owned and controlled by the Albury City Council, is not a national system employer and thus exempt from the Fair Work Act. The endorsement aims to ensure certainty for the employment arrangements of such entities by providing enduring legislative clarity, as outlined in the Explanatory Statement to the 2015 Regulation. The endorsement will commence once registered on the Federal Register of Legislation, ensuring that the Murray Art Museum Albury Limited and its employees are subject to NSW workplace laws rather than the national framework.

Scope and Application

The Fair Work (State Declarations – employer not to be national system employer) Endorsement 2024 (No. 1) pertains to the Murray Art Museum Albury Limited, which has been declared by the State of New South Wales not to be a national system employer under the Fair Work Act 2009. This declaration, endorsed by the Minister for Employment and Workplace Relations, exempts the declared employer from the Fair Work Act, thereby subjecting it to the workplace relations arrangements under NSW laws. The Murray Art Museum Albury Limited, a company limited by guarantee wholly owned and controlled by the Albury City Council, was established for a local government purpose under the Local Government Act 1993 (NSW). The Endorsement recognises that certain entities integral to local government administration may be more appropriately regulated by State and Territory laws rather than the national system. However, certain provisions of the Fair Work Act, specifically Parts 6-3 and 6-4 relating to unlawful termination of employment, notice of termination, and parental leave, will still apply to the declared employer and its employees. This Endorsement is a legislative instrument but is exempt from disallowance and sunsetting, ensuring enduring certainty for the employment arrangements of the relevant employer and its employees.

Key Provisions

The Fair Work (State Declarations — employer not to be national system employer) Endorsement 2024 (No. 1) endorses a declaration made under the Industrial Relations Act 1996 (NSW) that the Murray Art Museum Albury Limited is not a national system employer under the Fair Work Act 2009 (Fair Work Act). This means that the Murray Art Museum Albury Limited will not be subject to the Fair Work Act, and its employees will not be subject to the Fair Work Act either, except for certain provisions related to unlawful termination, notice of termination, and parental leave (sections 14(2), 14(6), and 14(7) of the Fair Work Act). The Endorsement will commence on the day after it is registered on the Federal Register of Legislation. Under the Fair Work Act, an employer is a national system employer if it is a constitutional corporation, the Commonwealth or a Commonwealth authority, or if it employs certain workers in connection with constitutional trade or commerce, among other things (section 14(1) of the Fair Work Act). However, a particular employer can be declared by a State or Territory law as not being a national system employer if it is a body established for a public or local government purpose under a State or Territory law, and this declaration is endorsed by the Minister for Employment and Workplace Relations (section 14(2) of the Fair Work Act). This allows the States and Territories to regulate certain employment relationships, such as those involving local government entities. Certain industries, such as electricity, gas, water, rail services, and ports, cannot be declared as not being national system employers (section 14(6) of the Fair Work Act). Additionally, Australian universities established under a State or Territory law cannot be declared as not being national system employers (section 14(7) of the Fair Work Act). The Murray Art Museum Albury Limited is a company limited by guarantee, formed by the Albury City Council, and is wholly owned and controlled by the Council. It was established for the purpose of managing and operating the Murray Art Museum Albury. The Murray Art Museum Albury Limited was declared not to be a national system employer under the Industrial Relations Act 1996 (NSW), and this declaration has been endorsed by the Minister for Employment and Workplace Relations. As a result, the Murray Art Museum Albury Limited will not be subject to the Fair Work Act, and its employees will not be subject to the Fair Work Act either, except for certain provisions related to unlawful termination, notice of termination, and parental leave. The Endorsement is a legislative instrument for the purposes of the Legislation Act 2003 (Legislation Act), but it is not subject to disallowance and sunsetting under that Act (subsection 14(5) of the Fair Work Act and item 27 in the table in section 12 of the Legislation (Exemption and Other Matters) Regulation 2015 (2015 Regulation)). The Explanatory Statement to the 2015 Regulation outlines the objective behind the exemption of instruments made under subsection 14(4) of the Fair Work Act from sunsetting, including that it ‘is designed to ensure certainty for the employment arrangements that apply to the relevant State or Territory employers and employees’ and that such instruments are ‘enduring and not appropriate for sunsetting’. This means that the Endorsement will remain in force until it is repealed or amended by a subsequent legislative instrument. Breaching the provisions of the Endorsement could result in civil or criminal consequences, depending on the nature and severity of the breach. For example, if an employer fails to comply with the workplace relations arrangements under NSW laws, it could be subject to fines or other penalties under the Industrial Relations Act 1996 (NSW). Similarly, if an employer fails to comply with the provisions of the Fair Work Act that continue to apply to the Murray Art Museum Albury Limited and its employees, it could be subject to fines or other penalties under the Fair Work Act. The maximum penalties for breaches of the Fair Work Act can vary depending on the offence, and can include fines of up to $66,600 for individuals and up to $333,000 for bodies corporate (section 534 of the Fair Work Act). In addition, criminal offences under the Fair Work Act can result in imprisonment for up to two years (section 546 of the Fair Work Act).