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  • A Senate Inquiry has made 29 recommendations to address ‘corporate avoidance’ of the Fair Work Act 2009.
  • Recommendations range from limiting the ability to terminate enterprise agreements to increased regulation of platform services in the ‘gig economy.’
  • A majority of the Committee (ALP Senators) found that employers are exploiting loopholes, breaching the law and engaging in practices that undermine the industrial relations system.
  • Coalition Senators presented the dissenting view that the commercial decisions of employers to act within the constraints of the FW Act do not amount to corporate avoidance.

On September 2017, the Education and Employment References Committee (‘Committee’) published its report on Corporate Avoidance of the Fair Work Act 2009 (‘Report’).

The Report followed the establishment, with cross-bench support, of a Senate Inquiry in October 2016, prompted by the growing perception that some employers were taking steps to avoid both the letter and spirit of the Fair Work Act 2009 (Cth) (the ‘FW Act’). These perceptions were fuelled by high profile industrial disputes, including the Carlton and United Breweries Dispute, and continued concerns about the effect of the ‘gig economy’ on worker protections.

The Committee, predominantly comprised of ALP senators, made robust and expansive comments about the adequacy of the FW Act, and the conduct of employers. In a broad finding that set the scene for its 29 recommendations, the Report observed:

‘It is the committee’s view that the economy has reached a level of sophistication and rapid change, especially in the post-GFC era, that the FWA is no longer fit for purpose and is in need of a thoroughly new approach that is based on a new more vibrant and flexible system for creating workplace rights and ensuring compliance with those rights…’

The recommendations include a number of sweeping and wide ranging amendments to workplace, safety, tax and migration legislation. Many would significantly change workplace laws for employers and employees across the country.

The majority findings are plainly not accepted by all. The Coalition Senators published a dissenting view in which they stated that the inquiry was fundamentally flawed because the commercial decisions of employers to structure their operations in a way that best suits their needs within the constraints of the system does not amount to ‘corporate avoidance’ of the FW Act. They also sought to discredit the inquiry as a means to push a union policy agenda.

Irrespective of the merits of either argument, the Report highlights the areas of possible reform if there is a change in government at the next federal election.

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