By Harold Downes, Partner and William Ash, Senior Associate
Queensland Ethical Supplier Mandate
The Queensland government has introduced an Ethical Supplier Mandate (ESM) which is being phased in to all areas of supply of goods and services to the Queensland government. The stated objective is ‘The Queensland Government’s Buy Queensland procurement approach is focused on engaging suppliers who deliver genuine, quality, secure and ongoing jobs with fair pay and safe working conditions for Queenslanders.’ It is therefore a commercial enforcement mechanism to enforce inter alia, secure, fairly paid and safe working environments.
It commenced with building and construction work on 1 August 2019. Transport, Infrastructure and Services commences on 1 October 2019 and other categories will start in 2020.
It applies to all ‘suppliers’, defined as ‘a contractor or consultant or other party to a Queensland government contract other than the Crown and its related entities, or a sub contractor to a supplier.’
The scheme is based on demerit points handed out for non-compliance with matters including state and federal work health and safety (WHS) and industrial relations legislation. Different forms of non-compliance attract different numbers of demerit points.
The Queensland Government will, unless it determines otherwise, sanction suppliers once the supplier has received 20 demerits, including deciding that the supplier cannot be awarded a contract.
Suppliers can be penalised for breaches by their sub contractors.
The guidelines also provide that the payment of wages below those provided for in an applicable modern award applies even if an employer is paying wages in accordance with a pre-reform agreement that is continued in operation by reason of Schedule 3 of the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (Cth). That is, even if there is no contravention of the Fair Work Act 2009, but the agreement is dated and wages have fallen behind.
In relation to WHS, non-compliance incudes improvement notices (and prohibition and infringement notices) (WHS Notices). A supplier would reach 20 demerit points if 10 WHS Notices are issued over three years. Given the WHS regulator’s increased focus on compliance through issuing WHS Notices, many suppliers will reach 20 demerit points based on those WHS Notices alone.
Our suggestions if you are in the supply chain for Qld Gov work
- Head Contractors will need to take reasonable action as part of their contractor management programs to ensure that sub contractors are not in breach of the ESM obligations. Contractor audits or reviews could achieve this;
- Suppliers and sub contractors will need to satisfy themselves that they comply with ESM obligations;
- Reconsider simply complying with WHSQ Notices for convenience or as a line of least resistance. Accumulating Notices could preclude you from Qld Gov work;
- Make sure that you avail yourself of the confidentiality provisions in the WHS Act
- Make sure you are compliant with industrial laws and consider whether you should be applying any old collective agreements.
Ordinary hours defined in Mondelez
The Full Court of the Federal Court recently handed down its decision, by a 2-1 majority, in Mondelez v Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union Known as the Australian Manufacturing Workers Union (AMWU)  FCAFC 138 that under the NES employees are entitled to 10 personal/carer’s leave for each year of service, regardless of the number of ordinary hours the employee would ordinarily work on those days. Many employers currently provide employees with 76 hours of paid sick leave per year, but roster employees to work for longer than 7.6 hours per day. This decision creates a contingent liability that many employers did not think they had. The decision may be appealed to the High Court.
New financial services remuneration requirements
APRA has put out a discussion paper and draft prudential standard responding to recommendations from the Royal Commission.
Among its proposals is that APRA-regulated entities would also have to ensure financial performance measures comprise less than half the criteria for variable pay for employees “across the entire organisation” under the plan, with individual financial measures to be capped at 25%.
As most incentive based payment relate to individual financial measures, if the proposed changes are made, most contracts of employments in financial services businesses will need to be re-negotiated.
Please call Harold, Will or Keisha if you want to discuss any of these topics.
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