A new employee safety net

The Federal Government recently released the proposed form of the National Employment Standard (NES) which outlines 10 basic conditions of employment for all employees. The NES is due to come into force on 1 January 2010 and represents a key plank in the Labor Government’s reform of industrial relations.

Readers may be aware that the Australian Fair Pay and Conditions Standard (AFPCS) currently stipulates terms and conditions of employment which all workers must be accorded. These relate to conditions such as a minimum of four weeks annual leave and 10 days of personal/sick leave per year. The NES goes much further than the existing AFPCS by stipulating several additional conditions.

One of the most notable additions is the right for an employee to request flexible working arrangements. A permanent employee with more than 12 months of continuous service who has responsibility for the care of a child under school age may request flexible working arrangements, such as different hours of work. The employer may only refuse a request on reasonable business grounds. It will be interesting to see how this condition will operate in reality without becoming too much of an impost on employers.

A further addition is the introduction of a mandatory redundancy payment where an employee’s employment is terminated as a result of a business restructure. Currently, employees are only entitled to redundancy pay if an industrial instrument or contract of employment provides for this. However, going forward, all employees will be entitled to receive a severance package if their position is made redundant, the quantum of which will be determined by the length of service.

By creating a more comprehensive safety net, the Labor Government is giving effect to their industrial relations policy which was released in the lead-up to the Federal elections last year. The introduction of statutory minima was an innovation of the Howard Government, and by continuing down this path, the Labor Party has implicitly acknowledged the merits of such a system.

The Labor Party deserves to be commended for developing a balanced industrial relations system which has not thrown the baby out with the bath water.