The Fair Work Commission announces minimum wage increase from 1 July 2017

Minimum wages to increase by 3.3%

The Fair Work Commission’s panel for annual wage reviews released its Annual Wage Review 2016-2017 decision on 1 July 2017.

The decision provides that minimum award wages will increase across the board by 3.3% effective 1 July 2017.

This decision will result in the following increases to the Federal minimum wage rates:

  • Weekly minimum wage: from $672.70 to $694.90 (increase of $22.20),
  • Hourly minimum rate: from $17.70 to $18.29 (increase of 59 cents).

Otherwise, the percentage increase will apply to the minimum rates of pay contained in awards. Increases to minimum weekly wages will be rounded to the nearest 10 cents.

In fixing the increase at 3.3% (up on last years 2.4% increase), the Panel observed that the prevailing economic circumstances provide an opportunity to improve the relative living standards of the low paid and to enable them to better meet their needs.

Employers should now start to review their employees’ existing rates of pay to ensure compliance with minimum rates when the above changes commence on 1 July 2017.

Annual Wage Review 2016-17 [2017] FWCFB 3500

Paying the Price: Employee required to pay employer’s legal costs after losing unfair dismissal case

The Fair Work Commission has ordered a former cabin crew supervisor to pay his ex-employer’s legal costs after rejecting settlement offers and then losing his unfair dismissal claim. The case provides a useful illustration of an employer successfully recouping costs under Fair Work Act provisions where an employee has rejected a reasonable offer to settle. Continue reading

Requests for Flexibility – when can employers say no?

In today’s workplace, the right to flexibility at work is not only protected by both federal and state laws, but notions such as “flexible work practices” and “work – life balance” are commonly pitched by employees in their increasing requests for flexible working arrangements.

As a general rule, employers can only reject an employee’s request for flexible working arrangements on “reasonable business grounds”, which is now helpfully defined in the Fair Work Act 2009 (Cth) (Fair Work Act), and extends to considerations including cost, practicality and capacity. 

The concept of “reasonable business grounds” was considered by the Fair Work Commission (FWC) last week in an unfair dismissal case in which the employer had refused an employee’s request to return part-time after maternity leave.

Facts giving rise to request

After several periods of maternity leave commencing in February 2011, in May 2015 the full-time Business Development Executive requested that she return to work on a part-time basis. Upon considering the request, the employer, a travel agency, responded that the business was unable to facilitate the request as it would be “unable to maintain the necessary service standards and expectations within the sales division“. In short, (and despite recognising the employee’s long tenure), the employer stated that it could not offer the employee her pre-maternity leave position on a part-time basis, nor were there any current part-time roles of a similar level available. The employer gave the employee two options: to accept her pre-maternity leave position on a fulltime basis or to resign. The employee unwillingly chose the latter.

Employee’s right to request

In this case, the employee’s right to request flexible working arrangements arose under the parties’ enterprise agreement. Similarly to the general right to request provisions of the Fair Work Act, this agreement provided that the employer could only refuse a request from an employee returning from parental leave to work part-time until their child reached school age on “reasonable business grounds”. The agreement stated that such grounds “might include cost, lack of adequate replacement staff, loss of efficiency and the impact on customer services“.

No forced resignation by Employer

The FWC took into account evidence from the employer’s general HR manager regarding the business reasons for the employer’s refusal to convert the employee’s employment status to part-time.

The FWC ultimately determined that the employer’s refusal to accommodate the request was reasonable. The FWC also noted feedback received by the company from travel agents to the effect that there was a need for the Business Development Executive to be available on a fulltime basis.

The FWC rejected the employee’s argument that it was the employer’s action in denying her request that forced her to resign. Despite sympathising with the employee’s circumstances, the FWC considered that it was more likely the employee’s own personal circumstances, rather than the employer’s action in denying her request, that lead the employee to resign.

Responding to requests for flexibility

This decision will no doubt comfort employers who wish to rely on the “reasonable business grounds” exception to refuse employee requests for flexible working arrangements. However, employers need to carefully assess individual requests for flexibility against business roles and needs, and their own internal policies. When responding to requests, employers should also be mindful of formal requirements required under the Fair Work Act or an applicable industrial instrument.

Employers should also consider how flexibility might provide an opportunity, rather than a cost. Australian employers are increasingly seeking competitive advantage through flexible workforce arrangements not only through retaining and incentivising talent, but also through lowering overheads associated with a static office based workforce.

See: Ms Catarina Reale v Helloworld Ltd T/A Qantas Holidays and Viva Holidays Ltd [2015] FWC 7122

Morning (Sickness) Glory – Damages award for morning sickness discrimination

We all become sick of mornings at some point, whether it’s ‘Mondayitis’ or extreme regret at signing up for 5am corporate  boot-camp with your colleagues. However, a recent decision in Victoria has recognised severe morning sickness (the legitimate, pregnancy-related kind) as a disability for the purposes of State anti-discrimination laws, awarding $10,000 in general damages for associated discrimination.

Severe morning sickness a disability

The employee in this case was successful in her initial claim that she was being discriminated against by her employer because she was suffering from severe morning sickness, when comments about taking sick leave and toilet breaks were made by her employer. This discrimination was based on the employee’s pregnancy, which is not particularly ground-breaking as discrimination based on pregnancy is already prohibited by all states’ anti-discrimination laws. However, the Tribunal found that this severe form of morning sickness (named “Hypermesis Gravidarum” to the medically-minded) is a ‘disability’ because the symptoms involve functions of the body failing to function properly.

The finding that symptoms of pregnancy can be a disability is important because disabilities are often treated differently to other attributes under anti-discrimination laws. For example in Victoria employers are under a heavy burden to make reasonable adjustments for  an employee with a disability, whereas the burden is less for pregnant employees. There are also federal laws which create obligations in respect of pregnant employees, or employees with a disability under federal laws, although this case concerned Victorian laws.

The employee received a general damages award of $10,000 for hurt and humiliation. However, she was unsuccessful in her claim that the employer failed to make reasonable adjustments to her working hours for her disability, because there was no medical evidence that she required such an adjustment.

Are wacky pregnancy cravings also a disability?

Probably not. It was said that ordinarily a pregnant woman is not considered to have a disability. This suggests that ordinary pregnancy symptoms do not constitute a disability unless the symptoms involve certain functions of the body failing to function properly.

The upshot of this case and damages award is that employers may need to have regard to relevant disability legislation in their treatment of pregnant employees – in addition to pregnancy-specific protections under the Fair Work Act 2009 (Cth) and relevant sex discrimination laws, if an employee has indicated that functions of her body are failing to function properly as a result of the pregnancy.

Whilst the employee has been awarded $10,000 in damages, she is appealing the merits of the original decision in the Victorian Supreme Court, so stay tuned.

See: Bevilacqua v Telco Business Solutions (Watergardens)PL No. 2 (Human Rights) [2015] VCAT 693 (28 May 2015) and the original decision Bevilacqua v Telco Business Solutions (Watergardens)PL (Human Rights) [2015] VCAT 269 (11 March 2015)