Fair Work (State Declarations — employer not to be national system employer) Endorsement (No. 2) 2024

Administered by Department of Employment and Workplace Relations

Legislation au F2024L01405 In force Legislative Instrument

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EXPLANATORY STATEMENT

Issued by authority of the Minister for Employment and Workplace Relations

Fair Work Act 2009

Section 14

Fair Work (State Declarations — employer not to be national system employer) Endorsement (No. 2) 2024

 

The Fair Work (State Declarations – employer not to be national system employer) Endorsement (No. 2) 2024 (the Endorsement) is made under paragraph 14(4)(a) of the Fair Work Act 2009 (Fair Work Act), and endorses a declaration made under the Industrial Relations Act 1996 (NSW) that The Pavilion: Performing Arts Centre Sutherland Limited (the declared employer) is not a national system employer. The Endorsement will commence on the day after it is registered on the Federal Register of Legislation.

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).

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 and a written endorsement by the Minister administering the Fair Work Act is in force in relation to the employer. This recognises that certain entities are integral to State, Territory and local government administration and the employment relationships of these entities may be appropriately regulated by the States and Territories.

A State or Territory 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 a wholly owned subsidiary of 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 Pavilion: Performing Arts Centre Sutherland Limited is a company limited by guarantee. It was formed by the Sutherland Shire Council (Council). It is wholly owned and controlled by the Council. It was established for the purpose of managing and operating the Pavilion Performing Arts Centre and the Sutherland Arts Theatre. The body was established for a local government purpose under a law of the State, specifically the Local Government Act 1993 (NSW) (LG Act). The Council obtained the relevant NSW Minister’s consent to form the entity on 14 December 2022.

The effect of the Endorsement is that the declared employer will not generally be subject to the Fair Work Act and will instead be subject to the workplace relations arrangements under NSW laws. The Endorsement has the effect that the declared employers’ employees are not generally subject to the Fair Work Act, because only employees of national system employers can be national system employees. However, some parts of the Fair Work Act, including Parts 6-3 and 6-4 (which relate to unlawful termination of employment, notice of termination, parental leave and paid family and domestic violence leave), apply to all employers and employees, and will continue to apply.

The Endorsement is a legislative instrument for the purposes of the Legislation Act 2003 (Legislation Act) but is not subject to disallowance or sunsetting under that Act (subsection 14(5) of the Fair Work Act and item 27 in the table in s 12 of the Legislation (Exemptions and Other Matters) Regulation 2015 (2015 Regulation)). The Explanatory Statement to the Fair Work Amendment (State Referrals and Other Measures) Act 2009 explains that the instrument is not subject to disallowance and sunsetting to ensure certainty of rights and entitlements for the employers and employees that will be subject to exclusion.

The Explanatory Statement to the 2015 Regulation similarly 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’.

 

 

 

Overview

The Fair Work (State Declarations – employer not to be national system employer) Endorsement (No. 2) 2024 was enacted to endorse a declaration made under the Industrial Relations Act 1996 (NSW) that The Pavilion: Performing Arts Centre Sutherland Limited is not a national system employer under the Fair Work Act 2009. This endorsement was made by the Minister for Employment and Workplace Relations under the authority of the Fair Work Act, aiming to clarify the regulatory framework governing the employment relationships of entities integral to State and Territory government administration. By excluding certain employers from the national system, the Act recognises that these entities may be more appropriately regulated by State and Territory laws rather than the federal system. The Endorsement ensures that the Pavilion and its employees are governed by NSW workplace relations laws instead of the federal Fair Work Act, while certain federal protections, such as those related to unlawful termination of employment and leave entitlements, will still apply.

Scope and Application

The Fair Work (State Declarations – employer not to be national system employer) Endorsement (No. 2) 2024 applies to The Pavilion: Performing Arts Centre Sutherland Limited, a company limited by guarantee established and wholly owned by the Sutherland Shire Council, for the purpose of managing and operating the Pavilion Performing Arts Centre and the Sutherland Arts Theatre. This endorsement, made under the Fair Work Act 2009, recognises that certain entities integral to local government administration may be more appropriately regulated by state laws rather than the national workplace relations system. By virtue of this endorsement, the declared employer is exempted from being a national system employer, thus avoiding the application of the Fair Work Act to its employment practices. This exemption is subject to certain exclusions, such as employers involved in electricity, gas, water supply, rail services, ports, or Australian universities, which remain under the purview of the Fair Work Act. Notably, while the majority of the Fair Work Act will not apply to the declared employer, specific provisions concerning unlawful termination, parental leave, and family and domestic violence leave will continue to apply to all employers and employees. The endorsement, while a legislative instrument under the Legislation Act 2003, is not subject to disallowance or sunsetting provisions, ensuring enduring certainty for the affected employers and employees.

Key Provisions

The Fair Work (State Declarations – employer not to be national system employer) Endorsement (No. 2) 2024 endorses a declaration under the Industrial Relations Act 1996 (NSW) that The Pavilion: Performing Arts Centre Sutherland Limited is not a national system employer. This endorsement effectively exempts the declared employer from the national workplace relations framework established by the Fair Work Act 2009, instead subjecting it to the workplace relations arrangements under NSW laws (section 14(4)(a)). This provision recognises that certain entities integral to State, Territory, and local government administration have employment relationships that may be more appropriately regulated by the States and Territories. Entities governed by this endorsement must comply with NSW workplace laws rather than the national system established by the Fair Work Act. This includes adherence to the specific provisions and regulations under NSW industrial relations legislation, ensuring that their employment practices align with state-specific requirements. The declared employer must also ensure that their activities do not fall within the prohibited categories that could still subject them to the Fair Work Act, such as generating, supplying, or distributing electricity, gas, or water, or operating a rail service or a port (subsection 14(6) and (7)). Failure to comply with the requirements set forth by the endorsement or NSW laws could lead to various consequences, including potential enforcement actions by the relevant NSW authorities. While the endorsement itself does not detail specific penalties, breaches of NSW industrial relations laws could result in fines, legal proceedings, or other administrative actions as stipulated by the relevant NSW legislation. The endorsement ensures certainty for the employment arrangements of the declared employer and its employees by exempting it from disallowance and sunsetting under the Legislation Act 2003, thus maintaining the stability of the employment framework for these entities.

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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.