House of Representatives

Explanatory Memorandum

(Circulated by authority of the Treasurer, the Hon. Josh Frydenberg MP)

Chapter 1 Amendment of the Fair Work Act 2009

Outline of chapter

1.1 Schedule 1 to this Bill amends the Fair Work Act to support the practical operation of the JobKeeper scheme in Australian workplaces in the national system and keep Australians employed.

Context of amendments

1.2 The JobKeeper scheme will help employers who qualify for the JobKeeper scheme retain staff during the downturn caused by the Coronavirus pandemic and support business recovery when conditions improve. JobKeeper payments are payable to qualifying employers for a maximum of 13 fortnights in respect of each eligible employee on their books on 1 March 2020 who is retained by the employer. Qualifying employers will receive a payment (fortnightly in arrears) of $1,500 per fortnight for each eligible employee.

Summary of new law

1.3 Part 1 of Schedule 1 to this Bill inserts new Part 6-4C into the Fair Work Act, which temporarily enables employers to issue JobKeeper enabling directions. These can provide (subject to various safeguards) for increased flexibility around employees' hours of work via a new JobKeeper enabling stand down direction, performance of duties and location of work. It also enables employers and employees to make agreements for increased flexibility around annual leave arrangements and days and times of work. The FWC will be able to resolve disputes, including by arbitration.

1.4 New Part 6-4C also requires JobKeeper qualifying employers to meet minimum payment obligations to employees who are subject to these arrangements, including by ensuring that at least the value of JobKeeper payments they receive through the Commissioner is passed on to such employees each fortnight, or the amount they would receive for the work they have performed if that would be greater.

1.5 New Part 6-4C also contains:

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rules about accrual of service and calculation of benefits in certain circumstances; and

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rules about its interaction with other laws.

1.6 The amendments made by Part 1 of Schedule 1 to this Bill will enable the greatest number of workplaces in the national workplace relations system to access and make best use of the Jobkeeper scheme, with a view to preserving the greatest number of jobs.

1.7 These amendments are time-limited and will automatically be repealed by Part 2 of Schedule 1 on 28 September 2020.

Detailed explanation of new law

Schedule 1 - Amendment of the Fair Work Act 2009

Item 1 - Subsection 539(2) (at the end of the table)

1.8 This item inserts new items 39, 40 and 41 into the table in subsection 539(2) of the Fair Work Act to provide rules about standing, jurisdiction and penalties for contravention of sections 789GD, 789GDA(2), 789GDB(2), 789GDB(3), 789GU, 789GW and 789GXA (explained below), which are civil remedy provisions.

1.9 Contravention of section 789GD, which is about an employer's obligation to satisfy the wage condition set out in the JobKeeper payment rules, could amount to a serious contravention that can carry a penalty of up to 600 penalty units (see section 557A of the Fair Work Act). A maximum civil penalty of 600 penalty units also applies to an employer who knowingly misuses a purported job keeper enabling direction that is not authorised by new Part 4-6C (section 789GXA).

Item 2 - At the end of subsection 576(1)

1.10 Item 2 of Schedule 1, Part 1 amends subsection 576(1) of the Fair Work Act to provide that the FWC has functions conferred in relation to the Coronavirus economic response provided for in new Part 6-4C of the Fair Work Act.

Item 3 3 - After paragraph 675(2)(j)

1.11 Item 3 of Schedule 1, Part 1 amends subsection 675(2) of the Fair Work Act to provide that a person does not commit an offence if they contravene an FWC order under new Part 6-4C.

Item 4 - At the end of subsection 716(1)

1.12 Item 4 amends subsection 716(1) to enable an inspector to issue a compliance notice for contravention of a provision of Part 6-4C, a JobKeeper enabling direction or a provision of an agreement authorised by Part 6-4C.

Item 5 - Part 6-4C-Coronavirus economic response.

Section789GA (Guide to Part 6-4C)

1.13 Item 5 of Schedule 1, Part 1 inserts new Part 6-4C into the Fair Work Act.

1.14 New section 789GA provides the Guide to Part 6-4C, which notes that the Part's purpose is to assist employers who qualify for the Jobkeeper scheme to deal with the economic impact of the Coronavirus pandemic.

1.15 Part 6-4C also authorises an employer who qualifies for the JobKeeper scheme to give a:

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JobKeeper enabling stand down direction to an employee (including to reduce hours of work);

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direction to an employee about the duties to be performed by the employee, and

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direction to an employee about the location of the employee's work.

1.16 The Part also authorises an employee who qualifies for the JobKeeper scheme and an employee to make agreements in relation to the days or times of work, and taking paid annual leave, including at half pay.

1.17 The Guide also notes that:

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an employer must consult the employee (or a representative of the employee) before giving a direction;

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directions must (among other things) not be unreasonable in all of the circumstances, and directions in relation to duties to be performed by an employee or their location of work must be supported by an employer's reasonable belief this is necessary for the continued employment of one or more employees of the employer;

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safeguards apply in relation to directions, including that new Part 6-4C operates at all times subject to particular listed laws (which contain other safeguards), and

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the FWC may deal with disputes about the operation of Part 6-4C.

Section 789GB (Object)

1.18 Section 789GB provides the object of Part 6-4C, which is to:

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make temporary changes to assist the Australian people to keep their jobs, and maintain their connection to their employers, during the unprecedented economic downturn and work restrictions arising from:

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the Coronavirus pandemic; and

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government initiatives to slow the transmission of Coronavirus;

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help sustain the viability of Australian businesses during the COVID-19 pandemic, including by preparing the Australian economy to recover with speed and strength after a period of hibernation;

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continue the employment of employees;

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ensure the continued effective operation of occupational health and safety laws during the Coronavirus pandemic; and

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help ensure that, where reasonably possible, employees:

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remain productively employed during the Coronavirus pandemic, and

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continue to contribute to the business of their employer where it is safe and possible for the business to continue operating.

Section 789GC (Definitions)

1.19 This provision sets out definitions for Part 6-4C, as follows:

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designated employment provision - which refers to:

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a provision of the Fair Work Act (other than a provision of new Part 6-4C or a provision mentioned in section 789GZ);

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a fair work instrument (see section 12);

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a contract of employment; or

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a transitional instrument.

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employee and employer - these are references to the definitions of national system employer and national system employee (see sections 13, 14, 30C, 30D, 30M and 30N of the Fair Work Act, which engage Commonwealth constitutional powers including the corporations power (s51(xx)) and the power to legislate with respect to matters referred by States (s51(xxxvii)).

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fortnight - which means a 14-day period beginning on a Monday.

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hourly rate of pay guarantee - which has the meaning given by section 789GDB.

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jobkeeper enabling direction - which means a direction authorised by sections 789GDC, 789GE or 789GF.

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jobkeeper fortnight - which has the same meaning as in the jobkeeper payment rules.

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jobkeeper payment - which means the jobkeeper payment payable by the Commonwealth in accordance with the jobkeeper payment rules.

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jobkeeper payment rules - which means the rules made under the Coronavirus Economic Response Package (Payments and Benefits) Act 2020.

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jobkeeper scheme - which has the same meaning as in the jobkeeper payment rules.

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licence - which includes registrations and permits.

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minimum payment guarantee - which has the meaning in section 789GDA.

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qualifies for the jobkeeper scheme - which has the same meaning as in the jobkeeper payment rules.

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wage condition - which means the wage condition set out in the JobKeeper payment rules.

Division 2 - Employer payment obligations

Section 789GD (Obligation of employer to satisfy the wage condition)

1.20 Sections 6(1)(d) and 10 of the JobKeeper payment rules require the sum of amounts paid (or otherwise handled in ways permitted by those rules, such as by making salary sacrifice superannuation contributions for employees or withholding tax amounts) by an employer who is entitled to a JobKeeper payment for an individual for a fortnight, to equal or exceed $1,500 in the fortnight (this is the wage condition of the JobKeeper payment rules).

1.21 New section 789GD requires an employer that qualifies for the JobKeeper scheme, and would be entitled to the JobKeeper payment for a particular employee by satisfying the wage condition in respect of that employee, to ensure the wage condition is in fact satisfied by the end of the fortnight. This effectively requires the employer to pay their employee (or otherwise deal with amounts in ways permitted by the JobKeeper payment rules) the fortnightly value of the JobKeeper payment.

1.22 Section 789GD is a civil remedy provision enforceable under Part 4-1 of the Fair Work Act, which provides access to the courts for (among other things) penalty and compensation orders to remedy contraventions upon application by an employee, employee representative or an inspector.

1.23 Note 2 to section 789GD makes it clear that under the JobKeeper payment rules, a JobKeeper payment is a payment to an employer for a particular employee for a fortnight.

Section 789GDA (Minimum payment guarantee)

1.24 Section 789GDA requires an employer who is eligible for the Jobkeeper scheme to ensure the total amount payable to a particular employee in respect of a fortnight is either:

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the amount of the JobKeeper payment for the employee; or

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if a greater amount is payable to the employee for the performance of work during the fortnight, that amount (in full).

1.25 Subsection 789GDA(2) is a civil remedy provision enforceable under Part 4-1 of the Fair Work Act, which provides access to the courts for (among other things) penalty and compensation orders to remedy contraventions.

Section 789GDB (Hourly rate of pay guarantee)

1.26 A JobKeeper enabling stand down direction cannot reduce an employee's hourly base rate of pay. Section 789GDB(2) requires an employer who is eligible for the JobKeeper scheme to ensure that where an employee is given a JobKeeper enabling stand down direction under section 789GDC, the employee's base rate of pay worked out on an hourly basis is not less than the base rate of pay worked out on an hourly basis that would have applied to the employee if the direction had not been given.

1.27 Section 789GDB(3) similarly requires an employer who is eligible for the JobKeeper scheme to ensure that where an employee is given a direction about their work duties under section 789GE, the employee's hourly base rate of pay is not less than the greater of:

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the base rate of pay on an hourly basis that would have applied if the direction had not been given; or

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the base rate of pay on an hourly basis applicable to the duties performed.

1.28 This effectively means that an employee's hourly rate cannot be reduced as a result of a JobKeeper enabling direction.

1.29 Subsections 789GDB(2) and 789GDB(3) constitute the hourly rate of pay guarantee (subsection 789GDB(1)).

1.30 Section 789GDB(4) provides that if an employee is paid otherwise than on an hourly basis (or by reference to an hourly pay rate) and an applicable workplace instrument specifies the employee's base rate of pay for the purposes of the NES or sets a method for working out the employee's base rate of pay for that purpose, the employee's base rate of pay is:

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the amount specified in that instrument, or

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the amount worked out using that method (as the case requires).

1.31 This is designed to ensure that employees paid other than by reference to hours, such as on an annualised salary arrangement, have clear rules for how their pay arrangements are treated for the purpose of the hourly rate of pay guarantee.

1.32 Subsections 789GDB(2) and 789GDB(3) are civil remedy provisions enforceable under Part 4-1 of the Fair Work Act, which provides access to the courts for (among other things) penalty and compensation orders to remedy contraventions.

Division 3 - Jobkeeper enabling stand down

Section 789GDC (Jobkeeper enabling stand down)

1.33 Sections 789GDC relates to Jobkeeper enabling standing down.

Division 4 - Duties, location and days of work

Section 789GE (Duties of work)

1.34 Sections 789GE relates to duties of work.

Section 789GF (Location of work)

1.35 Sections 789GF relates to location of work.

Section 789GG (Days of work etc.)

1.36 Sections 789GF relates to days of work.

Division 5 - Taking paid annual leave

Section 789GJ (Taking paid annual leave)

1.37 Designated employment provisions may contain:

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restrictions on the type of work an employee may perform (for example, because of the employee's classification or qualification);

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limitations on when or where work may be performed, or requirements for minimum hours of work; or

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circumstances in which annual leave may be taken.

1.38 These conditions may prevent or restrict an employee's capacity to be available for necessary work in circumstances that arise because of the Coronavirus pandemic, or an employer's capacity to direct an employee to work in a different location in response to those circumstances.

1.39 If an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for a particular employee, Divisions 3 and 4 of Part 6-4C temporarily authorise that employer, despite any limitations in a designated employment provision, to:

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give a JobKeeper enabling stand down direction to work fewer days or hours to an employee who cannot usefully be employed for the employee's normal days or hours during the JobKeeper enabling stand down period because of business changes attributable to the Coronavirus pandemic or government initiatives (including Commonwealth, State or Territory Government initiatives) to slow Coronavirus transmission (section 789GDC), and

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give a direction to an employee about the nature of the employee's duties, within their skill and competency (section 789GE) or to perform duties at a place different from their normal place of work, including the employee's home (section 789GF).

1.40 These are JobKeeper enabling directions (definition in section 789GC refers). To be clear, a JobKeeper enabling direction can only be given to an employee by an employer who qualifies for the JobKeeper payment scheme in relation to that employee. While a JobKeeper enabling direction must inherently be given to an employee before the period to which it relates, and a JobKeeper payment is made in arrears, JobKeeper enabling directions are ultimately only valid if the JobKeeper payment is ultimately made to the employer in relation to that employee.

1.41 If an employer qualifies for the Jobkeeper scheme and is entitled to JobKeeper payments for a particular employee, Divisions 4 and 5 of Part 6-4C also enable that employer and employee, despite any limitations in a designated employment provision, to agree to the employee:

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working different days or at different times compared with the employee's ordinary days or times of work (section 789GG), or

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taking paid annual leave, including at half pay (section 789GJ).

1.42 The provisions would facilitate a range of flexible arrangements to support continuing business operation and the ongoing employment of employees.

1.43 A direction under sections 789GDC, 789GE or 789GF, or an agreement between an employer who qualifies for the Jobkeeper scheme and an employee under sections 789GG or 789GJ, have the effect of temporarily modifying employment rights and obligations to the extent specified in the direction or agreement. These arrangements can only be made in relation to the specific matters set out in sections 789GDC to 789GJ, and in accordance with other requirements set out in Part 6-4C.

1.44 Terms and conditions of an employee's employment beyond the scope of any JobKeeper enabling directions or agreements that have been given or agreed to by that employee will not be affected. If no such direction or agreement is made, existing rights and obligations (which may be derived from the Fair Work Act, a fair work instrument, contract of employment or transitional instrument) continue to apply.

1.45 In other words, an employee's terms and conditions of employment continue to apply, except to the limited extent modified by a JobKeeper enabling direction or agreement.

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For example, if an enterprise agreement permits an employer to change employee rosters following consultation, those terms continue to apply if no JobKeeper enabling direction is given about fewer days or hours of work. The employer would still be able to change rosters in accordance with the enterprise agreement.

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However, if the employer (who is eligible for the Jobkeeper scheme) gives a JobKeeper enabling direction that reduces an employee's hours of work via a JobKeeper enabling stand down direction, the direction applies despite any otherwise applicable enterprise agreement terms for the duration of the direction.

1.46 Part 6-4C does not modify terms and conditions of employment unless an employer who is eligible for the JobKeeper payment scheme makes a JobKeeper enabling direction or agreement. This is the case even where an employer qualifies for and makes payments to an employee under the Jobkeeper scheme but does not give a direction or make an agreement. That is:

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an employer can only make a JobKeeper enabling direction or agreement if they qualify for the JobKeeper scheme and are entitled to JobKeeper payments for the employee in respect of whom the JobKeeper enabling direction or the agreement relates; but

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if no JobKeeper enabling direction or agreement is made, existing rights and obligations are unaffected.

Section789GDC (Requirements for JobKeeper enabling stand down direction)

1.47 Section 789GDC sets requirements for the giving of a JobKeeper enabling stand down direction by an employer (who qualifies for the JobKeeper scheme in relation to a particular employee) to that employee. A JobKeeper enabling stand down direction may require the employee not to work on particular days, or to work for a lesser period or for fewer hours than the employee would ordinarily work (including nil hours). A JobKeeper enabling stand down direction has effect despite a designated employment provision to the extent of any inconsistency.

1.48 The direction may be given if an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for the employee to whom the direction is given, and if:

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the employee cannot be usefully employed for their normal days or hours during the JobKeeper enabling stand down period because of changes to business attributable to the Coronavirus pandemic or government initiatives to slow Coronavirus transmission, and

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it can be implemented safely, having regard (without limitation) to the nature and spread of Coronavirus).

1.49 Changes to business could include, for example, less patronage and the closing of stores.

1.50 Subsection 789GDC(2) provides that while a JobKeeper enabling stand down direction is in place, the employer is still required to comply with:

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the wage condition in section 789GD;

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the minimum payment guarantee in section 789GDA; and

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the hourly rate of pay guarantee in section 789GDB;

but is not otherwise required to make payments to the employee in respect of the JobKeeper enabling stand down period.

1.51 An employee does not have to comply with a JobKeeper enabling stand down direction if it is unreasonable in all the circumstances (section 789GK).

Example 1.1

Jo is employed as a waiter in Anna's restaurant. Anna's restaurant has reduced operations to takeaway only because of Coronavirus restrictions. Anna qualifies for the JobKeeper scheme in relation to Jo, and gives Jo a JobKeeper enabling stand down direction not to attend work for 4 weeks, compared to her usual roster of 40 hours per week.

Anna is required to ensure Jo is paid the appropriate value of JobKeeper payments ($3000) during the four week JobKeeper enabling stand down period (section 789GD, which contains the wage condition obligation).

Example 1.2

Rachel works as an administrator for a manufacturing business whose retail operations have moved online as a result of significantly reduced shopfront demand and a 30 per cent reduction in turnover, following the Coronavirus outbreak. Rachel's employer qualifies for the JobKeeper scheme in relation to Rachel and gives her a JobKeeper enabling stand down direction under section 789GDA that reduces her ordinary hours of work from 38 to 32 hours per week. Rachel's contractual base pay rate is $30 per hour, which cannot be reduced for her hours of work, regardless of how many hours she is directed to work (section 789GDB, which contains the hourly rate of pay guarantee).

As a result of the JobKeeper enabling stand down direction reducing her hours, Rachel's fortnightly pay has reduced from $2280 ($30/hr multiplied by 76 hours worked in a fortnight) to $1920 ($30/hr multiplied by 64 hours worked in a fortnight).

Rachel must be paid for hours she worked, and as her reduced fortnightly pay is still higher than the value of the fortnightly JobKeeper payment ($1500) she must be paid that higher amount (section 789GDA, which contains the minimum payment guarantee).

However, under the JobKeeper scheme, Rachel's employer can apply the value of the JobKeeper payment towards her fortnightly pay.

1.52 A jobKeeper enabling stand down direction does not apply while an employee is taking paid or unpaid leave authorised by the employer (for example, annual leave), or is otherwise authorised to be absent (for example, on a public holiday).

Section 789GE (Requirements for duties of work direction)

1.53 Section 789GE sets requirements for an employer (who qualifies for the JobKeeper scheme in relation to a particular employee) to be able to direct that employee during a period to perform any duties within their skill and competency. A direction relating to duties of work has effect despite a designated employment provision to the extent of any inconsistency.

1.54 The direction may be given if an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for an employee, and if:

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the duties are safe (having regard, without limitation, to the nature and spread of Coronavirus);

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the employee is licensed and qualified to perform the duties (if a licence or qualification is necessary); and

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the duties are reasonably within scope of the employer's business operations.

1.55 An employee does not have to comply with a direction to change duties of work if it is unreasonable in all the circumstances (section 789GK).

Example 1.3

Ameisa operates a warehouse in NSW. The Storage Services and Wholesale Award 2010 applies to the employees of the warehouse, including Meera. As a storeworker grade 4, Meera generally acts in a leading hand capacity, coordinating the work of other storeworkers, performs liaison duties including with customers, and controlling inventory.

Ameisa's business is affected by the Coronavirus pandemic and qualifies for the JobKeeper scheme. Given the downturn in Ameisa's business operations, Meera is not required to perform her usual duties in respect of customer liaison. In order to keep Meera connected to employment during the pandemic, rather than reducing Meera's hours, Ameisa gives Meera a JobKeeper enabling direction that changes Meera's usual duties and enables her to be retain her regularly rostered hours, albeit in other duties.

Ameisa wants Meera to drive a forklift in the warehouse. Because the duties can be performed with appropriate social distancing and in a way that is safe with respect to the nature and spread of Coronavirus, reasonably within the scope of Ameisa's business operations, and Meera holds a current high risk work licence to operate a forklift (class LO), Ameisa is able to give a JobKeeper enabling direction authorised by s 789GE to drive the forklift.

While Meera's duties have been modified by the JobKeeper enabling direction, the other terms and conditions relating to her employment, such as the days and hours she works, are unchanged.

Section 789GF (Requirements for location direction)

1.56 Section 789GF sets requirements for an employer (who qualifies for the JobKeeper scheme in relation to a particular employee) to be able to direct that employee during a period to perform duties at a place (including the employee's home) that is different from the employee's normal workplace. A direction relating to location of work has effect despite a designated employment provision to the extent of any inconsistency.

1.57 The direction may be given if an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for an employee, and if:

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the place is suitable for the employee's duties;

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if the place is not the employee's home - it does not require the employee to travel a distance that is unreasonable in all the circumstances (including those surrounding the Coronavirus pandemic); and

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performance of the employee's duties at the place is safe, having regard (without limitation) to the nature and spread of Coronavirus, and is reasonably within scope of the employer's business operations.

1.58 A direction to change work location does not apply to an employee if it is unreasonable in all the circumstances, including where it impacts on caring responsibilities of an employee (section 789GK).

Section 789GG (Requirements for days / time of work agreement)

1.59 Section 789GG facilitates an employer who qualifies for the JobKeeper payment scheme in relation to a particular employee and that employee to be able to agree (despite any designated employment provision) to the employee performing work on different days or at different times during a period, compared with the employee's ordinary days or times of work.

1.60 The agreement is authorised if an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for the employee, and if:

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performance of the duties on different days or at different times is safe, having regard (without limitation) to the nature and spread of Coronavirus and reasonably within the scope of the employer's business operations, and

•

the agreement does not reduce the employee's number of hours of work compared with the employee's ordinary hours of work (reduced hours can only be effected under section 789GDC).

1.61 An employee must consider and must not unreasonably refuse the employer's request for agreement to the changed arrangements. An agreement to work different days or times would need to be agreed by an employee, but in the absence of agreement the FWC could settle a dispute about this by arbitration (Division 10).

1.62 The circumstances of particular workplaces would inform what is reasonable in this area. For example, an employee who usually works weekends could reasonably be required to work on weekdays in a situation where their employer's business can no longer trade on weekends as a result of the Coronavirus pandemic.

1.63 An employee's ordinary hours of work during the period to which an agreement under subsection (2) relates are the hours of work provided for in that agreement.

Section 789GJ (Taking paid annual leave)

1.64 Section 789GJ facilitates an employee (whose employer qualifies for the JobKeeper payment scheme in relation to them) to consider their employer's request to take paid annual leave and to agree (despite any designated employment provision) to take annual leave at half pay.

1.65 If an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for an employee, an employee must consider (and must not unreasonably refuse) their employer's request to take annual leave, provided that the leave arrangement would not result in reducing the employee's leave balance to fewer than two weeks. If the employee does not agree to the request, the FWC could settle a dispute about this by arbitration (see Division 10).

1.66 If an employer qualifies for the JobKeeper scheme and is entitled to JobKeeper payments for an employee, the employer and employee can also agree (despite any designated employment provision) to the employee taking twice as much annual leave at half the employee's rate of pay for a period.

Division 6 - Rules relating to JobKeeper enabling directions

Section 789GK (Reasonableness), section 789GL (Continuing the employment of employees), section 789GM (Consultation), section 789GN (Form of direction), section 789GP (Duration) and section 789GQ (Compliance)

1.67 Division 6 provides general rules for an employer's JobKeeper enabling direction to an employee:

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Any direction must not be unreasonable in all the circumstances (this could, for example, depend on its impact on an employee's caring responsibilities). If a direction is unreasonable in all the circumstances, it does not apply to an employee (section 789GK).

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In addition to the reasonableness test in section 789GK, in the case of a direction for changed duties (s 789GE) or work location (s 789GF), the employer has information to support a reasonable belief the direction is necessary to continue the employment of one or more employees (and in this context it is immaterial that the employer could have given a similar direction to another employee) (section 789GL).

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The employer must give the employee at least three days written notice of the intention to give a direction or lesser period by genuine agreement (although this does not apply if the employer previously provided such notice of the direction and considered any views of the employee in that context), consult the employee or the employee's representative about it, and keep a written record of the consultation (section 789GM).

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The direction must be in writing (this could include by electronic means). The regulations may prescribe a form for the direction (section 789GN).

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The direction continues in effect until withdrawn or revoked by the employer, or replaced by a new direction given to the employee - this is subject to any FWC order under Division 11 and to cessation of the direction at the start of 28 September 2020 (section 789GP).

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An employee given a JobKeeper enabling direction by their employer must comply with the direction (section 789GQ).

Divisions 7 (Service) and Division 8 (Accrual rules)

Section 789GR (Service) and section 789GS (Accrual rules)

1.68 Sections 789GR and 789GS provide that:

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during a period when an employee is subject to a JobKeeper enabling direction, the period counts as service (this is in addition to the effect of section 22 of the Fair Work Act, which provides general rules about service) (section 789GR);

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an employee who is subject to a JobKeeper enabling stand down direction under section 789GDC accrues leave entitlements as if the direction had not been given, and any entitlements to redundancy pay and payment in lieu of notice of termination are to be calculated as if the direction had not been given (subsections 789GS(1) and (2)); and

•

an employee who takes annual leave at half pay in accordance with an agreement under subsection 789GJ(2) accrues leave entitlements as if the direction had not been given, and any entitlements to redundancy pay and payment in lieu of notice of termination are to be calculated as if the direction had not been given (subsections 789GS(3) and (4)).

1.69 Periods to which agreements made under sections 789GG or 789GJ apply will count for service and accrual of entitlements as they normally would under section 22 of the Fair Work Act.

Division 9 - Employee requests for secondary employment, training etc.

Section 789GU (Employee requests for secondary employment, training)

1.70 An employee could ask their employer who qualifies for the JobKeeper payment scheme in a range of circumstances for permission to engage in reasonable secondary employment, training or professional development. If an employee who is subject to a JobKeeper enabling stand down direction under section 789GDC makes such a request, section 789GU requires the employer to consider and not unreasonably refuse such requests.

1.71 Section 789GU is a civil remedy provision enforceable under Part 4-1 of the Fair Work Act, which provides access to the courts for (among other things) penalty and compensation orders to remedy contraventions.

Division 10 - Dealing with disputes

Section 789GV (FWC may deal with a dispute about the operation of this Part) and section 789GW (Contravening an FWC order dealing with a dispute about the operation of this Part)

1.72 Division 10 enables the FWC to settle disputes about the operation of Part 6-4C. Section 789GV authorises the FWC to deal with a dispute by arbitration (in addition to its powers under section 595 to deal with disputes by mediation or conciliation etc.), and permits it to make:

•

an order it considers desirable to give effect to a JobKeeper enabling direction;

•

an order setting aside, or substituting, a JobKeeper enabling direction; or

•

any other order it considers appropriate.

1.73 Consistent with other provisions that authorise the FWC to deal with disputes by arbitration (such as section 526 in relation to disputes about stand down), the FWC must take into account fairness between the parties to the dispute.

1.74 An application to the FWC to deal with a dispute may be made by an employee or an employee organisation, or an employer or an employer organisation.

1.75 Section 789GW provides that a person must not contravene a term of an FWC order dealing with a dispute about the operation of Part 6-4C. Section 789GW is a civil remedy provision enforceable under Part 4-1 of the Fair Work Act.

1.76 Item 3, Part 1 of Schedule 1 to the Bill amends subsection 675(2) of the Fair Work Act to extend the current list of FWC orders that do not attract liability for an offence to include FWC orders under new Part 6-4C.

Division 11 - Exclusions

Section 798GX (Exclusions)

1.77 This provision is a limited regulation making power. It only enables the Minister, by legislative instrument, to exclude one or more specified employers from the operation of any or all provisions that authorise a JobKeeper enabling direction or agreement (that is, sections 789GDC, 789GE to 789GJ inclusive). This might be done in circumstances where (for example) an employer contravenes a civil remedy provision.

Division 12 - Protections

Section 789GXA (Misuse of JobKeeper enabling direction)

1.78 Section 789GXA prohibits an employer from purporting to give a JobKeeper enabling direction if the direction is not authorised by Part 6-4C and the employer knows that the direction is not authorised.

1.79 Section 789GXA is a civil remedy provision enforceable under Part 4-1 of the Fair Work Act, and carries a maximum penalty of 600 penalty units.

Section 789GY (Protection of workplace rights)

1.80 Section 789GY makes clear, for avoidance of doubt, that an employee's:

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benefit arising because of their employer's obligation under section 789GD to satisfy the wage condition;

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agreement or disagreement to perform duties on different days or at different times in accordance with subsection 789GG(2);

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agreement or disagreement to take paid annual leave in accordance with a request subsection under subsection 789GJ(1), or to take annual leave at half pay in accordance under subsection 789GJ(2); and

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request in relation to secondary employment, training under section 789GU;

are workplace rights within the meaning of Part 3-1 (general protections) of the Fair Work Act. Adverse action cannot be taken against an employee because of the employee's workplace rights (see sections 340-342).

1.81 Coercion and false or misleading statements in relation to workplace rights are also prohibited (see sections 343 and 345).

Section 789GZ (Relationship with other laws)

1.82 Section 789GZ renders Part 6-4C subject to:

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Division 2 of Part 2-9 (payment of wages etc);

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Part 3-2 (unfair dismissal);

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Part 3-1 (general protections) and section 772 (employment not to be terminated on certain grounds) of the Fair Work Act;

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a Commonwealth, State or Territory anti-discrimination law;

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a Commonwealth, State or Territory law that deals with health and safety obligations of employers or employees, or with workers' compensation; and

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a person's right to be represented, or collectively represented, by an employee organisation or employer organisation.

Section 789GZA (Redundancy)

1.83 Section 789GZA provides that the giving of a JobKeeper enabling direction does not amount to a redundancy.

Division 13 - Review of this Part

Section 789GZB (Review of this Part)

1.84 Section 789GZB requires the Minister to cause an independent review to be conducted of the operation of Part 6-4C.

1.85 The review must start on or before 28 July 2020 and be completed and delivered to the Minister on or before 8 September 2020. These dates may be modified by regulation.

1.86 A copy of the review report must be tabled in each House of Parliament within five sitting days of that House after the report is given to the Minister.

Part 2 -Repeal of the core provisions of Part 6-4C of the Fair Work Act 2009 etc.

Fair Work Act 2009

1.87 Items 6, 7 and 9 of Schedule 1, Part 2 repeal:

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amendments made by Schedule 1, Part 1 to subsection 539(2);

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sections 789GA and 789GB; and

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Divisions 2, 3, 4, 5, 6, 9 and 11 of Part 6-4C;

consistent with the temporary nature of these changes.

1.88 The repeals occur at the start of 28 September 2020.

1.89 Item 8 of Schedule 1, Part 2 inserts 'repealed' in front of 'section 789GC'.

Transitional - JobKeeper enabling directions etc.

1.90 This item makes clear, for avoidance of doubt, that the repeal of relevant Divisions of Part 6-4C means that no further JobKeeper enabling directions can be given, and any JobKeeper enabling directions in effect at the time of the repeal cease to have effect from the repeal time. This means that once the substantive provisions are repealed, and any JobKeeper enabling directions or agreements made under these provision cease, employees' terms and conditions will revert back to what they were without the JobKeeper enabling directions or agreements in place.

Application and Transitional Provisions

1.91 Schedule 1 to this Bill will commence on the day after the day on which this Bill receives Royal Assent.