2016 in Review

We consider what the major employment law stories for 2016 were and what their impact might be as we head into the new year.

Parental leave

Leading up to the election, the Coalition scrapped Tony Abbott’s maternity leave scheme which promised that mothers would be paid their full income for 6 months.

The policy at that time entitled eligible primary carers who earned less than $150,000 per annum to a maximum of 18 weeks parental leave at minimum wage on top of any paid parental leave from their employer. The Coalition proposed a ‘fairer’ cut back to the existing system and Labor’s election campaign promised no changes to the original policy and a reversal of the cuts proposed by Malcolm Turnbull.

The Government introduced the Fairer Paid Parental Leave Bill on 20 October 2016. If it is passed, government parental leave will only apply as a ‘top up’ to any payments made by the employer, so that each person is only entitled to a combined maximum of 18 weeks and cannot ‘double dip’ from both sources to accumulate more than 18 weeks.

This legislation faces a great deal of opposition from both Labor and the Greens, which means the Government needs the support of 9 crossbench senators to pass the bill. For this reason, despite its potential start date of 1 January 2017, it’s likely that any changes won’t come into effect until later in the year.

Contributor Alecia Thompson previously wrote about the potential impact of these changes on women who are already pregnant.

7-Eleven and vulnerable workers

In 2016, 7-Eleven faced heat from both a Senate Inquiry as well as the Fair Work Ombudsman (FWO) for franchisees underpaying and exploiting often vulnerable workers. A key election promise for the Coalition was to deliver stronger protection for vulnerable workers, particularly through penalising employers and strengthening the powers of the FWO.

They followed through on these promises with the announcement of a Migrant Worker Taskforce and new laws in 2017 to enhance the FWO’s examination powers and prohibit employers from providing false and misleading information to Fair Work Inspectors. Heading into 2017, the Taskforce will have an additional function of monitoring 7-Eleven’s progress in rectifying their breaches in underpayment, manipulation of payroll systems and doctoring false employment records.

7-Eleven signed a landmark proactive compliance deed with FWO. Under the deed, the most comprehensive of its kind for a franchise brand in Australia, all 7-Eleven stores must install biometric shift scanning systems and CCTV that will allow head office to monitor worker hours against what is paid to them. 7-Eleven will also implement a central payroll system specifying minimum rates for workers and employ an independent auditor.

Australian Building and Construction Commission (ABCC)

The ABCC, replaced by the Gillard government with Fair Work Building and Construction in 2012, was a watchdog to combat ‘an industry experiencing lawlessness’. The Coalition has maintained that the ABCC is needed to tackle illegal behaviour on construction sites and improve productivity through tougher penalties. They failed to have its reinstatement passed twice – most recently leading to the double dissolution election in July this year.

The Turnbull Government reintroduced the ABCC bill in August and it passed successfully through both houses by the end of November, despite opposition by Labor and the Greens. The new bill had extra oversight for the commission’s coercive powers, a requirement for building to be offered to locals, security of payment for subcontractors, judicial review and a review of the operation of the laws within a year.

Changes to Modern Awards

The Fair Work Commission varied some awards with new or changed terms about taking annual leave, with most taking effect from 29 July 2016.

Most awards now permit employees to cash out annual leave in advance provided they have at least 4 weeks annual leave left after the cash out, have signed a written agreement with their employer and don’t cash out more than 2 weeks each year. Under most awards, employees can also take annual leave in advance if their employer agrees in writing.

The changes also provide some rules for managing employees that have excessive annual leave balances, i.e. where an employee has accumulated at least 8 weeks of leave, or 10 weeks if they are a shift worker.

In the event that an employee has an excessive annual leave balance and can’t agree with their employer on when to take it, the employer can tell the employee in writing that they must take annual leave, giving at least 8 weeks’ notice of when the leave will start. Note that there are rules about how long the period of leave has to be and how much the employee has to have left afterwards. Some awards will also allow employees with excessive annual leave balances to tell their employer that they will take a period of leave, although these clauses do not take effect until 29 July 2017.

Finally, a new clause has been added  to some awards permitting the employee to continue to be paid using the usual pay cycle during periods of leave if they are paid by electronic funds transfer, rather than be paid a lump sum in advance.

Our most popular blog articles

We also have a number of our blog articles that were very popular amongst our readers this year. Take a look back at the ones that really struck a chord with you:


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Alecia Thompson

Alecia is known around the PCC offices as the strange one that doesn't drink coffee. Despite her lack of coffee drinking, Alecia works as an employment law solicitor and is passionate about providing practical advice that can help make your business a success. Alecia has visited all seven continents so can keep up in just about any conversation about travel. Contact her here.

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