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2008-2009
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
COAL MINING INDUSTRY (LONG SERVICE LEAVE FUNDING)
AMENDMENT BILL 2009
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Employment and Workplace
Relations,
the Honourable Julia Gillard MP)
Coal Mining Industry (Long Service Leave Funding) Amendment Bill
2009
OUTLINE
Employees in the coal mining industry are entitled to long service leave on
the basis of service in the industry, rather than their service with a
particular employee. Funding of long service leave entitlements is
supported by an industry scheme established by the Coal Mining Industry
(Long Service Leave Funding) Act 1999 (the Funding Act) and related
legislation, including the Coal Mining Industry (Long Service Leave)
Payroll Levy Act 1992 and the Coal Mining Industry (Long Service Leave)
Payroll Levy Collection Act 1992.
Under the Funding Act employers are reimbursed from the Coal Mining
Industry (Long Service Leave) Fund (the Fund) for any long service payments
they make to eligible employees in respect of their long service leave
entitlements.
From 1 January 2010, the present industry awards prescribing long service
leave will be superseded by modern awards under the Fair Work Act 2009 (the
FW Act). Modern awards will not include long service leave entitlements.
Rather, existing award based entitlements will be preserved as a statutory
entitlement under the National Employment Standards, pending development of
national long service leave arrangements.
As a consequence of these changes, because the Funding Act does not
currently cover entitlements determined by the National Employment
Standards, employers will not be entitled to reimbursement from the Fund in
respect of the long service payments they make to employees.
The amendments contained in the Bill address this situation. The
amendments ensure that, from 1 January 2010, employers will be entitled to
reimbursement from the Fund in respect of long service payments they make
to employees pursuant to the preserved entitlements in the FW Act, in
addition to the current arrangements for reimbursement of entitlements paid
under industrial instruments and contracts. This is a technical amendment
which will not affect employees' long service leave entitlements or
employers' long service leave Fund obligations
This Bill also contains the following amendments to ensure that the scheme
applies universally in the black coal mining industry from 1 January 2010:
. the definition of 'black coal mining industry' in the Funding Act
(which flows through to related legislation) will be aligned with the
definition in the Coal Award; and
. the current long service leave entitlements in The Coal Mining
Industry (Production and Engineering) Consolidated Award 1997 (the
main industry award) will be extended to all eligible employees who do
not otherwise have an award-derived long service leave entitlement.
FINANCIAL IMPACT STATEMENT
There is no impact on Commonwealth finances.
NOTES ON CLAUSES
1. The following abbreviations are used in the Notes on Clauses:
|FW Act |Fair Work Act 2009 |
|NES |National Employment Standards |
|this Bill |Coal Mining Industry (Long Service Leave Funding) |
| |Amendment Bill 2009 |
|Funding Act |Coal Mining Industry (Long Service Leave Funding) |
| |Act 1992 |
|the Fund |Coal Mining Industry (Long Service Leave) Fund |
|Coal Award |Black Coal Mining Industry Award 2010 |
Clause 1 - Short title
1. This is a formal provision specifying the short title of the Act.
Clause 2 - Commencement
2. This clause provides that the Bill, when enacted, will commence on
1 January 2010.
Clause 3 - Schedule(s)
3. This clause provides that an Act that is specified in a Schedule is
amended or repealed as set out in that Schedule, and any other item
in a Schedule operates according to its terms.
4. Schedule 1 ~ Coal Mining Industry (Long Service Leave Funding) Act
1992
Item 1 - Subsection 4(1)
5. This item inserts a definition of 'black coal mining industry' into
subsection 4(1) of the Funding Act. It ensures that black coal
mining industry has the same meaning in both the Funding Act and the
Coal Award, as in force on 1 January 2010 (see especially clauses
4.2 and 4.3 of the Coal Award).
6. The term is used in the definition of 'eligible employee' and will
therefore also apply to the Coal Mining Industry (Long Service
Leave) Payroll Levy Act 1992 and the Coal Mining Industry (Long
Service Leave) Payroll Levy Collection Act 1992. This will ensure
that the term applies universally in relation to the legislation
governing long service leave in the coal mining industry.
Item 2 - Subsection 4(1) (definition of eligible employee)
7. This item amends the definition of 'eligible employee' in the
Funding Act. The new definition is consistent with the definition
of a coal mining employee in the Coal Award (see clause 4.1(b) of
the Coal Award). It also includes employees permanently employed
with a mine rescue service.
8. The legislative note makes clear that a prescription or declaration
made under item 2 may refer to a class or classes of persons who
are, or are not, eligible employees.
Item 3 - Subsection 4(1)
Item 4 - Subsection 4(1)
9. These items insert definitions of 'employee' and 'employer' into the
Funding Act. The new definitions provide that 'employee' and
'employer', respectively, mean a national system employee and
employer within the meaning of sections 13 and 14, respectively, of
the FW Act. The amendments will not apply to employees and
employers that are national system employees and employers as a
result of a reference of power by a State (see, for example, the
extended meanings set out sections 30C and 30D of the FW Act).
Item 5 - Subsection 4(2)
10. This is a technical amendment to the definition of 'eligible
employee'. As specified in the note to item 2, a prescription or
regulation made under that clause may refer to a class or classes of
persons who are, or are not, eligible employees. This is done in
reliance on section 13(3) of the Legislative Instruments Act 2003.
Item 6 - Subsection 44(3)
11. This item substitutes a new subsection 44(3) into the Act. New
subsection 44(3) ensures that, after the commencement of the NES on
1 January 2010, an employer will be reimbursed for payments made to
an eligible employee if the employee's entitlement to long service
leave is derived from any of the following:
. section 113 of the FW Act;
. a relevant industrial instrument;
. a contract of employment.
12. Importantly, this amendment provides that section 44 of the Funding
Act applies where an employee's entitlement to long service leave is
derived from section 113 of the FW Act.
13. The FW Act provides that an employee is entitled to long service
leave in accordance with the terms of applicable award-derived long
service leave terms. The definition of applicable award-derived
long service leave terms in section 113 of the FW Act preserves the
effect of long service leave terms in pre-modernised awards. The
amendments contained in Schedule 2 of the Bill extend the operation
of section 113 of the FW Act. Where an eligible employee derives
their entitlement to long service leave from section 113 of the FW
Act, their employer will be reimbursed out of the Fund.
Item 7 - Application of amendments
14. This item ensures that the amendments made in this Schedule apply in
relation to industry and employment occurring on or after
1 January 2010.
Schedule 2 ~ Long service leave entitlement
15. This Schedule extends the operation of section 113 of the FW Act by
providing that The Coal Mining Industry (Production and Engineering)
Consolidated Award 1997 will underpin the long service leave
entitlements of eligible employees who would not otherwise have an
award-derived long service leave entitlement under the National
Employment Standards. The purpose of the amendment is to ensure
that all eligible employees in the black coal mining industry, as
defined in accordance with the Modern Award, will be entitled to
long service leave under National Employment Standards from
1 January 2010.
16. Subitem (1) is an application provision. It provides that item 1 of
Schedule 2 applies to an eligible employee if there are no
applicable award-derived long service leave terms in relation to the
employee.
17. Subitem (2) is the main operative provision. It provides that The
Coal Mining Industry (Production and Engineering) Consolidated Award
1997 (the main industry award) applies to all eligible employees who
do not otherwise have an award-derived long service leave
entitlement. From 1 January 2010 this will become an applicable
award-derived long service leave term for the purpose of section 113
of the FW Act. In effect, all eligible employees who do not have an
award-derived long serve leave entitlement will be deemed to have
such an entitlement by reference to the main industry award.
18. Subitem (3) clarifies that item 1 does not affect the operation of
section 113 of the FW Act apart from this item. This ensures that
the new entitlement would be subject to the general rules that
govern the preservation of award-derived long service leave terms.
In particular, the new entitlement would be displaced by a pre-
existing workplace agreement or an AWA, or by an industrial
instrument that expressly deals with long service leave, for the
duration of the agreement or instrument. If such an agreement or
instrument ceases to apply, the employee will then be entitled to
long service leave in accordance with the new entitlement.
19. Subitem (4) defines the terms 'applicable award-derived long service
leave terms' and 'eligible employee' for the purposes of the item.