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Legislative Council - Fifty-Third Parliament, Second Session (53-2)
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Bills

Fair Work (Miscellaneous) Amendment Bill

Second Reading

Adjourned debate on second reading.

(Continued from 12 February 2015.)

The Hon. R.I. LUCAS (17:24): I rise to support the second reading of the Fair Work (Miscellaneous) Amendment Bill. The bill seeks to accomplish two prime objectives, the first being to abolish the Office of the Employee Ombudsman, and the second being to make some changes to the requirements for the constitution of the Full Commission of the Industrial Relations Commission.

The functions of the Employee Ombudsman were originally designed under the former industrial relations system, when we in South Australia had responsibility at that stage for both the public and private sector. As you are aware, Mr President, over a period of time, the states—South Australia included—transferred jurisdictional responsibility for industrial relations for the private sector to the commonwealth, and the state has essentially been left with the public sector and the local government sector.

Under the old circumstances, the Employee Ombudsman was there to protect the interests of those workers in the private sector who were not members of unions, and if they required assistance in terms of industrial relations help, that office was there to provide assistance to those workers. Clearly, those workers who are members of unions were able to be represented by their union representatives. Mr President, you would be very familiar with that system.

Under the new arrangements, the workload for the Employee Ombudsman's office in South Australia has steadily declined. There have obviously been other issues. I am not going to take time this afternoon in relation to the particular difficulties the Employee Ombudsman as an individual is currently going through in relation to other activities that he may or may not have undertaken whilst formerly an office holder within the trade union movement. If need be, we can address those on another occasion.

Nevertheless, that has added to the complexity of what the government has sought to do in relation to the Office of the Employee Ombudsman. It is fair to say that the minister and the government make no reference to that difficulty in their second reading contribution. It is couched in other reasons for the proposed change in arrangements. For a variety of reasons, the Liberal Party is prepared to support the first objective of this legislation—that is, the abolition of the Office of the Employee Ombudsman.

The minister was asked a series of questions in relation to what the termination provisions were for the Employee Ombudsman, and he has made it quite clear that there will be no termination payout. The position will disappear and, other than accrued recreation leave and long service leave—the minister is on the public record; he has given an undertaking to the house—there will be no payout of contract because he says there is no contract. There will be no redundancy payouts, and we take the minister at his word.

If the minister in charge of the bill in this house has any different information to place on the record, we would ask her to do so. If the minister has none, then we will assume that her position, on behalf of the government, is that she supports the statements minister Rau has made in the House of Assembly in relation to those particular issues.

In our consultation, those stakeholders who did respond—and I have to say it was not overwhelming; it does not appear to be a huge issue for most of the employer organisations in South Australia—supported the government's objective in the abolition of the position. The second proposal was a bit more controversial. We received a range of views from employer organisations, some who supported the government's position, some who expressed concern and one who was violently opposed to the government's proposition.

In summary, the government's argument for the change is that, at the time of the introduction of the bill, which was late last year, the Industrial Relations Commission comprised five persons: the president, two deputy presidents and two commissioners. However, in December of last year, Commissioner David Steel (who came from an employer organisation background) was retiring, which meant that the commission as of the end of 2014 would be left with a president, two deputy presidents and one commissioner, and that one commissioner came from an employee organisation background.

The government claimed in the second reading that, due to the declining workload, the government did not propose to replace Commissioner Steel with another commissioner. The Fair Work Act requires that, if there is an appeal to the full bench of the Industrial Relations Commission against a decision of the sole remaining commissioner, then the full bench must comprise at least one commissioner. However, of course, if Commissioner Steel was not replaced with another commissioner, then that would just be physically and practically impossible. So, this bill is intended to provide a solution to that particular problem.

One of the concerns that has been raised with the opposition was that the government might replace Commissioner Steel with another commissioner, and that commissioner might not come from an employer background. There is a legislative requirement I think—it is not just a convention—that there is a balance in terms of the commissioners in essence broadly representing employer organisations and employee organisations. The government indicated that they were not going to replace the commissioner.

Then there was concern amongst a number of employer organisations that the government was going to appoint an additional deputy president—that is, get around the issue of balancing interests amongst the commissioners by appointing another deputy president. Various names were being speculated, all of which essentially either represented employee organisations' interests or were persons very closely associated with the Labor Party or persons very closely associated with Premier Weatherill.

These issues were pursued with the Minister for Industrial Relations in the House of Assembly, and the minister is on the public record. I quote this because I seek from the minister in charge of this house, before the bill is finally proceeded with, that the position of minister Rau is the position the minister in charge of the bill in this house places on the record for members of the Legislative Council in relation to the government's intentions. Minister Rau was asked by the member for Bragg:

Regarding the intention of the government to replace or add, at this point you say there will be no other appointments made to the Industrial Relations Commission?

The minister is on the record as saying:

Absolutely; that is my position on this. First of all, there are two things that I intend to do. The first is to remove the requirement for there to be a commissioner, which means that we can have a full bench with deputy presidents. Secondly, if we are running short of deputy presidents, if I can find somebody else who is already an existing judicial officer, or suchlike, who is already appointed and is already getting a salary who does not also have a deputy president's hat to wear, and that person is competent and able to do so, I will give serious consideration to making them a deputy president as well—one or two of them, however many, if necessary. But I do not see that as an end to this. What I am attempting to do is deal with the end of a system which was designed for a completely different time and place. I cannot go on appointing commissioners to sit there and deal with unfair dismissals and industrial disputes in the private sector that they do not hear. That would be silly.

Later on, he says, 'There is absolutely no call for the appointment of a commissioner', etc. So, the minister on behalf of the government in the House of Assembly late last year on 2 December made it clear that he and the government would not be appointing another commissioner and they would not be appointing another deputy president. I seek from the minister, based on the advice that she will receive: is that still an undertaking and a commitment on the record in this house from the minister?

The second issue is an interesting one, because if that is the case, if a particular deputy president goes on leave or is sick, then there are particular problems in terms of constituting an appeal commission. That is why minister Rau talks about potentially finding somebody else who is already being paid in some other jurisdiction (probably the federal jurisdiction), who might be able to also take up this role.

So, my second question is: given this commitment was given on 2 December, I am assuming the minister should be in a position to indicate—now he has had nearly three extra months, 2½ extra months to contemplate this—what are his proposals. It does not mean a change to this legislation, but clearly, as the shadow minister in the area and I think other members who are interested in the jurisdiction will be wanting to know what the government and the minister are thinking in relation to what is a genuine problem if there are to be no further commissioners and deputy presidents appointed. What is the minister's current thinking? How far advanced is he? Can he have, through the minister in this house, put on the public record where he has got to, 2½ months down the track from the answers he gave to the member for Bragg in the House of Assembly?

As I said, a number of employer organisations supported the change, this particular second change. Some expressed some concerns, and one was strongly opposed. I know that the fact that the minister has placed on the public record a commitment that he was not appointing an additional commissioner or deputy president from either an employee organisation background or from a Labor-friendly background (he has not actually said the Labor-friendly bit, but that is the way it has been interpreted) and that there will be no further appointments has moderated some of the criticism from some of those employer organisations which were concerned at what they might have seen as a vehicle for further stacking of the Industrial Relations Commission.

That is why I am asking for the minister to, firstly, place on the record that that is still the minister and the government's commitment in relation to further appointments and also seek some advice in relation to the minister's intentions to cover what will be, potentially, inevitable issues that might arise in terms of constituting an appeal against a particular decision of a commissioner or deputy president on the Industrial Relations Commission. With that, we indicate our support for the second reading, and we look forward to the minister repeating the commitments that minister Rau gave in the House of Assembly.

The Hon. G.A. KANDELAARS (17:38): I rise to support this bill. This bill amends two sections of the Fair Work Act 1994. The bill removes the Employee Ombudsman and also makes changes to the composition of the Full Commission of the Industrial Relations Commission in relation to who it may consist of. The Office of the Employee Ombudsman consists of the Employee Ombudsman and staff to assist the Employee Ombudsman in the performance of functions under the Fair Work Act 1994. Its functions were designed to operate in the context of the former industrial relations system, whereby the state had responsibility for state/private sector and the Employee Ombudsman was considered necessary to protect the rights of non-union-represented workers in that sector.

The Employee Ombudsman's latest report noted that more inquiries were received from the private sector than the public sector, for which the Ombudsman has no statutory function. Since the commencement of the commonwealth Fair Work Act in January 2010, the function of the Employee Ombudsman has been limited to the state public sector and local government employees resulting in a substantially reduced workload for the Employee Ombudsman. All private sector employees are now covered by the commonwealth Fair Work Act. The services once provided by the Employee Ombudsman for private sector employees are now provided by the commonwealth Fair Work Ombudsman.

The residual function of the Employee Ombudsman for the state public sector and local government sector are already performed by SafeWork SA, a business unit of the Attorney-General's Department, and representative unions such as the PSA and ASU, thus removing the need for a dedicated Employee Ombudsman and office. There are also free or low cost services available to both public and private sector employees. This includes the Legal Services Commission, the Office of the Training Advocate and the Young Workers Legal Service, to name a few.

Consequently, this bill reduces the state government's financial burden of providing services that are already provided by the commonwealth, existing state agencies and other organisations. The bill will also amend the Fair Work Act 1994 to remove the requirement of section 39(3) for the Full Commission of the Industrial Relations Commission to include one or more commissioners. Instead, the Full Commission is to be constituted of one or more presidential members and such number of commissioners, if any, as directed by the President of the Industrial Relations Commission.

The Industrial Relations Commission of South Australia, constituted by the South Australian parliament under the Fair Work Act 1994, has a major role to play in establishing enforceable conditions of employment and in providing for the prevention and resolution of disputes between employers and employees of the state public sector, almost all state government business enterprises and local government in South Australia.

The Full Commission of the Industrial Relations Commission has original jurisdiction in minimum standards applications such as remuneration and the adoption of the Fair Work Australia principles. It also has original jurisdiction in unreasonable conduct applications as well as appeals and references from single members and applications by the minister for review. Currently section 39(3) of the Fair Work Act requires the Full Commission to consist of one or more presidential members and one or more commissioners.

In December 2014 commissioner Steel reached the statutory retirement age and ceased his membership of the commission. Since commissioner Steel's retirement, the commission consists of two presidential members who are also judges of the Industrial Court, one deputy presidential member and one commissioner. Commissioner Steel's retirement and the subsequent reduction in the membership of the commission has given rise to the potential difficulties in constituting full benches of the commission as currently required under section 39 of the act.

With only one commissioner, it would be impossible to constitute a full bench against a decision of the remaining commissioner under the current legislation. Further, an appeal against a decision of the deputy president or a judicial presidential member, by necessity, has to be heard by a full bench which includes the remaining commissioner, including in circumstances where he may have been involved in the matter under appeal by way of conciliation proceedings. While there is no prohibition under the act with respect to that course, it has been the practice of the commission to avoid placing a member who has previously had an involvement with a particular issue on an appeal bench in such circumstances.

My understanding is that the bill will therefore allow for the commissioner to avoid placing members who have had previous involvement with an issue on the full bench for a matter. This amendment provides greater flexibility for the president in constituting a full bench. It does not prevent commissioners sitting on the Full Commission, as the president may still direct a commissioner to sit on the Full Commission. I support this bill and the amendments it makes to the Fair Work Act.

The Hon. G.E. GAGO (Minister for Employment, Higher Education and Skills, Minister for Science and Information Economy, Minister for the Status of Women, Minister for Business Services and Consumers) (17:45): I understand there are no further second reading contributions. As honourable members have noted, this Fair Work (Miscellaneous) Amendment Bill amends the Fair Work Act as well as making consequential amendments to abolish the statutory Office of the Employee Ombudsman and to make changes to the requirement for constitution of the Full Commission of the Industrial Relations Commission.

I thank all honourable members for their second reading contributions and support of this bill. The Hon. Rob Lucas has asked two questions, and I am happy to provide the answer to those during clause 1 of the committee stage.

Bill read a second time.

Committee Stage

In committee.

Clause 1.

The Hon. G.E. GAGO: The Hon. Rob Lucas has asked that we again confirm, in this house, that there will be no other appointments to the Industrial Commission, and the advice I have received is that I can confirm that to be the case. The second question was in relation to how appeals might be dealt with if there were a sickness. I am informed that the view is that there are currently resources within the commission to accommodate this sort of occurrence. There are four currently within the court: a president, two deputy presidents and a commissioner.

I am advised that section 35(2) provides for the appointment of an acting commissioner if required. The president and three deputy presidents from the Industrial Court are eligible, as are two deputy presidents recently appointed to the South Australian Employment Tribunal. All are already drawing salaries and I am advised would attract no additional payment, and therefore could accommodate that situation.

The Hon. R.I. LUCAS: The minister has just said, I think, that the Minister for Industrial Relations could, for an appeal, appoint the new Employment Tribunal commissioners, one of whom is, I think, a former law partner of the Premier's. His name escapes me—

The Hon. B.V. Finnigan interjecting:

The Hon. R.I. LUCAS: No, I think Calligeros and Dolphin have just been appointed as the members of the Employment Tribunal. Is the minister saying that minister Rau could appoint one of those two new Employment Tribunal members as a commissioner, on a temporary basis, to handle appeals?

The Hon. G.E. GAGO: I am advised that they could be appointed as deputy presidents of the commission, and there are also powers to temporarily appoint an acting commissioner.

The Hon. R.I. LUCAS: As I understand the position, this is really in the context where there is a sickness or an absence. For example, I understand some of them might have accrued long service leave or whatever else it might happen to be. However, as I said, the major concern of the employer organisations was with the retirement of Commissioner Steel. The arrangement previously was that there was a commissioner from an employer background and there was a commissioner from an employee background. The commissioner from the employer background had retired so, if there was to be another appointment, in the interests of the practice, procedure and convention in South Australia, someone from an employer background was to be appointed.

Now the minister is saying, 'I am not going to appoint any more.' That meant that there could be no commissioner appointed from an employer background. However, in circumstances where an acting commissioner or deputy president has to be appointed and the government and the minister was to appoint someone from the Industrial Court, as I understand it, who comes from an employee background—I think the Hon. Mr Finnigan referred to Mr Lieschke or whoever it might happen to be—then there would be significant concern from employer organisations, in essence, that they had been dudded by the minister and the government through this as a particular device.

The minister obviously can resolve that by indicating, in the limited circumstances where this might occur, in the interests of fairness and following the practice and procedure, that there be a balance in terms of the constitution of the appeal body—that they would not all be people from an employee organisation background but that there would be at least some representation from an employer organisation background. If this legislation goes through, that is obviously completely at the behest of the Minister for Industrial Relations, minister Rau.

We are not intent on holding this bill up past this week, or indeed even beyond today, but I ask the minister whether she is in a position at the moment, or whether she is prepared to adjourn and seek some advice from minister Rau as to his intentions in relation to this. It is a straightforward matter in terms of what his intentions would be.

He obviously cannot give names or whatever but, in the circumstances we are talking about, particularly as the minister is indicating that the new members of the Employment Tribunal are potentially eligible to be appointed by the minister, if minister Rau through minister Gago is prepared to give any indication of his bona fides in relation to this, it certainly might mollify some of the employer organisations' concerns originally about the legislation and now, given this advice from the minister, about what might potentially be being contemplated by the minister and the government. Certainly, if that was the case, I think it would be useful if an assurance or an indication from the minister could be given.

The Hon. G.E. GAGO: I have been advised that the sections to which the question refers are sections 30 and 34, which outline the process for the appointment of a president and deputy president and/or commissioners. That stipulates that the minister is required to consult, and it stipulates a range of stakeholders.

The Hon. R.I. LUCAS: Sorry, before the appointment of an acting commissioner?

The Hon. G.E. GAGO: Before the appointment of an acting commissioner. Section 34 provides that the minister must consult confidentially about the proposed appointment and that the panel consist of the usual suspects: a nominee of the United Trades and Labour Council, the South Australian employers chamber, the House of Assembly (appointed by a resolution of the house), a nominee of the Legislative Council and the Commissioner for Public Sector Employment. That is a requirement within the act.

The Hon. R.I. LUCAS: I will return to that in a moment, but I have just found the minister's press release. The two deputy president appointments to the Employment Tribunal are Mr Calligeros, who is a partner at Minter Ellison, and Mr Steven Dolphin, a Principal at Lieschke & Weatherill Lawyers who has practised in employment and labour law, industrial relations law and workers compensation law across many courts, including the Federal Court and the Fair Work Commission.

One of the concerns we raised during the debate last year regarding the Employment Tribunal—unsuccessfully as it was in the end—in relation to the SACAT as opposed to the Employment Tribunal was this government's record in relation to appointing fellow travellers. Clearly, anyone with an association with Premier Weatherill seemed to do pretty well. The Hon. Mr Finnigan pointed out that Stephen Lieschke, who is an Industrial Magistrate in the Industrial Relations Court of South Australia, was obviously a partner of Lieschke & Weatherill. Steven Dolphin has just been appointed and he is a principal at Lieschke & Weatherill. One need only look at some of the other names: Judge Leonie Farrell, of course, has very strong connections with the right faction of the Labor Party, as the Hon. Mr Ngo and the Hon. Mr Finnigan would be aware.

Some of the other names in the Industrial Relations Court and the commission have very strong connections to the Labor Party, as I indicated before. It was one of our concerns about the government's intentions with this Employment Tribunal. One of the first two appointments, of course, is a principal at Mr Weatherill's old legal firm.

So, what the minister has just indicated is that, potentially, Steven Dolphin could be appointed to this appeal commission. I just want to clarify: could Industrial Magistrate Stephen Lieschke, under the indication that the minister gave, also be one of the persons appointed as an acting commissioner to hear one of these appeals?

The Hon. G.E. GAGO: In terms of the latter question, I am advised that no, he is not eligible. Going back to your first question, or your concerns that you were expressing, I just remind honourable members that commissioner Dolphin is only one of six eligible who are currently appointed to higher offices than the commissioner. There are a number of both employer and employee-based, if you like, people within those six, so there is still ample opportunity to be able to select a balance of representatives. The process is really locked down, or is bound, by the provisions in the act that require some pretty highbrow consultation and consideration as to who might be a suitable acting commissioner.

The Hon. R.I. LUCAS: Can I just clarify then? The printout I got from the Industrial Relations Court, Industrial Relations Commission and Workers Compensation Tribunal lists Stephen Lieschke as an industrial magistrate for the Industrial Relations Court but also listed him as a deputy president of the Workers Compensation Tribunal. Does he hold or is he about to hold a position with the Employment Tribunal?

The Hon. G.E. GAGO: This is Lieschke you are asking about?

The Hon. R.I. LUCAS: Yes, Lieschke.

The Hon. G.E. GAGO: I am advised no.

The Hon. R.I. LUCAS: So, he is no longer a deputy president of the Workers Compensation Tribunal?

The Hon. G.E. GAGO: I am advised that he remains a deputy president of the Workers Compensation Tribunal; however, he has not been appointed to the SAET.

The Hon. R.I. LUCAS: As deputy president of the Workers Compensation Tribunal, would he or would he not be eligible to be appointed as a commissioner to hear one of these appeals?

The Hon. G.E. GAGO: I am advised yes.

The Hon. R.I. LUCAS: Yes, he would be eligible?

The Hon. G.E. GAGO: I am just advised that the adviser has corrected the answer.

The Hon. R.I. LUCAS: So, what is the corrected answer?

The Hon. G.E. GAGO: Can you just ask the question again?

The Hon. R.I. LUCAS: Yes, sorry. I originally asked the question—and I am not experienced in this jurisdiction—whether Stephen Lieschke, as an industrial magistrate in the Industrial Relations Court, would be eligible to be appointed as a commissioner to hear an appeal, and the answer to that was no. Then, I asked a question: isn't Stephen Lieschke a deputy president of the Workers Compensation Tribunal and, wearing that hat, could he be appointed as an acting commissioner? So, I am seeking to establish the answer to that question. Can Stephen Lieschke, wearing any hat, be appointed as an acting commissioner?

The Hon. G.E. GAGO: The adviser has corrected that answer, and I am sorry to have misled you. The answer is yes to both questions.

The Hon. R.I. LUCAS: To both questions?

The Hon. G.E. GAGO: To both questions, yes, he is eligible. I apologise for an incorrect answer.

The Hon. R.I. LUCAS: I accept that the minister is only passing on the information from the adviser. I think that, as I said, does raise the issue which I want to leave with the minister and, if she cannot get a response from minister Rau on the issue immediately—and I expect that—whether we should be prepared to adjourn until tomorrow. The minister has said that, under section 34:

(1) The Commissioners are the persons appointed by the Governor as Commissioners.

(2) Before a person is appointed (or reappointed) as a Commissioner, the Minister must consult confidentially—

with this panel that she talked about.

I am taking it that the minister's advice from her adviser is that that clearly applies to a commissioner being appointed. But what we are talking about here is a temporary appointment of a commissioner and I take it that the minister's legal advice is that these provisions of the act apply to temporary appointments for acting commissioners for an appeal purpose, in addition to clearly what they were intended to be which was when you are really appointing a commissioner in the jurisdiction.

The Hon. G.E. GAGO: I am advised that it would apply to the positions of commissioner or acting commissioner. They would both be captured under section 34.

The Hon. R.I. LUCAS: Mr Chairman, I am wondering whether and, as I said, there is no intent from me to seek to unduly prolong the committee stages or this bill, but there are strong views which the minister's adviser would be aware of from some employer organisations. The government and the minister's advisers might not be particularly fussed with that, but they would at least be aware of that, and one of those concerns is this view that because commissioner Steel is not being replaced by someone from an employer organisation's background that in some way the jurisdiction and appeal might be stacked.

Clearly, what I am asking is whether the minister is prepared to report progress and seek a statement from the minister. He may not be prepared to give it and that is fair enough. We will have to make a judgement then on the basis of whatever the minister's considered statement might be. But what comfort can you give to those who are concerned, for example, if there was an appeal, that, because commissioner Steel has not been replaced by someone from an employer background, that the minister in the appointment of an acting commissioner would not, in essence, stack the appeal bench (if that is the right word for it) by appointing, for example, someone from an employee organisation background in all circumstances.

Now, if there is already on the appeal bench someone representing an employer organisation interest then I think the employer organisations would be comforted by that, but if the whole of the appeal bench was to be constituted by people from employee organisation backgrounds, and minister Rau was then to appoint deputy president Lieschke, or deputy president Dolphin, or both of them in certain circumstances, then there would be concerns from employer organisations that minister Rau, through a device, has managed to negate some pretty strongly-held views that they have about the appropriateness of this.

They have not gone into the public arena on this particular issue because of the assurances that the minister gave the lower house about not appointing other commissioners and deputy presidents. They have maintained their criticisms and concerns directly to myself, as the shadow minister. But I think we should at least give the minister an opportunity, on reflection overnight, to come back and see what he is prepared to put on the public record, and then we can have a quick consultation with the employer organisations to see what, if anything, they would like to put on the public record in terms of either their concern or their willingness to accept the undertaking from the minister. So I would ask the minister whether she would be prepared to take that on notice and report progress and we can reconvene tomorrow.

The Hon. G.E. GAGO: I am happy to take that question on notice and move that progress be reported.

Progress reported; committee to sit again.


At 18:09 the council adjourned until Wednesday 25 February 2015 at 14:15.

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