1 January 2004 heralded significant changes to the terms and conditions of employment of hundreds of thousands of Victorian employees with the introduction of the Workplace Relations Amendment (Improved Protection for Victorian Workers) Act 2003.

The Act has two important ramifications:

COMMON RULE AWARDS
The changes introduced by the Kennett government in 1996 mean that an industrial award will only apply to a Victorian employer if it has been named as a respondent, is a member of an employer organisation that is a named respondent or if it is a successor, assignee or transmittee of an employer who is a named respondent.

The new Act changes the situation dramatically in that it empowers the Australian Industrial Relations Commission ("AIRC") to declare that a federal award will apply as a "common rule" for a particular industry, such that all employers in that industry will be bound by that award.

Any awards declared common rule awards will become binding on Victorian employers from 1 January 2005. This transitional period allows employers who are not currently bound by an award to make alternative arrangements, such as implementing a certified agreement or Australian Workplace Agreements. Those employers who have historically not been faced with award entitlements such as overtime payments, penalty rates and leave loading, should be considering their current situation and seeking advice as to the ramifications of the new Act for their business.

MINIMUM CONDITIONS FOR VICTORIAN EMPLOYEES
The new Act also increases the minimum terms and conditions of employment for Victorian employees as specified in Schedule 1A of the Workplace Relations Act 1996.

Schedule 1A currently prescribes five minimum conditions of employment that apply to all Victorian employees who are not subject to a federal award, certified agreement or Australian Workplace Agreement. The new Act:

Cornwall Stodart's Workplace Relations Group are happy to assist you and your business with a further understanding of the effect of this important legislation and ways to minimise its disruption to your business.

In December 2003 the High Court granted leave to appeal in both the Amcor and Gribbles transmission of business cases. The appeals will be determined by the High Court of Australia some time this year.

Two decisions of the Federal Court overturned widely held beliefs about redundancy and transmission of business issues.

1 CFMEU v AMCOR
This case arose out of Amcor's decision to separate its fine paper from its core packaging operations by selling its mills to a wholly owned subsidiary, Paper Australia.

Amcor completed the transfer to Paper Australia by writing to affected employees advising them that their employment with Amcor would be terminated and simultaneously offering them identical positions on the same terms and conditions of employment with Paper Australia.

The Construction, Forestry, Mining and Energy Union ("CFMEU") argued in the Federal Court that in the restructure Amcor had, at law, made the employees' positions redundant in spite of the fact that the employees had all been offered ongoing employment in the same positions with Paper Australia.

Justice Finkelstein accepted the CFMEU's argument and found that as the certified agreement which applied in this case made no exception for the payment of severance payments where the employees had obtained suitable alternative employment, the employees were entitled to redundancy payments from Amcor.

In March 2003, the Full Bench of the Federal Court rejected Amcor's appeal from this decision.

Stay tuned for further details of the High Court appeal.

2 HSUA v GRIBBLES RADIOLOGY
Gribbles Radiology carried out its business in a clinic, which had previously been occupied by another radiology company, MDIG. Gribbles moved into the premises that had previously been occupied by MDIG and employed the radiology staff that had been previously engaged by MDIG.

Under section 149(1)(d) of the Workplace Relations Act 1996, an Award binds "any successor, assignee or transmittee (whether immediate or not) to or of the business of an employer" who was bound by an Award.

In this case the Federal Court found that Gribbles was a "successor" to MDIG for the purposes of the Act and was therefore bound by MDIG's Award despite there being no commercial dealings between two companies.

The Full Bench of the Federal Court rejected Gribbles' appeal in March 2003 and the High Court of Australia will hear Gribbles' further appeal later this year.

Whilst the outcomes of these appeals are uncertain, employers are well advised to review the redundancy provisions in their current agreements and seek assistance if necessary.