Further Changes to Australian Workplace Laws: Protecting Worker Entitlements Act

The Fair Work Legislation Amendment (Protecting Worker Entitlements) Act 2022 (Cth) (Protecting Worker Entitlements Act) received Royal Assent on 30 June 2023, triggering a number of further changes to the Fair Work Act 2009 (Cth) (Fair Work Act) and associated legislation.

This article covers the key amendments that have or will be implemented as a result of the Protecting Worker Entitlements Act, reminding organisations to continue to review their existing operations to ensure ongoing compliance with employment laws.  

Following the recent changes to the Fair Work Act which took effect on 6 June 2023 (see related article), the Protecting Worker Entitlements Act further amends the Fair Work Act in the following areas: 

• coverage of migrant workers; 

• unpaid parental leave;

•  introducing a right to superannuation guarantees within the National Employment Standards (NES);

•  workplace determinations as it relates to enterprise agreements;

• payroll deductions for authorised purposes; and

• providing casual workers in the black coal mining industry with access to long service leave (note that these amendments are not covered by the Fair Work Act).

We summarise these key changes in further detail below. 

1. Continued Protection afforded to migrant workers

Prior position: If a migrant worker breached the terms of their visa or jeopardised their immigration status in any way, that worker’s employment contract became null and void, resulting in the loss of employee entitlements and protections afforded by the Fair Work Act. 

From 1 July 2023: The Fair Work Act now contains a provision confirming that the Migration Act 1958 (Cth) (or any instrument made under that Act) will not affect the validity of a contract of employment or a contract for services. Migrant workers, including temporary migrant workers, will now be entitled to the benefit of the Fair Work Act at all times, irrespective of their immigration status.

2. Unpaid parental leave

Prior position: In addition to paid parental leave funded by the Federal Government pursuant to the Paid Parental Leave Act 2010 (Cth) (PPL Act) (for those who meet the requisite eligibility tests) or that which is provided in an employment contract, company policy or an industrial instrument, an Australian employee who becomes a parent can access 12 months of unpaid parental leave under the NES, which:

• must be taken in a single continuous period;
   
• can include up to 30 days of flexible unpaid parental leave which can be taken at any time within 24 months of birth or adoption of the child, but an employee’s entitlement to continuous unpaid parental leave will end as soon as the employee takes flexible unpaid parental leave;
   
• for employee couples, the period of concurrent leave (i.e. unpaid parental leave taken at the same time) must not exceed 8 weeks in total; and
   
• either member of an employee couple may request an extension of unpaid parental leave, however, the extension will be reduced by any period of unpaid parental leave (other than flexible unpaid parental leave) that the other member of the employee couple has already taken.

From 1 July 2023: 

• The entitlement to flexible unpaid parental leave is now increased to 100 days (20 weeks) (or a higher number prescribed by the Fair Work Regulations 2009 (Cth)). For the avoidance of doubt, the 100 days of flexible unpaid parental leave still comes out of an employee’s entitlement to 12 months of unpaid parental leave. 

• Employees may commence flexible unpaid parental leave at any time within 24 months of the birth or adoption of a child, and it no longer:
  • needs to be taken in a single continuous period;
  • only applies after the birth of the child – a pregnant employee may take flexible unpaid parental leave in the 6 weeks prior to the expected birth of the child; and
  • requires the employee to forfeit any remaining entitlements to take continuous unpaid parental leave.

• Employee couples are no longer restricted from taking a maximum of 8 weeks of unpaid parental leave at the same time. Employee couples may also request a further extension of up to 12 months of unpaid parental leave (in addition to the original 12-month entitlement), regardless of how much unpaid parental leave the other member of the employee couple has already taken or requested.

• References to “maternity leave” are replaced with “parental leave”. 

3. Superannuation now enshrined as part of the NES

Current position: An employee’s entitlement to superannuation contributions primarily originate from the Superannuation Guarantee (Administration) Act 1992 (Cth). If an employer fails to make superannuation contributions, the only recourse for employees is through the Australian Tax Office (ATO): for the ATO to investigate an employer's super guarantee compliance on its own accord or by lodging an employee enquiry. Neither option presents an employee with a direct legal avenue to recover unpaid super.  

From 1 January 2024: Superannuation contributions will now form a part of the NES set out at section 61 of the Fair Work Act. This creates an additional statutory obligation upon employers to make super contributions under the Fair Work Act and exposes employers to civil penalties, as is the case for all breaches of the NES. 

A failure by the employer to make appropriate and timely super contributions will now enliven the right for employees to directly pursue their unpaid super as a workplace entitlement, and they may be entitled to a range of orders including compensation. Unions and the Fair Work Ombudsman will also be able to pursue unpaid super claims on an employee’s behalf, which will enhance the ability of employees to successfully recover any unpaid super from employers. 

To prevent an employee or any other entity from commencing multiple proceedings, the amendments specify that an employer will not be subject to an action made under the Fair Work Act if proceedings against the employer have already been commenced by the Commissioner of Taxation. A claim under the Fair Work Act may still be brought if the Commissioner of Taxation has engaged in other enforcement activity that does not amount to proceedings, or if the Commissioner of Taxation has discontinued the court proceedings without obtaining a final order for recovery. 

4. Workplace determinations 

Prior position: In practice, workplace determinations operate and interact with other industrial instruments as if they were enterprise agreements, with some exceptions. However, the Fair Work Act did not explicitly state that when an applicable workplace determination comes into operation, an earlier enterprise agreement will cease to apply. 

From 1 July 2023: The Fair Work Act now specifies that if an enterprise agreement applies to an employee and a workplace determination comes into effect which covers the same employee, the enterprise agreement will forever cease to apply to the employee. 

5. Authorised deductions 

Current position: The previous wording of section 324 of the Fair Work Act has the effect of requiring employers to obtain a separate written authorisation for each specific deduction if there was a variation in each amount, however negligible the variation may be. 

From 30 December 2023: To remove the administrative burden upon employers, employees may now authorise employers to make regular deductions which may vary in amount from time to time provided that the deduction is not for the employer’s benefit. 

6. Long service leave for casual workers in the black coal mining industry

Current position: Under the Coal Mining Industry (Long Service Leave Funding) Scheme, casual employees were treated differently to permanent employees when it came to long service leave entitlements.

From 1 January 2024 (unless varied by Proclamation): The Coal Mining Industry (Long Service Leave) Administration Act 1992 (Cth) and the Coal Mining Industry (Long Service Leave) Payroll Levy Collection Act 1992 (Cth) will be amended so that casual employees in the coal mining industry will no longer be treated less favourably than permanent employees. Specifically: 

• casual loading will be applied to levy payments into the Coal Mining Industry (Long Service Leave) Fund and long service leave entitlements paid by the employer;
   
• the method in which long service leave will accrue during casual employment will now be calculated in accordance with the actual hours worked per week averaged over a quarter, rather than being capped at 35 hours per week; and
   
• the Coal Mining Industry (Long Service Leave Funding) Corporation will be required to publish the levy return form publicly, and it will be available on the Federal Register of Legislation. 

Employers should take care to understand the reforms and review their existing policies, procedures and operations to ensure that it is consistent with the amendments introduced by the Protecting Worker Entitlements Act. 

If you would like further information or advice, please do not hesitate to contact a member of our Clyde & Co team.