“DOs AND DON’Ts FOR WILLS AND ENDURING POWERS OF ATTORNEY”

DO:

• DO inform the person that you have appointed them executor in your will, or donee of your enduring power of attorney (epa).
• DO tell your appointees where your documents are kept and make sure they can access them (safe, key etc).
• DO keep your documents unmarked and in good condition.
• DO keep your documents in your control and possession, particularly epa’s as they are very powerful documents giving power to access your bank account, even sell property. Be careful!
• DO review your documents at least every 5 years or at major life event.
• DO be aware, both marriage and divorce void a will, separation or property settlement does not.  You can revoke, amend or make a will and epa at any time, provided you have capacity to do so.

DON’T:

• DON’T write in or mark your documents in any way; doing so will void the document.
• DON’T attach anything to your will (no paperclips, staples, pins etc) as the mark left on the document may suggest that a codicil (amendment) to the will has been removed, it may then be rejected by the Probate Registry.
• DON’T lodge epa’s in safe storage at the bank as your donee will need an epa in their hands to get it from them!

Personal Instructions

• Example:  “I would like my jewellery to go to my eldest daughter”.
• DON’T sign or date. It may raise the question ‘is this intended to be a new will?’ 
• DON’T use a computer, must be in your handwriting to show that you wrote it.
• DON’T attach to your will (see above) or insert between pages.
• DO clearly state that the instructions are not intended to be a will or codicil.
• Personal instructions are an expression of your wishes only and are not binding on your executor.

General Skilled Visa: an offshore visa

An advanced health directive must be made voluntary, the maker has to have full mental capacity, the maker has to understand the nature of the treatment and the consequences of making the decision.

Changes to Workchoices

Recently the Workchoices scheme was amended to incorporate a series of ongoing amendments to wind back the previous Workchoice legislation.   

The legislation will have the following effect:

1. Stop new AWAs from being entered into from the date the legislation takes effect.
2. Establishes interim transitional employment agreements (ITEAs) as a new form of statutory agreement (which may be entered into between the commencement of the legislation but must last no longer than 31 December 2009).
3. Repeals the fairness test and introduces what is known as a no disadvantage test.
4. Directs the Federal Industrial Relations Commission to modernise current existing awards.

LEGISLATION OF WORKPLACE AGREEMENTS

As from the commencement date, all further workplace agreements are no longer able to be entered into.  This includes any variation of the agreement.

ITEAs

These agreements provide that where an ITEA is entered into between an employer and an employee there is, a test known as a no disadvantage test. 

This means that for the agreement to be registered, there must be no disadvantage to the employee entering into an agreement and a reference agreement may be a collective agreement such as an enterprise bargaining agreement or an award or some other form of designated award.

In considering whether the agreement can be registered, the Workplace Agreements Director is also required to have regard to personal circumstances of the employee, including family responsibilities.

Where the employee stands to lose financial advantages, then consideration must be given to loss of non-monetary benefits such as days off or a beneficial shift roster.

The legislation significantly varies the AWA arrangements and significantly reinstates the role of awards.

It is to be noted that ITEAs cannot be extended beyond the date of 31 December 2009. 

FUTURE DIRECTION

ARE YOU COVERED FOR PROFESSIONAL NEGLIGENCE?

Recently, this firm had the opportunity to advise on a will which had been prepared from a do-it-yourself website for a client.  The will had been prepared by an accountant for his client.

The will was fairly complex and failed to address a number of crucial issues.

If a professional person prepares a will from a do-it-yourself website they incur a duty of care to the will maker and it is highly likely that if they were the subject of litigation they would not be covered by their professional indemnity insurance.

If the person charged a fee, however nominal, for the advice given and time taken to prepare the will then the person would be expected to have the same obligations and duty of care as a legal practitioner.

Think twice about using standard forms off a website for complex documents such as wills.  If in doubt, have a lawyer prepare the document.  A small expenditure now might save a costly legal battle later.

Commencing child related proceedings from 1 July 2007

From 1 July 2007 parties wishing to commence litigious child related proceedings in the Family Court must file with their application a duly completed certificate from a family dispute resolution practitioner. The certificate will indicate whether one or both parties attended with the family dispute resolution practitioner and either made genuine attempts or otherwise to negotiate.

Parties may seek an exemption from seeing a family dispute resolution practitioner where:

1. The court will be satisfied that there are reasonable grounds to believe that there has been (or is a risk of) child abuse or there has been (or is a risk of) family violence ; or
2. The application alleges contravention of a parenting order that was made less than 12 months ago and alleges behaviour that shows a serious disregard of obligations under that order; or
3. There is urgency; or
4. Either party is unable to participate effectively in family dispute resolution.

It is recommended that you seek legal advice prior to seeing a family dispute resolution practitioner and prior to completing an exemption form.

As of 1 June 2007 you will notice some changes in our firm.  For one thing, the partnership of Lynn & Brown will cease practising and the new company of Lynn & Brown Lawyers Pty Ltd will commence.

Andrew Lynn and Steven Brown are pleased to announce that they will be commencing the new company with Jacqueline Brown as their co-director.

We are also happy to advise that Lynn & Brown Lawyers Pty Ltd has secured the employment of all of the staff from the partnership, thus ensuring a smooth transition to the new business.

In June 2007 we will also be opening our branch office in Ellenbrook to better service our clients.

Should you wish to discuss any of these changes please do not hesitate to contact us.

Thank you for your continued support.

The husband had arranged through the solicitor for a re-finance of the family home in order to sort out his financial difficulty.  Rather than discuss the matter with his wife, he forged her signature and then took the documents to a Justice of the Peace who signed as a witness though he never met or spoke to the wife.

The solicitor was also found liable on the basis that the solicitor didn’t telephone the wife to ensure that she had seen the documentation.

The case serves as a reminder not to witness signatures unless the person is signing documents in front of you.  It also highlights the reasons why, as solicitors, we now require you to produce identification to us when signing legal documents.

IMPORTANT PUNCTUATION

A recent decision of the Canadian Radio–Television and Telecommunications Commission caused considerable commercial anguish to a party over a single comma.

Argument was raised over whether the ability to terminate a contract arose immediately or whether it could only be terminated after an initial five year period.

It was the placement of the comma which allowed the qualifying words to permit termination of the agreement immediately.

The party that wanted to enforce the agreement for the period of five years before it could be terminated is understood to have additional costs of $2.13 million as a result, according to the “Canadian Globe and Mail” report of the decision.

Getting legal documents right the first time is very important.  If you need assistance in preparing legal documents for your business, contact Lynn & Brown Lawyers.

CHANGES TO STATE LABOUR LAWS

A number of changes were made to the minimum conditions of employment and long service leave provisions for State based employees from July 2006.  These have not received a great amount of attention.

The changes to the Minimum Conditions of Employment Act centre around requirements as to the reasonableness of the hours of work and changes to leave provisions.  Sick leave is now made cumulative by way of a minimum entitlement, with any portion not used being carried forward to subsequent years.

Carer’s leave has now been extended to cover the full use of sick leave entitlement, up to a maximum of 10 days per year.

The circumstances caught within carer’s leave have been broadened also.

Bereavement leave now extends to cover the death of a grandparent or sibling as well as other immediate family members.

Long service leave changes mean that long service leave applies to provide 8 and two-third weeks of long service leave after 10 years service, with a subsequent entitlement after a further 5 years.  Employees now attain long service leave pro-rata entitlement after 7 years.

Other changes were also made in the July 2006 amendments.

OWNER DRIVER LEGISLATION

The State Government has recently introduced to Parliament a bill aimed at regulating the owner driver transport industry.

There has been considerable concern for some time that large organizations who subcontract to owner drivers are setting a rate of remuneration that is putting too much pressure on the owner driver industry.

Questions have been raised regarding the effect these cost pressures may have on drivers, such as taking excessive risks in working long hours, taking stimulants, carrying out inadequate repairs and other measures in order to try and reduce costs. 

The proposed legislation aims to set bench marks and guidelines by which the industry can operate so as to ensure a reasonable rate of pay and allow owner drivers to maintain certain standards in terms of repair and performance.

The legislation creates a new tribunal whose aim will be to supervise and encourage compliance with the standards.

PROFESSIONAL INDEMNITY INSURANCE FOR FINANCIAL PLANNERS

Professional Indemnity Insurance will become compulsory for financial planners from the commencement of next year if a draft circulated by the Federal Treasury comes into force.

Persons in the business of financial planning, advising or provision of financial services will be required to have adequate professional indemnity insurance to meet damages payments to clients.

The idea has been around since 2002, but there have been delays for various reasons.  Following the collapse of WestPoint, and the difficulties for investors seeking recourse against financial planners, the Federal Government now views the matter with some urgency.

It appears that the amount of insurance required will be based on the highest possible liability that a financial adviser may face, not from one claim, but from an aggregate of all claims.

The factors that will be taken into account are the volume and nature of the business and the number and type of clients that the financial services provider has.

Details of insurance will have to be disclosed in the advice given to clients.

PENALTIES FOR MONEY LAUNDERING

There is currently a Bill before Federal Parliament, which is intended to come into effect on 1 January 2007 if it passes through Federal Parliament in the last two sitting weeks of this year.

The intention is that the rules relating to reporting on cash transactions will be considerably strengthened.  All transactions of cash in excess of $10,000.00 will need to be reported to Austrac.

Penalties can range up to $11 million for a single act of non-compliance.

The charges which may be brought by the administrative authorities will not need to meet the normal standard of criminal prosecution, namely “beyond reasonable doubt”.  There may be civil penalties imposed instead.

The legislation will have a two year period within which there will be some “settling-in”, but after that the legislation will be vigorously enforced.

Separating from a partner can be a very difficult time.  There are many things to think about, such as where you and your partner will live, who will get what in the way of property, and, if there are children involved, what time the children will spend with each parent.

Some things that people may not think of straight away, or for a longer time after a separation, are issues such as wills, superannuation beneficiaries, life insurance beneficiaries and who, if anyone, is your attorney under an enduring power of attorney.

Currently if you marry, that will revoke any will that you may have previously made, but there is no provision for a will to be revoked upon the separation of parties, or even a divorce.  Whilst there is currently legislation before the State Parliament to introduce changes to the Wills Act to make wills invalid upon parties divorcing, this is not currently the case, and in any event it will not apply to separated married couples, or to de facto couples upon separation.

Given that many married couples may not actually divorce after a separation for quite some time it is something that people should turn their minds to upon the ending of any relationship.

Many couples make wills in favour of their partner during a relationship, and those wills can stay in effect for a number of years after the separation.  Obviously this is something that many separated couples would want to change, had they considered it.

The same applies to many other issues that people don’t often turn their minds to at the time of a separation.  Thought should be given to the named beneficiaries of a superannuation policy.  Often this is easily changed by simply contacting your superannuation fund(s) and having them send out the necessary paper work to change the beneficiaries.

Likewise, thought should also be given to the beneficiaries of any life insurance policies or of any family trusts in which the separated party has been named.

If either party has a company, even if it is not in use at the time of separation, thought may need to be given to the shareholders and directors of that company, and likewise with parties named as the proprietors of a business.  These are things that can be changed at the time of a property settlement, and if done in this way, any change in ownership should be covered by Stamp Duty exemptions pursuant to the settlement agreed reached between the parties.

Finally, people often make enduring powers of attorney in favour of a partner during a relationship.  The enduring power of attorney often operates from the time that the document is signed, unless otherwise revoked in writing.  This is a powerful document, which enables the attorney to deal with any assets of the donee of the power of attorney.

Don’t be left out in the cold - take action on these matters now.

1 July 2006 will see the introduction of new changes to the Family Law Act 1975, and the Child Support legislation, which has the potential to effect many families where a separation has occurred, or may occur after that date.

The federal government’s changes to the current position are four-fold, and can be summarised as:

Shared parental responsibility

The introduction of the concept of shared parental responsibility in matters relating to with whom children will live following the separation of married parents.  These changes relate to applications for final orders, and not interim orders.  Whilst the paramount consideration of the Court in determining with whom children should live will remain the best interests of the children, the Court will be compelled, under the new legislation, to consider whether it is practical and best for the children to spend equal time with each parent, and if not equal time, then substantial and significant time.

At this stage the changes will only relate to children of married parents, who are governed by federal law, although it is believed likely that the state will, in the near future, implement shadow legislation, so that the same provisions will apply to children of parents who have not been married.

Dispute resolution

The government is promoting resolution of disputes regarding how much time children will spend with each parent without the parties resorting to litigation, and in an attempt to make the process more child focused, by making formal dispute resolution attempts through mediators, consultants and practitioners mandatory in all but exceptional cases, before Court proceedings can be instituted by either party.

Enforcement of Court orders

The new legislation has defined in more detail what will constitute breaches of Court orders relating to time that children must spend with each parent, and provides specific sanctions for contravention of Court orders including fines, community service orders and sentences of imprisonment.

Child support changes

The changes to the legislation will be implemented over a two year period commencing in July of this year, and will include the variation of rates of payment, the ability of a parent who is making child support payments to spend more of their payments directly on the child, stronger measures to ensure that payments are made on time, and improvements in service delivery by the Child Support Agency.

Obviously this is but a very brief summary of the vast range of changes that are being implemented.  If you have any queries in relation to how these changes may affect you, we encourage you to make an appointment for specific advice for your situation.

It is not uncommon for parties to go into business with one another to operate and run a business over a period of time.

In many cases, the issues as to the operation of the trust, succession planning and dispute resolution are not covered by the unit trust agreement or constitution of the company. 

We strongly recommend in these cases that the unit trust holders or shareholders should set out between themselves a form of agreement which governs the day-to-day relationship.  It covers certain issues which need to be addressed should there be a change in ownership or one of the other areas not necessarily covered under the constitutional unit trust deed.

In summary, we think that the following key issues should be addressed:

1. Decision making – who will be responsible for making decisions and at what level?
2. The business – what is the nature of the proposed business to be carried out in the future by the parties?
3. Finance and Capital – how is the business to raise finance and how much can the parties to the business be asked to contribute capital and what sort of consents are required.
4. Transfer of participant’s interest? - What arrangements need to be made between the shareholders either to introduce a third party or in the event that one party wishes to dispose of their interest to another.  Breach and default – what consequences follow from a failure by one party in its obligations to the business to other participants?
5. Dispute resolution – what arrangements should be in place to resolve disputes in a cost effective manner without interfering with the conduct of the business.

The agreements prepared are generally straightforward and can save significant time and expense in the event of a breakdown in the relationship.  We strongly recommend them.

Significant changes have been proposed to the Wills Act in Western Australia.

The draft bill introduced into parliament on 30 March 2006 proposes some very significant changes to the Wills Act.

The changes include the following:

• The Wills Act will be amended to provide that the dissolution or annulment of a marriage will revoke a Will.  It has for many years been the case that persons marrying in Western Australia revoke their Wills by doing so, unless the Wills were expressed to be made in contemplation of their marriage.

Once the law has changed, the dissolution or annulment of a marriage (divorce) will likewise revoke a Will unless there is a clear intention to the contrary.

• Additional sections will be added to the Wills Act to assist in the interpretation of Wills.  These include an amendment to ensure that a reference to the residue of the estate will include all of the estate of the Will maker and a change to clarify that where an estate is left in parts to various persons, in the event that one of those gifts should fail the gift will, unless expressed to the contrary, be proportionately divided amongst the persons who have received the other gifts.
• A definition of a Will has been expanded so as to include electronic and other recordings of sounds, images and writings that can be reproduced.  Previously, documents stored on a computer or some recording device would not have been accepted as a Will in Western Australia.  The changes will ensure that such recordings can be proven as a Will.
• Provisions have also been included in the new laws to permit statutory Wills to be made.  This arrangement allows a person with a potential interest in an estate to refer a matter to the Supreme Court for consideration where the testator no longer has capacity to make a Will.  It means that persons lacking capacity have statutory Wills made on their behalf by a Judge of the Supreme Court who will take into account all matters raised by family and other persons potentially interested in the estate.

The intention behind this procedure is to make it easier for persons to deal with the estate after the testator’s death.  Whether this is realistic in terms of the costs that would likely be incurred in making an application will have to be seen.

• Finally, the Supreme Court will be given the power to rectify a Will where the Will does not carry out the testator’s intention due to a clerical error or some other reason.

Will makers will need to be very clear when having someone prepare their Will about what they want the Will to say.  Solicitors and estate planning advisors should take extra caution now in advising clients regarding documents prepared in anticipation of a Will.

Significant attention is being given to a recent ATO ruling in relation to deposits being taken by businesses.

The new tax ruling indicates that where deposits of 11% or more are received from a client, the full amount of the GST payable on the total supply is payable at the time of taking the deposit.

For many businesses, this means they will need to review their financial position to ensure that sufficient funds are taken up front to meet costs in the event of cancellation of orders and to comply with their cash flow objectives in meeting their tax liabilities.

Whilst the ruling is subject to review by way of test cases, businesses should take this opportunity to plan ahead and see what can be done to minimise the effect the ruling may have on them.

Some businesses may have to increase deposits significantly in order to meet an estimated liability together with the current tax liability.

For legal advice in relation to your business matters, contact Lynn & Brown Lawyers on 9375 3411.

The current Federal Government has had a long term commitment to change workplace relations.  Previously, the government has not been able to achieve this result by getting changes to pass through the Senate.

The philosophy of the current government is that the deregulation of the labour market will assist in the long term economic development of Australia.

REASONS FOR CHANGE

It is intended that employers and employees should decide workplace arrangements at a specific enterprise level.  It is felt that institutions such as Industrial Relations Commission and unions and employer associations have kept the system complicated, resistant to change and very hard to understand.

The current system is represented by a mixed arrangement of State and Federal workplace relations systems with thousands of awards which are often unclear and contradictory.  A lot of them have provisions which were established 20 to 50 years ago and enshrine the roles of the employer associations, unions, and the industrial relations commissions.

In many cases the award system is out of date and in many cases irrelevant to the modern workplace.  In many cases awards either cover employment arrangements where people are not aware of the coverage or alternatively there is no coverage where people think that they may be affected by awards.  The system is said to be rather confusing.

OVERALL EFFECT OF THE LEGISLATION

The Workchoices Legislation(“Workchoices”) recently passed will cover the workplace relations in 85% of employment arrangements.

Workchoices will bring all companies or other corporations who employ staff or who have a significant trading role.  Unincorporated sole traders and partnerships will not be covered, but will remain subject to the State system.  It is anticipated that the Act will commence in mid-March 2006 or thereabouts.

TRANSITIONAL ARRANGEMENTS

There are a number of principal transitional issues which need to be considered.

Federal Awards will operate unless replaced by an Australian Workplace Agreement or a Collective Agreement.

In terms of Federal Awards, there is a category of material which cannot be covered by an award and this is described “prohibited content”.  Where that material appears in an award it will be unenforceable.

Unincorporated associations which are currently subject to Federal Award will have 5 years within which to decide to enter into another type of Federal agreement, failing which they will revert to the State system.

All State Awards will now become Federal agreements for incorporated bodies.  There will be a period of 3 years in which employers decide what to do, failing which after 3 years the Australian Industrial Relations Commission (“AIRC”) will decide what Federal Award will apply to the particular employer.

In relation to State Awards incorporated as a Federal Award, there is again reference to “prohibited content”. This content will be unenforceable.

The Australian Fair Pay & Conditions Commission could set out certain minimum provisions of employment will override any inconsistency between those standards and any subsequent award.

Any unincorporated business covered by State Awards will continue to operate under the current arrangements.

With the transition to Federal provisions, the minimum conditions of employment legislation at State level will cease to apply to Federal employment.

In relation to State Collective Agreements, all collective agreements will become Federal Agreements for incorporated bodies.

The agreements will operate until they expire or are replaced by further collective agreements.

Again, the “prohibited content” of these agreements is unenforceable.

These agreements will not be able to be varied, but the Australian Fair Pay & Conditions Standard will not override any inconsistent provision.

Federal Collective Agreements or Workplace Agreements currently in existence will continue to operate until expiry or replaced by another agreement.  The Australian Fair Pay & Conditions Standards will override such arrangements should there be any inconsistency.

TYPES OF AGREEMENT

There will now be several types of agreements contemplated by the legislation.  These are primarily:

• Australian Workplace Agreements.
• Collective Agreements with a Union.
• Collective Agreements without a Union.
• Greenfields Collective Agreements with a Union.
• Greenfields Collective Agreements without a Union.
• Multiple business agreements, which usually generally involve franchise groups.

AUSTRALIAN FAIR PAY & CONDITIONS STANDARD

Workchoices establishes a nominal number of minimum conditions that must be met in any employment contract (registered or unregistered).

These are:

• The minimum rate of pay.
• Ordinary hours of work.
• Annual leave.
• Parental leave.

The only time the standard conditions will not apply to any contract of employment is where there is an existing Award or registered workplace agreement.

As to minimum rates of pay, these will be set by the Australian Fair Pay Commission.  It is anticipated that it will not increase the minimum rate of pay as rapidly as CPI as its criteria to determine minimum wages must take into account:

• Capacity of low paid/unemployed persons to get paid work
• Employment and competitiveness Australia wide.
• A safety net for the low paid.
• Minimum wages for junior, trainees and disabled employees.
• Employers should check minimum wages and classifications when setting employment conditions for any new employee.
• Hours worked;  normally these would be 38 hours plus reasonable additional hours of work if required by the employer.  What is reasonable in each case will have to deal with the following factors:
  • risk to employee’s health;
  • employee’s personal circumstances, including family needs;
  • general requirements of the workplace;
  • notice by the employer of the requirement to work overtime;
  • notice of the employee of his or her intention not to work additional works;
  • the employee’s previous hours over the last four preceding four weeks.

(It is strongly recommended that if an employer wishes to have an employee work more than the 38 hours in any one week, the contract of employment should include a provision to the effect that the employee may be required to work extra hours, such additional hours as required to be worked are reasonable and include a provision as to why extra hours may be required from time to time.)

AUSTRALIAN WORKPLACE AGREEMENTS

The principal agreement which the Government is clearly anxious to direct most employers and employees into is the Australian Workplace Agreement.  This will be the predominant workplace agreement under Workchoices.  The agreement must be registered by the employer with the Office of Employment Advocate and it will be an individual agreement between an employer and employee.

CONTENTS OF AGREEMENTS

There will no longer be any comparison of a workplace agreement with an Award to assess whether employees are disadvantaged by the terms of the agreement.

The only requirement that the AWA now requires is that it meets the conditions of the Fair Pay Standard set out above, i.e. it includes the following base rates of pay and casual loadings:

• 38 hours per week plus reasonable overtime;
• 4 weeks paid annual leave;
• 2 weeks paid personal leave;
• 2 days unpaid carer’s leave for each occasion of illness or emergency;
• 2 days paid compassionate leave after death or life threatening illness;  and
• 52 weeks unpaid parental leave.

Where the agreement does not meet the minimum conditions set out in the Standard, the agreement still works, but the Standard will take the place of the less favourable content in the AWA.

The agreement must also contain a term of no more than 5 years from the date of commencement of the agreement.

It must also include a dispute settlement procedure for disputes between the employer and the employee.

Where the agreement does not make provision on certain matters then provision in an otherwise applicable Award will be included in the agreement.  These will include the following:

• Rest breaks;
• Incentive bonus payments;
• Annual leave loading;
• Public holidays and entitlements;
• Allowance for work expenses, skills or work conditions;
• Loadings for overtime, penalty rates, out worker conditions and other matters prescribed by regulations.

An agreement may not include prohibited content.  Although prohibited content still remains unclear it is anticipated it will cover the following items:

• A provision to the effect that no AWA is allowed in the workplace.
• Any attempt to restrict the use of independent contractors or on-hire arrangements.
• Permitting strike or other industrial action while the agreement is in place.
• Making Union involvement compulsory in a dispute.
• Giving a remedy for unfair dismissal.

There are significant penalties for including provisions relating to a prohibited conduct in an AWA.

PROCEDURE FOR MAKING AWA’s

Seven days prior to being asked to approve the AWA an employer must give the employee:

• access to a copy of the proposed agreement;  and
• the information statement prepared by the Office of the Employment Advocate (“OEA”).

If the agreement purports to include the terms of award or industrial instrument then access must be also provided to that.

Penalties apply if the agreement was not provided.

NEGOTIATING A WORKPLACE AGREEMENT

Where an employee is negotiating an AWA they may appoint a person to be their bargaining agent to confer with the employer about the agreement.

APPROVING A WORKPLACE AGREEMENT

An AWA is approved when it is signed and dated by the employer and employee.

Both signatures must be witnessed.

Different provisions apply where a collective agreement is entered into and strict procedures must be followed.

LODGING A WORKPLACE AGREEMENT

Once approved by both parties, the agreement must be lodged with the OEA together with a statutory declaration. 

It must be lodged within 14 days and it must be lodged within time or penalties will apply if it is not lodged within the 14 days.  The OEA does not look at the procedural content required for agreements under the Workchoices Legislation.

NON COMPLIANCE TO DEAL WITH THE APPLICATION OF PENALTIES

A Court has the power to declare an agreement void if it breaches the Workchoices Legislation.

COMMENCING OPERATION OF WORKPLACE AGREEMENTS

Agreements will commence operation on the date of lodgement at the OEA.

An agreement only ceases if it is:

• terminated;
• replaced by another agreement;
• declared void by a Court.

A workplace agreement runs for a period of up to 5 years.

VARIATION OF A WORKPLACE AGREEMENT

Varying an agreement involves a similar process to making an agreement, namely:

• 7 days ready access to the variation;
• obtaining approval for the variation;
• lodging the variation with the OEA within 14 days of approval.

Variation commences operation on lodgement with the OEA.

TERMINATION OF WORKPLACE AGREEMENT

An AWA may be terminated at any time in the following manner:

• Being told by one party there is an intention to terminate the agreement and being given the information statement for the OEA for a period of 7 days.
• Obtaining approval from the other party for termination.
• Lodging termination notice of agreement with OEA within 14 days of acceptance of termination.

After the passing of the expiry date in an AWA, an agreement may be terminated by a party to the agreement by:

• giving parties bound by the agreement 90 days notice of intention to terminate;  and
• lodging a declaration to terminate the agreement with the OEA.

Where a workplace agreement under the new system is terminated and not replaced, then the minimum terms and conditions of employment for employees will revert to the Australian Fair Pay Standards plus any undertakings, if any, given by the employer.

APPLICATION OF AWARDS AND AWA’s

The AWA is an instrument which can be used to vary or contract out of the terms of an applicable award.

Where an award may provide a provision which the employer wishes to contract out of then the employer can use an AWA to that effect.

IMPORTANT POINTS TO NOTE

Workchoices makes it an offence to coerce another person to make or vary an AWA or vary any other form of agreement or to appoint or remove a bargaining agent.

To offer an AWA as a condition of employment is not duress.

It is an offence to disclose that a person is a party to an AWA.

In some circumstances the employer is prohibited from paying the employee where there is industrial action taken.

BENEFITS AND DRAWBACKS OF AWA’s

There is no more disadvantage tests save that so long as any new agreement complies with the Fair Pay & Conditions Standard then the workplace agreement will be valid.

UNFAIR DISMISSALS AND REDUNDANCY PAY:-

The substitution of an AWA for an award creates a situation where an employer may contract out of payment of redundancy.  This is an award entitlement generally and may not be included in agreements made under Workchoices.

REGISTRATION WITHOUT REVIEW:-

Agreements will be registered without the need to be scrutinised and approved by an independent agency and to that extent agreements now lodged with the Employment Advocate will take effect irrespective of whether they comply with a number of requirements set out in the legislation.

POTENTIAL LOOPHOLES – PROHIBITED CONTENT:-

Whilst certain provisions included in workplace agreements may be prohibited, it appears that some Unions have asked employers to enter into deeds of agreement, which may be a means to circumvent prohibited content.  There is some question as to whether the Workchoices Legislation does not apply to unregistered agreements.  It is also unclear as to whether Workchoices extends to employer policies so that if content is prohibited, it may be validly contained in policies of the employer.

PROTECTION OF KEY AWARD CONDITIONS:-

Workchoices Legislation currently includes conditions for employees which are covered in awards and unless specifically excluded will still bind the employer.

UNREGISTERED AGREEMENTS

If an employee does not wish to enter into an Australian Workplace Agreement then he is still able to have a contract of employment with his employer.

With the removal of the provisions relating to unfair dismissal and the conditions set by award it may be unclear as to what particular provisions apply in the event of a dispute between an employer and employee.

There is strong comment by experts in the area that there will be resort to Courts if there is dispute about the terms of the contract.

In the area of discipline and dismissal, it is more likely that there will be claims that an employee was dismissed on the basis of discrimination or on the grounds of other provisions relating to unlawful termination.

To avoid this type of claim, clear dismissal procedures should still be documented and recorded.

Anti-discrimination policies should be comprehensive, up to date and clearly set out to employees.

The contract of employment should provide that an employee will be required to know and observe the terms of the employer’s anti-discrimination policy.

It may be appropriate to have in any contract of employment:

• the key employer requirements and consequences of not achieving or observing these;
• a performance management policy which sits alongside the employment contract.

It is likely that anti-discrimination tribunals will look at employers’ disciplinary procedures to consider whether they are fair or otherwise.

Adequate provisions as to notice need to be included.  Where an extremely highly paid employee is dismissed without adequate notice that person may seek legal damages on the basis that the period of notice is inadequate.  In some cases up to 12 months notice may be sought.

Other areas which have become contentious over recent years are as follows:

• approaching staff or clients after ceasing employment;
• use of knowledge acquired during the period of employment;
• lack of clarity as to employee’s specific duties;
• breakdown of salary and superannuation and the overall apportionment;  and
• any other special conditions which pertain to the employee’s industry such as drug testing, special allowances?

UNLAWFUL DISMISSAL

The rules relating to unfair dismissal will be significantly changed by the legislation.

Currently claims for unfair dismissal can be lodged either in the State or the Federal jurisdiction and dependent on whether the employer is covered a State or Federal Award.

The position will significantly change for anyone employed by a corporation from the commencement of the legislation.

It is now provided that where an employee works for an employer with less than 100 staff they will be excluded from lodging unfair dismissal claims.

The number of employees will be based on a head count for the preceding 12 months.

Employers will not be allowed to restructure so that they have separate businesses under the 100 employee limit.

The significant effect of the legislation will be to ensure that employees will not have access to unfair dismissal claims in the Industrial Commission.

Employees of employers with more than 100 employees will be able to still bring dismissal claims, but th