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2010-2011
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
COAL MINING INDUSTRY (LONG SERVICE LEAVE) LEGISLATION
AMENDMENT BILL 2011
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Tertiary Education, Skills, Jobs and
Workplace Relations, Senator the Hon Chris Evans)
Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Outline
COAL MINING INDUSTRY (LONG SERVICE LEAVE) LEGISLATION
AMENDMENT BILL 2011
OUTLINE
This Bill gives effect to proposals, developed by an Industry Working Party (IWP), to reform
the long service leave arrangements in the black coal mining industry. The IWP comprised
of representatives from the NSW Minerals Council Limited, the Queensland Resources
Council, the Construction, Forestry, Mining and Energy Union - Mining and Energy
Division, the Electrical Trades Union, the Australian Manufacturing Workers Union, the
Association of Professional Engineers, Scientists and Managers Australia, the NSW Colliery
Officials Association and the Mine Managers Association of Australia.
The Bill will amend the following Acts:
· Coal Mining Industry (Long Service Leave Fund) Act 1992
· Coal Mining Industry (Long Service Leave) Payroll Levy Act 1992
· Coal Mining Industry (Long Service Leave) Payroll Levy Collection Act 1992
· Coal Mining Industry (Long Service Leave Funding) Amendment Act 2009
A priority concern of the IWP was to ensure long service leave entitlements applied
universally in the black coal mining industry. Amendments were made in 2009 to address
this concern. Schedule 2 of the Coal Mining Industry (Long Service Leave Funding)
Amendment Act 2009 (2009 Amendment Act) extended the preserved award-based long
service leave entitlements to all the eligible employees who did not otherwise have an
award-derived long service leave entitlement (non-award employees) from 1 January 2010.
The amendments contained in this Bill implement the remaining reforms proposed in the
IWP agreement.
Minimum entitlements
The Bill legislates the minimum long service leave entitlement for all eligible employees in
the black coal mining industry based on the precursor award entitlement. Provision is made
for all eligible employees - full-time, part-time and casual - to accrue long service leave in
the black coal mining industry. An eligible employee will be entitled to long service leave
when they have completed a period, or periods, of qualifying service totalling 8 years or
more.
The legislated entitlement will allow for greater clarity and transparency in the application of
the portable long service leave arrangements in the black coal mining industry.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Outline
Revised levy and employer reimbursement arrangements
The Bill changes the basis on which the levy is imposed and facilitates changes to the
employer reimbursement arrangements.
A key imperative of the IWP is to improve the operation of the scheme so that the amounts
that employers are reimbursed from the Fund in respect of long service leave payments more
closely correspond to the amounts that they have paid into the Coal Mining Industry (Long
Service Leave) Fund (the Fund) by way of levy. Accordingly, the definition of eligible
wages has been revised to reflect actual remuneration practices in the black coal mining
industry. The Bill also provides for the Board of the Coal Mining Industry (Long Service
Leave Funding) Corporation (the Corporation) to make Employer Reimbursement Rules
which will set out how the amount the Corporation will reimburse an employer is to be
determined.
Improved compliance arrangements
The Bill provides for a greater compliance role for the Corporation. The Corporation has the
power to require persons to produce information or documents and standing to pursue alleged
contraventions of a civil penalty provision on behalf of the Commonwealth. Additional
penalty provisions have been included and existing penalty levels have been increased in line
with contemporary standards.
The Board
The Bill makes changes to the structure and representation of the Board of Directors of the
Corporation to better reflect the current industry representative status of certain
employee-representative and employer-representative groups, and to increase the terms of
directors from 2 to 4 years.
Transitional arrangements
Schedule 5 establishes a regime for transition from the award-derived long service leave
scheme (preserved under section 113 of the Fair Work Act 2009 in respect of award
employees and extended to non-award employees by Schedule 2 of the 2009 Amendment
Act) to the new statutory long service leave scheme established by this Bill.
FINANCIAL IMPACT STATEMENT
This Bill does not impact on Commonwealth finances. The scheme is funded by a levy on
employers in the black coal mining industry. The levy is then applied to reimburse
employers in respect of long service leave payments made to employees.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Outline
Abbreviations used in this EM Meaning
2009 Amendment Act Coal Mining Industry (Long Service Leave
Funding) Amendment Act 2009
AAT Administrative Appeals Tribunal
Administration Act Coal Mining Industry (Long Service Leave)
Administration Act 1992 (the new title of the
Coal Mining Industry (Long Service Leave
Funding) Act 1992 as amended by this Bill)
CFMEU Construction, Forestry, Mining and Energy
Union
Corporation Coal Mining Industry (Long Service Leave
Funding) Corporation, as established by s 6
of the Funding Act
Fund Coal Mining Industry (Long Service Leave)
Fund maintained by the Corporation under
section 40 of the Funding Act
Funding Act Coal Mining Industry (Long Service Leave
Funding) Act 1992
FW Act Fair Work Act 2009
FWA Fair Work Australia
IWP Industry Working Party
Payroll Levy Act Coal Mining Industry (Long Service Leave)
Payroll Levy Act 1992
Payroll Levy Collection Act Coal Mining Industry (Long Service Leave)
Payroll Levy Collection Act 1992
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Notes on Clauses
NOTES ON CLAUSES
Clause 1 - Short title
1. This is a formal provision specifying the short title of the Act.
Clause 2 - Commencement
2. This clause specifies when the various provisions of the Act commence.
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. The Schedule contains amendments to the Coal
Mining Industry (Long Service Leave Funding) Act 1992; Coal Mining Industry
(Long Service Leave) Payroll Levy Collection Act 1992; Coal Mining Industry
(Long Service Leave) Payroll Levy Act 1992; and Coal Mining Industry (Long
Service Leave Funding) Amendment Act 2009.
4. Any other item in a Schedule operates according to its terms.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 1 - Part 1
SCHEDULE 1 - LONG SERVICE LEAVE ENTITLEMENT
Overview
5. The amendments in Part 1 of Schedule 1 establish a statutory long service leave
scheme for all eligible employees in the black coal mining industry and provide for
consequential amendments. All eligible employees - full-time, part-time or casual
- will be entitled to accrue qualifying service and long service leave credits under
this scheme.
6. An eligible employee will be entitled to long service leave when they have
completed a period, or periods, of qualifying service of 8 years or more. An
employee will be permitted to have breaks in service in the black coal mining
industry of no more than 8 continuous years without losing the periods of qualifying
service accrued. Long service leave credit will be calculated in accordance with the
formula set out in clause 39AA.
7. An employee who ceases to be an eligible employee may be paid for their accrued
long service leave credits even if they have not qualified for a long service leave
entitlement in certain circumstances.
8. This Part also contains provisions which would enable certain types of employees to
enter into an agreement with their employer which diverts the payroll levy which
would have been payable by the employer to fund the long service leave
entitlements of the employee into other payments for the benefit of the employee, for
example additional superannuation contributions. The types of employees eligible
to enter into such waiver agreements will be specified in regulations. These are
expected to include employees who are unlikely to accrue enough qualifying service
to take long service leave or are unlikely to take long service leave even where they
have accrued an entitlement.
9. FWA will be empowered to deal with disputes relating to long service leave.
Breaches of this Part will be civil penalty provisions actionable in the Federal Court
or the Federal Magistrates Court.
10. The amendments in Part 2 of Schedule 1 relate to reimbursements made by the
Corporation in relation to long service leave payments made by employers under
Part 5A of the Act. One of the key changes to the scheme agreed by the IWP is in
the calculation of the amount that an employer is to be reimbursed. The intention is
that the reimbursement amount in respect of a long service leave payment made to
an employee should correspond more closely to the amount that has been paid into
the Fund in relation to that employee. This Part provides for the Board of the
Corporation to make Employer Reimbursement Rules which will relate to the
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Explanatory Memorandum - Schedule 1 - Part 1
amount that an employer is to be reimbursed for a payment by the employer to an
employee under Part 5A. It is intended that the method of calculating the
reimbursement amount will differ depending on whether the employee's qualifying
service relates to before, or on or after, 1 January 2012.
11. In addition, this Part includes a revised provision in relation to the payment of the
Corporation to an employee or their representative, where the employer is insolvent,
being wound up or no longer exists.
12. Part 3 of Schedule 1 includes amendments relating to the title and objects of the
Funding Act, which will be renamed the Coal Mining Industry (Long Service Leave)
Administration Act 1992. Part 3 also includes consequential amendments to the
Payroll Levy Act and the Payroll Levy Collection Act as a result of these changes.
PART 1 - MAIN AMENDMENTS
Coal Mining Industry (Long Service Leave Funding) Act 1992
Items 1 to 23 - subclause 4(1) - definitions
13. Items 1 to 23 insert definitions into the Funding Act, which will be renamed the
Coal Mining Industry (Long Service Leave) Administration Act 1992.
Item 24 - after paragraph 7(d) - maintaining records as a function of the Corporation
14. Item 24 inserts paragraph 7(da), which will give the Corporation the new function of
maintaining records relating to the employment of eligible employees, the qualifying
service completed by eligible employees, the long service leave entitlements of
eligible employees, the employers of eligible employees and the amounts that are, or
may become, payable to employers under Part 7.
15. The Corporation's records will allow eligible employees, former eligible employees
and employers to verify with the Corporation the amount of qualifying service an
employee has completed, their long service leave entitlements and amounts that may
be payable to employers.
Item 25 - after Part 5 - entitlement to long service leave
16. Item 25 inserts Part 5A which deals with an eligible employee's entitlement to long
service leave.
Part 5A - Entitlement to long service leave
Division 1 - Entitlement, amount and grant, etc.
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Explanatory Memorandum - Schedule 1 - Part 1
17. An employee who is an eligible employee will be entitled to long service leave when
they have completed 8 years of qualifying service. The amount of long service leave
the employee becomes entitled to after 8 years of qualifying service will be
calculated using a formula which includes the employee's working hours. Rules
will apply as to how the employee is able to take their long service leave and how
the employee may be paid for the period of their leave.
Clause 39A - Entitlement to long service leave
18. Subclause 39A(1) provides that an employee who is an eligible employee will be
entitled to long service leave when they have completed a period, or periods, of
qualifying service that adds up to at least 8 years. The 8 year total can be reached by
one 8 year period of qualifying service or by adding together two or more periods of
qualifying service (so long as those periods are not separated by a break of more
than 8 years).
Qualifying service
19. Subclause 39A(2) defines qualifying service as a period when an employee is an
eligible employee by one or more employers.
20. LSL credit can only be accrued during periods of qualifying service.
21. A period during which an eligible employee is on leave or is absent from work will
be a period of qualifying service unless it has been expressly excluded by subclause
39A(2). The periods which will not count as qualifying service are:
· a period of unauthorised absence;
· a period of unpaid leave or unpaid authorised absence, other than:
o a period of absence under Division 8 of Part 2-2 of the FW Act (which
deals with community service leave); or
o a period of stand down under Part 3-5 of the FW Act; or
o a period during which the employee is absent from work because of a
personal illness, or a personal injury, for which the employee is
receiving compensation under a law of the Commonwealth, a State or a
Territory that is about workers' compensation or under an industrial
instrument; or
o a period of leave or absence so prescribed by regulation;
· if an employee ceases to be an eligible employee for a continuous period of 8
years or more, any period before the break period of 8 years or more;
· a period of unauthorised absence;
· any period where a waiver agreement is in effect between the employee and an
employer;
· any period so prescribed by regulation.
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Explanatory Memorandum - Schedule 1 - Part 1
22. To avoid doubt, the following periods of absence will be counted as a period of
qualifying service:
· a period of absence under Division 8 of Part 2-2 of the FW Act (which deals
with community service leave);
· a period of stand down under Part 3-5 of the FW Act;
· a period during which the employee is absent from work because of a personal
illness, or a personal injury, for which the employee is receiving compensation
under a law of the Commonwealth, a State or a Territory that is about workers'
compensation or under an industrial instrument;
· a period of leave or absence so prescribed by regulation.
23. An employee will only be able to accrue a maximum one week of qualifying service
each week. For example, an employee who works for two employers during the
course of one week will only accrue one week of qualifying service for that week.
24. Historically, where there were breaks in service that exceeded 3 months, the Coal
Industry Tribunal or the Australian Industrial Relations Commission determined
`bridging applications' if the relevant union or employer organisation could not
agree on an application. Legislating to allow for breaks of up to 8 years gives
greater transparency and certainty to the process for employees and employers in the
black coal mining industry. The 8 year break period was agreed upon by the IWP as
representing a period that arbitrators never exceeded under the old bridging
application system.
Calculation of qualifying service for casuals
25. A casual employee's qualifying service will be calculated in one week units. Where
a casual employee is an eligible employee at any time during a week, the employee
will be taken to have been an eligible employee for the whole week.
26. For example, where a casual employee works one shift during a week, the employee
will accrue one week of qualifying service. Where a casual employee works one
shift which spans two weeks (by starting at the end of one week and finishing at the
beginning of another), the employee will accrue two weeks of qualifying service.
Effect of break period once entitled to long service leave
27. Subclause 39A(4) provides that, despite paragraph 39A(2)(c), if an eligible
employee became entitled to long service leave and did not take that long service
leave before ceasing to be an eligible employee for 8 or more years, the employee
will upon being an eligible employee once more be entitled to count periods of
service before their 8 or more year break as qualifying service.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 1 - Part 1
Example
39A(2)(c) 39A(4)
Jean was an eligible employee Scott was an eligible employee
Jean did not become entitled to long Scott became entitled to long
service leave while she was an service leave while he was an
eligible employee eligible employee but did not take it
Jean then ceases to be an eligible Scott then ceases to be an eligible
employee for 8 or more years employee for 8 or more years
Jean then becomes an eligible Scott then becomes an eligible
employee again employee again
Jean will not be able to count for the Scott will be able to count for the
purposes of qualifying service any purposes of qualifying service the
period which occurred before her periods which occurred before his
break of 8 or more years break of 8 or more years
Clause 39AA - Amount of long service leave
28. Subclauses 39AA(1) and (2) will contain the formula to be used for calculating the
number of hours of longer service leave that an eligible employee will entitled to for
a week of qualifying service completed by the employee. The formula is:
x working hours
29. In the formula, 13 relates to weeks of long service leave the employee will become
entitled to and 416 relates to the number of weeks of qualifying service over the 8
years needed to qualify for long service leave (i.e. 8 x 52 weeks = 416 weeks).
Working hours
30. Working hours will have a different meaning for full-time, part-time and casual
employees.
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Explanatory Memorandum - Schedule 1 - Part 1
31. It will not be possible for any employee to have more than 35 working hours during
one week for the purposes of long service leave accrual.
32. For a person who is a full-time employee at all times during the week, working
hours will mean 35 hours. This will be the case even if the employee actually works
more or less than 35 hours during the week.
33. For a person who is a part-time employee at any time during the week, working
hours will mean the lesser of (or either of, if they are equal) the total number of
ordinary hours of work of the employee, or 35 hours. Ordinary hours of work is
defined in subclause 4(1).
34. For a person who is a casual employee at any time during the week (and was not a
part-time employee at any time during the week), working hours will mean the lesser
of (or either of, if they are equal) the total number of hours worked by the employee
as a casual employee during the week, or 35 hours.
Clause 39AB - Grant of long service leave
35. Subclause 39AB(1) allows an eligible employee to apply, in writing, to his or her
employer to take a period of long service leave. While there are no requirements
about how much notice an eligible employee will be required to give his or her
employer for this purpose, an employer may refuse to grant the employee's
application to take long service leave under reasonable business grounds under
subclause 39AB(4) if not enough notice is given by the employee.
36. An employee will only be able to apply to take a period of long service leave that is
a single continuous period of at least 14 days.
37. Also, an employee may only apply to take long service leave if the period they are
applying for does not exceed the employee's LSL credit at the time the leave is to be
taken.
38. The note to subclause 39AB(2) alerts the reader that an employee is not taken to be
on long service leave on public holidays and during certain other periods of absence,
as set out in clause 39AE.
39. As soon as practicable, but no later than 14 days after the application is made, the
employer must give the employee a written response stating whether or not the
employer grants the long service leave and if the employer refuses to grant the long
service leave, the reasons for the refusal. For this purpose, 14 days means 14
calendar days. Subclause 39AB(6) provides that this will be a civil penalty
provision.
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Explanatory Memorandum - Schedule 1 - Part 1
40. An employer may only refuse to grant long service leave on reasonable business
grounds. Subclause 39AB(6) provides that this will be a civil penalty provision.
FWA will have jurisdiction to deal with disputes about long service leave, including
an employer's refusal to grant long service leave (see clause 39D).
Meaning of LSL credit
41. The long service leave credit (LSL credit) of an employee on any particular day is
calculated by adding the number of hours of long service leave that the employee is
entitled to under clause 39AA for each week of qualifying service completed by the
employee before the calculation, less the number of hours of long service leave (if
any) granted to the employee under this clause.
42. LSL credit can only be accrued during periods of qualifying service.
Example
Xavier is a full-time eligible employee who has completed 12 years of qualifying
service. Using the formula in clause 39AA, it is calculated that he is entitled to
682.5 hours of long service leave.
x (35 hours x 52 weeks x 12 years) = 682.5
Xavier has previously taken 102 hours of long service leave under clause 39AA.
Xavier's LSL credit is 580.5 hours (682.5 - 102).
43. The note to subclause 39AB(5) informs the reader that the number of hours of long
service leave that an employee is entitled to in respect of certain qualifying service
may be affected by clause 39CE. Clause 39CE deals with the effect of payment in
respect of qualifying service.
44. The amount of LSL credit to be deducted from an employee's account will be
determined by the number of hours they are paid for during their long service leave
which will be subject to agreement between the employer and the employee.
Example
Erik works part-time for eight hours a day, three days a week and wants to take
two weeks' long service leave. Erik elects to be paid at his usual part-time rate for
the period during which he is on long service leave. He will be paid for (and have
deducted from his LSL credit) 48 hours while he is on long service leave. Erik's
LSL credit is only deducted by the amount of hours he is paid for (48 hours),
regardless of the amount of time he is absent from work (14 days).
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 1 - Part 1
Clause 39AC - Payment for long service leave
45. If an eligible employee takes a period of long service leave, the employer will be
required to pay the employee for the long service leave no less than the base rate of
pay before any amounts are deducted under a salary sacrifice arrangement and
including incentive-based payments and bonuses that would have been payable to
the employee during the period had the employee not taken the leave. Subclause
39AC(2) provides that this will be a civil penalty provision.
46. The notes to subclause 39AC(2) point the reader to Part 7A and Division 4 of Part 5
which provide pecuniary and other penalties for contraventions of civil penalty
provisions.
47. For the purposes of this clause, base rate of pay is the base rate of pay before any
amounts are deducted under a salary sacrifice arrangement. An incentive-based
payment is one that is paid to the employee at least once a month, and a bonus is one
that is paid to the employee at least once a month.
Clause 39AD - Manner of payment for long service leave
48. If an eligible employee takes a period of long service leave, the employer will be
required to pay the employee for the long service leave either at the same time as the
employer would have paid the employee during the period if the employee had not
taken the leave or, if the employee's industrial instrument expressly permits the
employee to be paid in advance, and the employee requests to be paid in advance, in
accordance with the employee's request.
49. The two options for payment are mutually exclusive. An employee will be required
to make a choice between being paid in advance for all of the long service leave and
being paid at the same time as they would normally have been paid during the
period.
50. Subclause 39AD(2) provides that this will be a civil penalty provision.
51. The notes to subclause 39AD(2) point the reader to Part 7A and Division 4 of Part 5
which provide pecuniary and other penalties for contraventions of civil penalty
provisions.
Clause 39AE - Public holidays etc. not to count as long service leave
52. Subclause 39AE(1) provides that if a period during which an eligible employee is on
long service leave includes a day or part-day that is a public holiday in the place
where the employee is based for work purposes, the employee will be taken not to be
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Explanatory Memorandum - Schedule 1 - Part 1
on long service leave on that whole day, and the public holiday is taken not to break
the continuity of the long service leave.
Example
Ororo has taken 14 days of long service leave. The fourth day of her long service
leave happens to be a public holiday (Mackay Show Day) in Mackay, Queensland
where she lives. Ororo is taken not to be on long service leave for the whole of that
day. Ororo is paid for Mackay Show Day as she would be paid for a public holiday
if she were not on long service leave. Mackay Show Day is taken not to break the
continuity of Ororo's long service leave, and despite not being taken to be on long
service leave that day, Ororo still fulfils the requirement under paragraph
39AB(2)(a) that an employee may only apply to take a period of long service leave
that is a single continuous period of at least 14 days.
53. Subclause 39AE(2) provides that if a period during which an eligible employee is on
long service leave includes a period of absence from employment under Division 8
of Part 2-2 of the FW Act (which deals with community service leave), the
employee is taken not to be on long service leave for the period of absence, and the
period of absence is taken not to break the continuity of the long service leave.
Example
Andrew has taken 14 days of long service leave. During his period of long service
leave, Andrew spends three days on jury duty. Andrew is taken not to be on long
service leave for those three days. Andrew is paid for those three days as he would
be paid for a period of absence from employment under Division 8 of Part 2-2 of
the FW Act if he were not on long service leave. The three days of jury duty are
taken not to break the continuity of Andrew's long service leave, and despite not
being taken to be on long service leave for those days, Andrew still fulfils the
requirement under paragraph 39AB(2)(a) that an employee may only apply to take
a period of long service leave that is a single continuous period of at least 14 days.
Division 2 - Waiver agreements
54. In certain circumstances, an eligible employee may be unlikely to either accrue
enough qualifying service or LSL credit to take long service leave, or unlikely to
take long service leave even if they have accrued the necessary qualifying service or
LSL credit.
55. As such an employee would not take long service leave under this scheme, their
employer would not need to claim reimbursement from the Fund in respect of the
employee even though the employer will have paid levy in respect of that employee.
To negate the need of an employer of such an eligible employee to pay the payroll
levy, the employer and employee may enter into a waiver agreement. Under a
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Explanatory Memorandum - Schedule 1 - Part 1
waiver agreement, the employer would be required to make payments for the benefit
of the employee (e.g. additional remuneration or superannuation contributions) in
lieu of paying levy. An employee who is party to a waiver agreement will not
accrue qualifying service while the waiver agreement is in place.
Clause 39B - Waiver agreements may be made with certain employees
56. As an alternative to paying the levy in clause 4 of the Payroll Levy Collection Act,
an employer may in certain circumstances make a waiver agreement with a
prescribed employee. The kinds of employees who will be able to make a waiver
agreement will be prescribed by regulations.
57. An employee who is party to a waiver agreement does not accrue qualifying service
for the time that they are covered by the waiver agreement (see paragraph
39A(2)(c)).
58. A waiver agreement allows an employer to either pay additional remuneration to the
employee as directed by the employee, or make additional contributions for the
employee's benefit to a superannuation fund nominated by the employee in lieu of
paying the payroll levy payable by the employer in respect of eligible wages paid to
the employee.
59. The value of the additional remuneration, contributions or both must be equal to or
greater than the payroll levy the employer would otherwise have been required to
pay
60. If the rate of the payroll levy changes during the life of a waiver agreement so that
the value of the additional remuneration or contributions (or both) is no longer equal
to or greater than the amount of payroll levy that would have been payable by the
employer in respect of eligible wages paid to the employee had the waiver
agreement not been in effect, the waiver agreement will be need varied in
accordance with the terms of the agreement (see subclause 39B(2)).
61. Subclauses 39B(3) and (4) specify the form and content of a waiver agreement.
Subclause 39B(5) requires the employer to lodge a waiver agreement with the
Corporation as soon as it is practicable. The waiver agreement cannot take effect
until after it has been lodged with the Corporation.
62. A waiver agreement will take effect from the date that it is specified to take effect
(but that date must be after it is lodged with the Corporation). It will continue to
have effect until the Corporation refuses to approve it (under 39BC(5)), it is
terminated under clause 39BB or the employee ceases to be an eligible employee or
prescribed employee of a kind mentioned in subclause 39B(1).
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Explanatory Memorandum - Schedule 1 - Part 1
Clause 39BA - Variation of waiver agreements
63. If a waiver agreement is in effect between an employee and an employer, the
employee and employer may agree to vary the agreement.
64. The form of the variation is set out in subclause 39BA(2). Subclause 39BA(3)
requires the employer to lodge a varied waiver agreement with the Corporation as
soon as it is practicable. The variation will have no effect until the varied waiver
agreement has been lodged with the Corporation.
Clause 39BB - Termination of waiver agreements
65. If a waiver agreement is in effect between an employee and an employer, the
employee and employer may agree to terminate the agreement. The employer may
only refuse to terminate a waiver agreement if the employer has reasonable grounds
to do so.
66. The form of the termination is set out in subclause 39BB(3). Subclause 39BB(4)
requires the employer to give the Corporation written notice of the termination,
including the date on which the waiver agreement terminates.
Clause 39BC - Approval of wavier agreements and variations by the Corporation
67. The Corporation has the power to refuse to approve a waiver agreement or variation
of a waiver agreement. Within 30 days after a waiver agreement or a varied waiver
agreement is lodged with the Corporation, the Board must decide to approve or
refuse to approve the agreement or variation and give the parties to the agreement
written notice of the decision. If the Board does not decide within the 30 day time
period, the Board will be taken to have approved the waiver agreement or variation.
68. If the Board refuses to approve a waiver agreement or variation, the Board must set
out the reasons for the refusal and include a statement informing the parties that an
application may be made to the AAT for review of the Board's decision.
69. In the event that the Board refuses to approve a waiver agreement, the agreement
ceases to have effect on the day the parties are notified of the Board's refusal to
approve. The waiver agreement will still have been in effect and valid for the period
between lodgement with the Corporation and notification of the Board's refusal to
approve. No back-payment of the levy will be necessary by the employer for the
period of time during which the waiver agreement was in effect.
70. In the event that the Board refuses to approve a variation of a waiver agreement, the
variation ceases to have effect on the day the parties are notified of the Board's
refusal to approve. The varied terms of waiver agreement will still have been in
effect and valid for the period between lodgement with the Corporation and
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Explanatory Memorandum - Schedule 1 - Part 1
notification of the Board's refusal to approve but upon receipt of notification from
the Board of the Board's refusal to approve the variation, the original terms of the
waiver agreement will apply.
71. The Board may only approve a waiver agreement or variation if the Board is
satisfied that all the requirements in subclause 39BC(3) have been met. This is to
ensure that the waiver agreement or variation is a genuine agreement between the
parties who are permitted to make such an agreement.
Clause 39BD - Effect of waiver agreements on payroll levy
72. The effect of clause 39BD is that no levy under section 4 of the Levy Collection Act
is payable by any employer of an employee who is party to a waiver agreement.
73. The note to 39BD clarifies to the reader that returns made by the employer under
section 5 of the Payroll Levy Collection Act while the waiver agreement is in effect
will still need to include information in relation to the employee.
Division 3 - Payments on cessation of employment as an eligible employee
74. In a number of circumstances, an eligible employee who has accrued some amount
of qualifying service and LSL credit may cease to be employed, or employed as an
eligible employee, within the black coal mining industry. Division 3 provides the
circumstances in which such an employee may be paid for their LSL credit.
Clause 39C - Payment on cessation - general
75. Clause 39C deals with payment where an employee ceases to be an eligible
employee and, at the time of ceasing to be an eligible employee, has a period of
untaken long service leave under Part 5A.
76. Under subclause 39C(1), such an employee will be able to make a request in writing
to their employer for a payment and the employer must, within 30 days after the
request, pay the employee no less than the amount that would have been payable to
the employee under Part 5A had the employee taken the period of long service leave
immediately before ceasing to be an eligible employee, less any amount previously
paid to the employee under the clause.
77. If the employee dies before they make the request to their employer, subclause
39C(2) will allow the employee's legal personal representative the same rights that
the employee has under subclause (1). However, if the employee has died, the
amount payable to their legal personal representative must be no less than the
amount that would have been payable under Part 5A had the employee taken all their
untaken long service leave at the time they ceased to be an eligible employee.
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Explanatory Memorandum - Schedule 1 - Part 1
78. The employee is entitled to be paid for their untaken long service leave as it is an
entitlement they have accrued.
79. Subclauses 39C(1) and (2) are civil penalty provisions and the notes point the reader
to Part 7A and Division 4 of Part 5A part which provide pecuniary and other
penalties for contraventions of civil penalty provisions.
Clause 39CA - Payment on cessation - ill health and retirement
80. Clause 39CA deals with payment where an employee ceases to be an eligible
employee because of ill health or because of retirement on or after 60 years of age
and the employee has completed a period or periods of qualifying service but is not
yet entitled to long service leave.
81. Such an employee will be able to make a request in writing to their employer for a
payment and, under subclause 39C(2), the employer must, within 30 days after the
request, pay the employee no less than the amount that would have been payable to
the employee under Part 5A had the employee been entitled to long service leave for
the period of qualifying service and taken the period of long service leave
immediately before ceasing to be an eligible employee, less any amount previously
paid to the employee under this clause.
82. The employee is entitled to be paid for what LSL credit they have accrued, even
though they have not accrued a long service leave entitlement, as an
acknowledgment that the employee is unlikely or may be unable to return to the
black coal mining industry.
83. Subclauses 39C(1) and (2) are a civil penalty provisions and the notes to point the
reader to Part 7A and Division 4 of Part 5A which provide pecuniary and other
penalties for contraventions of civil penalty provisions.
Clause 39CB - Payment on cessation - redundancy
84. Clause 39CB deals with payment where an employee ceases to be an eligible
employee because of redundancy and has completed at least 6 years of qualifying
service.
85. Such an employee will be able to make a request in writing to their employer for a
payment and, under subclause 39CB(2), the employer must, within 30 days after the
request, pay the employee no less than the amount that would have been payable to
the employee under Part 5A had the employee been entitled to long service leave for
the period of qualifying service and taken the period of long service leave
immediately before ceasing to be an eligible employee, less any amount previously
paid to the employee under this clause.
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Explanatory Memorandum - Schedule 1 - Part 1
86. The employee is entitled to be paid for the LSL credit they have accrued, even
though they have not accrued a long service leave entitlement, as an
acknowledgement that the employee ceased to be an eligible employee because of
redundancy.
87. Subclauses 39CB(1) and (2) are civil penalty provisions and the notes point the
reader to Part 7A and Division 4 of Part 5A which provide pecuniary and other
penalties for contraventions of civil penalty provisions.
Clause 39CC - Payment on cessation - death
88. Clause 39CC deals with payment where an eligible employee dies, whether they
have a period of untaken long service leave or were not yet entitled to long service
leave but had completed any period or periods of qualifying service.
89. If, at the time of the employee's death, the employee had a period of untaken long
service leave under Part 5A, the employer must, within 30 days after the request is
made by the employee's legal personal representative, pay the employee's legal
personal representative no less than the amount that would have been payable to the
employee under Part 5A had the employee taken all their untaken long service leave
immediately before the employee died.
90. If, at the time of the employee's death, the employee was not yet entitled to long
service leave but had completed any period or periods of qualifying service, the
employer must, within 30 days after the request is made by the employee's legal
personal representative, pay the employee's legal personal representative no less
than the amount that would have been payable to the employee under Part 5A had
the employee been entitled to long service leave for the period of qualifying service
and taken all of the period of long service leave immediately before the employee
died.
91. The provisions which require the employer to make the payment are civil penalty
provisions and the notes point the reader to Part 7A and Division 4 of Part 5A that
provide pecuniary and other penalties for contraventions of civil penalty provisions.
Clause 39CD - Effect of payment in respect of untaken long service leave
92. Clause 39CD makes it clear that a payment upon the death of an employee in respect
of a period of untaken long service leave will extinguish the employee's entitlement
under Part 5A to the period of untaken long service leave.
Clause 39CE - Effect of payment in respect of qualifying service
93. Subclauses 39CE(1) and (2) outline when qualifying service will continue to be
counted as qualifying service for the purposes of subclause 39A(1) where an
employee has been paid an amount under clause 39CA or 39CB.
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Explanatory Memorandum - Schedule 1 - Part 1
94. If an employee has been paid an amount under the `ill health and retirement' or
`redundancy' payment provisions and becomes an eligible employee again within 8
years of ceasing to be an eligible employee, their qualifying service (for which they
were paid an amount) will continue to be a period of qualifying service.
95. However, if that employee subsequently becomes entitled to long service leave in
respect of that period of qualifying service, they will not be entitled for any hours of
long service leave in respect of that qualifying service.
96. Subclause 39CE(4) makes clear that an employer need only ever make one payment
in respect of any particular period of an employee's qualifying service.
Division 4 - Remedies relating to long service leave
Subdivision A - FWA
Clause 39D - FWA may deal with disputes relating to long service leave
97. Clause 39D gives FWA jurisdiction to deal with an LSL dispute arising under Part
5A. FWA's jurisdiction here is modelled on FWA's power to deal with a dispute
about the National Employment Standards.
Subdivision B - Court orders
Clause 39DA - Employees etc. may apply to court in respect of certain
contraventions
98. Clause 39DA gives the Federal Court and the Federal Magistrates Court jurisdiction
to deal with a contravention or proposed contravention of a civil penalty provision
under this Part, and also gives standing to employees, employee organisations and
industrial associations to apply to the Federal Court or Federal Magistrates Court in
certain circumstances.
99. The Federal Magistrates Court may provide a simpler and less expensive jurisdiction
for employees.
Clause 39DB - Orders that can be made by the court
100.Clause 39DB allows the Federal Court and the Federal Magistrates Court to make
orders arising from a contravention or proposed contravention of a civil penalty
provision under this Part awarding compensation, granting an injunction or interim
injunction or any other order that the court considers necessary.
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Explanatory Memorandum - Schedule 1 - Part 1
Division 5 - Relationship with other laws and industrial instruments
Clause 39E - Relationship with the National Employment Standards
Clause 39EA - Relationship with State and Territory long service leave laws
101.These clauses make it clear that this Part applies to eligible employees and their
employers to the exclusion of the provisions in the National Employment Standards
dealing with long service leave and any State or Territory laws dealing with long
service leave.
Clause 39EB - Relationship with industrial instruments
102.Clause 39EB makes it clear that this Part establishes minimum entitlements and
rights in respect of long service leave for eligible employees and does not override
more beneficial entitlements or rights arising from an industrial instrument that
covers the employee.
Division 6 - Miscellaneous
Clause 39F - Entitlements and rights in respect of long service leave subject to
alteration, cancellation etc.
103.Clause 39F makes clear that any benefits or rights in respect of long service leave
are subject to cancellation, revocation, termination or variation under legislation and
no compensation is payable in that event.
Item 26 - after Part 7 - civil penalty orders
104.Item 26 inserts Part 7A, which deals with civil penalty orders.
Part 7A - Civil penalty orders
Division 1- Obtaining a civil penalty order
Clause 49A - Civil penalty orders
105.Clause 49A deals with the enforcement of civil remedy provisions by a court.
106.Subclause 49A(1) provides that the Corporation has standing to, on behalf of the
Commonwealth, apply to the Federal Court or the Federal Magistrates Court seeking
an order that a person alleged to have contravened a civil penalty provision pay the
Commonwealth a pecuniary penalty. Subclause 49A(2) provides that such an
application must be made within 6 years of the alleged contravention.
107.Subclause 49(3) provides that the Court, if satisfied that a person has contravened
the civil penalty provision, may order a person to pay to the Commonwealth a
pecuniary penalty as determined by the court. Subclauses 49(5) and 49(6) set the
maximum pecuniary penalty. The maximum penalty is higher under the
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Explanatory Memorandum - Schedule 1 - Part 1
Administration Act than the Payroll Levy Collection Act and the maximum penalty
is 5 times higher for a Corporation than an individual.
108.Subclause 49A(7) sets out the relevant matters that the court may take into account
in determining the pecuniary penalty.
Clause 49AA - Civil enforcement of penalty
109.Clause 49AA provides that a pecuniary penalty is a debt payable to the
Commonwealth and enforceable as a judgement debt.
Clause 49AB - Conduct contravening more than one civil penalty provision
110.Clause 49AB is a standard double jeopardy provision. It provides that if conduct
contravenes more than one civil penalty provision proceedings may be instituted
under this Division against a person in relation to the contravention of any one or
more of those provisions. However, subclause 49AB(2) provides that a person will
not be liable to more than one pecuniary penalty under a law of the Commonwealth
in relation to the same conduct.
Clause 49AC - Multiple contraventions
111.Clause 49AC provides for the circumstance in which a court may make a single civil
penalty order against a person for multiple contraventions of a civil penalty
provision.
112.Subclause 49AC(2) provides that the penalty must not exceed the sum of the
maximum penalties that could be ordered if a separate penalty were ordered for each
of the contraventions.
Clause 49AD - Proceedings may be heard together
113.Clause 49AD provides that the court may direct that 2 or more proceedings for civil
penalty orders be heard together.
Clause 49AE - Civil evidence and procedure rules for civil penalty orders
114.Clause 49AE provides that a court must apply the rules of evidence and procedure
for civil matters when hearing and determining an application relating to a
contravention, or proposed contravention, of a civil penalty provision.
Clause 49AF - Contravening a civil penalty provision is not an offence
115.Clause 49AF makes it clear that a contravention of a civil remedy provision is not a
criminal offence and therefore cannot result in a criminal conviction.
Division 2 - Civil proceedings and criminal proceedings
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Explanatory Memorandum - Schedule 1 - Part 1
116.Division 2 includes provisions which support the operation of the dual civil and
criminal penalty regime.
Clause 49B - Civil proceedings after criminal proceedings
117.Clause 49B prevents a court making a civil penalty order against a person for a
contravention of a civil penalty provision if the person has been convicted of an
offence for the same, or substantially the same, conduct.
Clause 49BA - Criminal proceedings during civil proceedings
118.Subclause 49BA(1) provides that where criminal proceedings are commenced or
have already been commenced against the person for an offence and the offence is
constituted by the same, or substantially the same, conduct the proceedings for a
civil penalty order are stayed.
119.Subclause 49BA(2) provides that if the person is not convicted the proceedings may
be resumed but otherwise they are to be dismissed.
Clause 49BB - Criminal proceedings after civil proceedings
120.Clause 49BB makes it clear that regardless of whether a civil penalty order has been
made against a person in relation to the contravention criminal proceedings may be
commenced against a person for the same or substantially the same contravention.
Clause 49BC - Evidence given in civil proceedings not admissible in criminal
proceedings
121.Subclause 49BC(1) provides that evidence given by an individual in civil
proceedings is not admissible in criminal proceedings against that individual.
122.Subclause 49BC(2) provides that subclause 49BC(1) does not apply to criminal
proceedings in relation to the falsity of the evidence given by the individual in the
proceedings for the civil penalty order.
Division 3 - Miscellaneous
Clause 49C - Ancillary contravention of civil penalty provisions
123.Clause 49C sets out the range of ancillary contraventions of the civil penalty
provisions which are taken to be contraventions.
Clause 49CA - Continuing contraventions of civil penalty provisions
124.Subclause 49CA(1) provides that if an act or thing is required under a civil penalty
provision to be done within a particular period or before a particular time then the
obligation to do that act or thing continues until the act or thing is done regardless of
whether the period has expired or the time has passed.
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Explanatory Memorandum - Schedule 1 - Part 1
125.Subclause 49CA(2) provides that a person who contravenes a civil penalty provision
that requires an act or thing to be done within a particular period or before a
particular time commits a separate contravention of that provision in respect of each
day during which the contravention occurs. This includes the day the relevant civil
penalty is made or any day later.
Clause 49CB - Mistake of fact
126.Clause 49CB sets out the circumstances which will establish the defence of mistake
of fact against an alleged contravention of a civil penalty provision.
Clause 49CC - State of mind
127.Clause 49CC provides that it is not necessary to prove a person's state of mind,
including intention, knowledge, recklessness or negligence for any contravention of
a civil penalty provision other than subclause 49C(1).
Clause 49CD - Civil penalty provisions contravened by employees, agents or
officers
128.Clause 49CD provides that if an element of a civil penalty provision is done by an
employee, agent or officer of a body corporate and that person is acting within the
scope of his or her employment or within his or her authority then the element of the
civil penalty provision is to be attributed to the body corporate.
Clause 49CE - Civil penalty provisions contravened by executive officers
129.Clause 49CE sets out the range of circumstances in which an executive officer of a
body corporate will be taken to have contravened the civil penalty provisions when
the body corporate has contravened the civil penalty provision.
Clause 49CF - Establishing whether an executive officer took reasonable steps to
prevent the contravention of a civil penalty provision
130.Clause 49CF sets out the circumstances the court is to have regard to in establishing
whether an executive officer took reasonable steps to prevent the contravention of a
civil penalty provision for the purposes of clause 49CE.
Item 27 - subsection 50(1)
Item 28 - after subsection 50(1) - delegation to a Director only
131.Item 28 inserts a new provision subsection (1A) that provides that the Corporation's
power to issue a notice to produce may only be delegated to an officer of the
Corporation. The definition of `officer' in the Commonwealth Authorities and
Companies Act 1997 is referred to. A director or senior manager of the Corporation
will be able to issue a notice requiring a person to produce information or documents
under clause 52A.
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Explanatory Memorandum - Schedule 1 - Part 1
132.Item 27 makes a consequential amendment to subsection 50(1).
Item 29 - after section 52 - power to require persons to produce information or
documents
133.Item 29 inserts new provisions relating to the power of the Corporation to require
persons to produce information or documents, merits review of certain decisions by
the Corporation and the jurisdiction and powers of the Federal Court and the Federal
Magistrates Court.
Clause 52A - Power to require persons to produce information or documents
134.Subclause 52A(1) provides that the section applies if the Corporation believes on
reasonable grounds that a person has information, or a document containing
information, of any of the specified kinds.
135.Subclause 52A(2) provides that the Corporation is able to by written notice require
the person to give the information to the Corporation by the time, and in the manner
and form, specified in the notice, or produce the document, or a certified copy of the
document, to the Corporation by the time, and in the manner, specified in the notice.
136.Importantly, the privilege against self-incrimination and legal professional privilege
are not affected by clause 52A.
Clause 52B - Review by the Administrative Appeals Tribunal
137.Clause 52B provides that certain decisions of the Board of the Corporation can be
reviewed by the AAT.
138.An employee or employer to whom the decision relates can apply to the AAT for a
review of a decision by the Board under subclause 44(1) or (2) which relate to
reimbursement for payments relating to long service leave, a decision by the Board
to refuse to approve a waiver agreement under clause 39BC and a decision by the
Board to refuse to approve a variation of a waiver agreement under clause 39BC.
Clause 52C - Conferral of jurisdiction on the Federal Court and the Federal
Magistrates Court
139.Subclause 52C(1) provides that jurisdiction is conferred on the Federal Court and the
Federal Magistrates Court in relation to any civil matter arising under the
Administration Act or the Payroll Levy Collection Act.
140.Subclause 52C(2) provides for the circumstances in which the jurisdiction conferred
on the Federal Court under subclause (1) is to be exercised in the Fair Work
Division of the Federal Court.
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Explanatory Memorandum - Schedule 1 - Part 1
Clause 52D - Powers of courts
141.Clause 52D makes clear that the powers conferred on the Federal Court and the
Federal Magistrates Court are in addition to, and not instead of, any other powers of
the Court.
Item 30 - section 54
Item 31 - at the end of section 54 - regulations
142.Item 31 inserts a new subsection in section 54 which allows for Regulations to be
made requiring an employer of an eligible employee to maintain records relating to
the specified matters. Subclause 2(b) provides that the regulations may specify a
penalty not exceeding 50 penalty units, for offences against the regulations. Item 30
makes an amendment consequential to the inclusion of subsection 54(2).
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 1 - Part 2
PART 2 - AMENDMENTS RELATING TO FUNDING
Coal Mining Industry (Long Service Leave Funding) Act 1992
Item 33 - subsection 4(1) - definition of industrial authority repealed
Item 34 - subsection 4(1) - definition of relevant industrial instrument repealed
143.Items 33 and 34 repeal definitions that are no longer relevant to the scheme.
Item 32 - subsection 4(1) - definition of Employer Reimbursement Rules
Item 35 - at the end of subsection 11(1) - payments out of the Fund under clause 44
Item 36 - at the end of section 40 - separate notional accounts within the Fund
Item 37 - subsection 43(1) to (4) - sufficiency of the Fund
Item 38 - subsection 43(5) - obtaining advice from an actuary
Item 39 - subsection 43(6) - reimbursement of employers
Item 40 - sections 44 to 46 - payments to employees if employer insolvent, etc.
144.These items give effect to changed reimbursement arrangements under the amended
scheme. From 1 January 2012 an employer will be reimbursed in accordance with
Employer Reimbursement Rules (the Rules) made by the Board of the Corporation.
Under the current scheme, an employer is reimbursed the full amount of any long
service leave payments made to an eligible employee irrespective of how much levy
has been paid in respect of that employee. The IWP have agreed to change the way
an employer is to be reimbursed so that the amount an employer is reimbursed for a
long service leave payment to an eligible employee will correspond more closely to
the amount of levy that has been paid into the Fund in relation to the employee. It
will not always be the case that an employer is reimbursed the full amount that they
are required to pay the employee under Part 5A. It is intended that, in transitioning
to the new scheme, the Rules will provide for different reimbursement formulae
depending on whether an employee's qualifying service period occurs before or on
or after 1 January 2012.
145.Following the commencement of this Act where an employer makes an application
to the Corporation to be reimbursed levy for a payment under Part 5A the
Corporation must pay the employer out of the Fund an amount decided by the Board
in accordance with the Rules.
146.Item 32 provides that Employer Reimbursement Rules has the meaning given by
clause 45. Clause 45 provides that the Rules are to be made by the Board and are to
be made as a legislative instrument. The Rules should relate to the amount that an
employer is to be reimbursed for a payment by the employer to an employee under
Part 5A; the amount that an employer is to be reimbursed for a payment by the
employer to the legal personal representative of an employee who is deceased; and
the creation of a notional account for each person who is, or was, an eligible
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Explanatory Memorandum - Schedule 1 - Part 2
employee representing his or her share of payments in the Fund on or after 1 January
2012, whether or not the relevant employer actually receives any of that share.
147.Provision is made in subclause 45(2) that the Rules relating to amounts mentioned in
paragraphs 45(1)(a) or (b) may be different on the basis of employment as an
eligible employee before 1 January 2012 and employment as an eligible employee
on or after 1 January 2012.
148.Given that the reimbursable amount will be determined differently for payments
relating to whether the employee's qualifying service period occurs before, or on or
after 1 January 2012, item 36 adds a new subsection 40(6) to make it clear that the
Corporation may create separate notional accounts within the Fund to reflect payroll
levy paid by employers before 1 January 2012 and such levy paid on or after 1
January 2012.
149.A note under subclause 44(2) draws attention to clause 52B which provides that an
application may be made to the AAT for a review of a decision of the Board as to
the amount that is reimbursable to an employer.
150.Item 37 repeals subsection 43(1) to (4) and provides that the Board must seek advice
from an actuary as to whether the rate of payroll levy being imposed at the time is
adequate to ensure that the Fund will be sufficient to reimburse employers in
accordance with the Rules and if it is not what rate would be adequate. The Board is
to seek such advice at least once every 3 years.
Item 41 - sections 48, 48A and 48B - payments to employees if employer insolvent etc.
151.Item 41 repeals sections 48, 48A and 48B as they are no longer relevant to the
scheme and inserts in their place a provision dealing with payments to employees in
the event of their employer's insolvency, etc.
Clause 48 - Payments to employees if employer insolvent etc.
152.In the event that an employer becomes insolvent, is being wound up or ceases to
exist an eligible or former eligible employee may apply in writing to the Corporation
for payment in respect of a period of untaken long service leave under Part 5A of the
Act. The Board will then need to verify that the employer is insolvent, being wound
up or has ceased to exist and if it finds it to be the case the Corporation must pay the
employee in respect of the employee's untaken long service leave the amount that
would have been payable by the employer under Part 5A the amount the employee
would have been payable had they taken the period of long service leave
immediately before the relevant circumstance. Unlike the amount the Corporation
will ordinarily reimburse an employer which will be determined in accordance with
the Rules, the amount will always be the full amount owed by the employer to the
employee under Part 5A.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 1 - Part 2
153.Subclause 48(4) makes it clear that the payment by the Corporation discharges the
liability of the employer to make the payment and extinguishes the employee's
entitlement under Part 5A to the period of untaken long service leave.
154.Subclause 48(5) defines employer to make it clear that it is to be the current
employer of an eligible employee and for a former eligible employee it is the
employer of the employee immediately before the employee ceased to be an eligible
employee.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 1 - Part 3
PART 3 - OTHER AMENDMENTS
Coal Mining Industry (Long Service Leave Funding) Act 1992
Item 42 - title
Item 43 - section 1 - name of act
155.Items 42 and 43 amend the long and short titles of the Funding Act to reflect the
amendments made by this Bill. The Funding Act will be renamed the Coal Mining
Industry (Long Service Leave) Administration Act 1992 (the Administration Act).
Item 44 - section 3
Item 45 - after paragraph 3(a) - object
Item 46 - paragraph 3(b) - payments made in respect of long service leave
156.These items amend the objects of the Funding Act to reflect the broader operation of
the Administration Act.
Item 47 - section 51 - consequential amendment
Item 48 - section 52 - consequential amendment
Item 49 - section 53 - repeal section 53
157.Item 49 repeals section 53, which is an old transitional provision that no longer has
effect. Items 47 and 48 make consequential amendments to sections 51 and 52.
Coal Mining Industry (Long Service Leave) Payroll Levy Act 1992
Item 50 - subsection 8(2) - insert new title of Administration Act
158.This item makes a consequential amendment to the Payroll Levy Act as a result of
renaming the Funding Act the Administration Act (item 43).
Coal Mining Industry (Long Service Leave) Payroll Levy Collection Act 1992
Item 51 - section 3 - definition of Administration Act
Item 52 - section 3 (definition of Corporation) - consequential amendment
Item 53 - section 3 (definition of eligible employee) - consequential amendment
Item 54 - section 3 (definition of Fund) - consequential amendment
Item 55 - section 3 (definition of Funding Act) - repeal
159.These items make consequential amendments to the Payroll Levy Collection Act as
a result of renaming the Funding Act the Administration Act (item 43).
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Explanatory Memorandum - Schedule 2
SCHEDULE 2 - CONSTITUTION OF THE BOARD
Overview
160.Schedule 2 provides for changes in the constitution and operation of the Board to
better reflect the current industry representative status of certain employee-
representative and employer-representative groups, and to increase the terms of
directors from 2 years to 4 years. It also makes a variety of technical and
consequential amendments.
Coal Mining Industry (Long Service Leave Funding) Act 1992
Item 1 - subsection 4(1) - consequential amendments
Item 2 - subsection 4(1) - consequential amendments
161.Items 1 and 2 make consequential changes to subsection 4(1) to reflect the
amendments in Items 3 and 4.
Item 3 - subsection 13(2) - appointment of directors to represent New South Wales,
Queensland, Tasmania
162.Currently, 2 directors are to be appointed to represent the companies engaged in
black coal mining in New South Wales, Queensland or Tasmania.
163.Item 3 changes this requirement to 1 director to represent companies in New South
Wales or Tasmania and another to represent companies in Queensland. This reflects
the contemporary industry status of companies engaged in black coal mining in these
states.
Item 4 - subsection 13(4) - appointment of directors to represent the CFMEU
164.Currently, one director is to be appointed to represent the United Mine Workers
Division of the CFMEU. Item 4 makes provision to have two directors appointed in
this role.
165.This reflects the contemporary role of the CFMEU in the black coal mining industry.
Item 4 will also replace the reference to the `United Mine Workers Division of the
Construction, Forestry, Mining and Employees Union' with a reference to the
`Mining and Energy Division of the Construction, Forestry, Mining and Energy
Union' which reflects the contemporary structure and name of the CFMEU.
Item 5 - subsections 13(5) and (6) - appointment of directors to represent employee and
employer associations
166.Currently, one director is to be appointed to represent the Electrical Trades Union of
Australia; the Federated Engine Drivers' and Fireman's Association of Australia;
and the Metals and Engineering Workers' Union. Another director is currently to be
appointed to represent the Australian Collieries Staff Association; the Colliery
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 2
Officials Association of New South Wales; and the New South Wales Mine
Managers Association.
167.Item 5 makes provision for one director to be appointed to represent the
Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and
Allied Services Union of Australia; the Automotive, Food, Metals, Engineering,
Printing and Kindred Industries Union; the Association of Professional Engineers,
Scientists and Managers Australia; the Colliery Officials Association of New South
Wales; and the Mine Managers Association of Australia. This reflects the
contemporary names and industry representative status of these bodies.
Item 6 - subsection 13(7) - Mining and Energy Division of the Construction, Forestry,
Mining and Energy Union
168.Item 6 replaces the reference to the `United Mine Workers Division of the
Construction, Forestry, Mining and Employees Union' with a reference to the
`Mining and Energy Division of the Construction, Forestry, Mining and Energy
Union' which reflects the contemporary structure and name of the CFMEU.
Item 7 - subsection 13(8) - consequential amendments
Item 8 - subsection 13(9) - consequential amendments
169.Items 7 and 8 make consequential amendments to subsections 13(8) and (9) to
reflect the amendments in items 3 and 5.
Item 9 - subsection 14(4) - consequential amendments
Item 10 - paragraph 14(5)(b) - consequential amendments
170.Item 9 allows a Director to be appointed Chairperson or Deputy Chairperson for up
to 4 years (currently 2 years). Item 10 provides that the offices of the Chairperson
and Deputy Chairperson to be rotated every 4 years (currently 2 years) between the
two categories of Directors (the two categories being employee-representative
Directors and employer-representative Directors).
Item 11 - subsection 17(2) - technical amendment
171.Item 11 replaces the reference to `clause 22' (which has previously been repealed)
with a reference to `clause 27J of the Commonwealth Authorities and Companies Act
1997'. Clause 27J of the Commonwealth Authorities and Companies Act 1997 deals
with restrictions on voting.
Item 12 - paragraph 18(a) - technical amendment
172.Item 12 substitutes `directors' with `Directors' wherever occurring.
Item 13 - section 23 - term of appointment of Directors
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 2
173.Item 13 provides that a Director is to be appointed for a period not exceeding 4 years
(currently 2 years).
Item 14 - application of amendments
174. Item 14 provides that the amendments made by Items 3, 4, 5, 9, 10 and 13 apply in
relation to appointments or reappointments of Directors, the Chairperson or Deputy
Chairperson on or after 1 January 2012. The persons who currently hold these
appointments are not affected by these amendments but their successor(s) will be.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 3 - Part 1
SCHEDULE 3 - LEVY AND COLLECTION ARRANGEMENTS
Overview
175.Part 1 of Schedule 3 contains the definitions of base rate of pay and eligible wages,
which form the basis on which payroll levy is payable and an employee's long
service leave entitlements are paid. These amendments are a result of an IWP
proposal that is intended to ensure that the amount of levy paid into the Fund in
relation to an employee more closely corresponds with the amount reimbursed to an
employer for the payment of an employee's long service leave entitlement.
176.Part 2 of Schedule 3 contains amendments relating to the requirement of employers
to pay levy, submit returns and provide an annual report to the Corporation.
177.It also amends the penalty amounts of civil penalty provisions so that they are
expressed in penalty units rather than dollar values.
PART 1 - AMENDMENTS RELATING TO LEVY
Coal Mining Industry (Long Service Leave) Payroll Levy Collection Act 1992
Item 1 - section 3 - definition of base rate of pay
178. Item 1 provides that base rate of pay has the same meaning as in the FW Act. An
employee's base rate of pay will be relevant to the calculation of an employee's
eligible wages (clause 3B).
Item 2 - section 3 - definition of eligible wages
179.Item 2 repeals the existing definition of eligible wages and inserts an amended
definition. It provides that eligible wages has the meaning given by clause 3B.
Item 3 - section 3 - definition of salary sacrifice arrangement
180.Item 3 provides the definition of salary sacrifice arrangement in section 3. A salary
sacrifice arrangement is an arrangement under which an employee chooses to forgo
a percentage or amount payable to the employee in relation to the performance of
work but receives some other form of benefit or remuneration.
Item 4 - after section 3A - meaning of eligible wages
181.Clause 3B gives the revised meaning of eligible wages. What constitutes an
employee's eligible wages is determined by the type of employee and the basis on
which they are paid.
182.Where the eligible employee is a paid a base rate of pay and is not a casual
employee, their eligible wages are the greater of:
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 3 - Part 1
· the base rate of pay paid to the employee, including incentive-based payments
and bonuses; or
· 75% of the base rate of pay paid to the employee, including:
o incentive-based payments and bonuses; and
o overtime or penalty rates; and
o allowances (other than those for reimbursement of expenses).
183.Where the eligible employee is paid an annual salary, the eligible wages are the
annual salary paid to the employee, including incentive-based payments and bonuses
but excluding:
· overtime or penalty rates; and
· shift-loadings.
184.Where the eligible employee is a casual employee, the eligible wages are the base
rate of pay paid to the employee including incentive-based payments and bonuses.
185.A casual employee's base rate of pay is determined by what the casual employee is
actually paid as a base rate of pay.
186.Base rate of pay is the base rate of pay before any amounts deducted under a salary
sacrifice arrangement and a reference to the annual salary is a reference to the annual
salary before any amounts are deducted under a salary sacrifice arrangement.
187.An incentive-based payment is a payment that is paid to the employee at least once a
month and a bonus is a bonus that is paid to the employee at least once a month.
Item 5 - application of Item 4
188.This item provides that the amendment made by item 4 of this Schedule applies in
relation to levy payable in respect of employment on or after 1 January 2012.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 3 - Part 2
PART 2 - AMENDMENTS RELATING TO AUDIT AND REPORTING
REQUIREMENTS ETC.
Coal Mining Industry (Long Service Leave) Payroll Levy Collection Act 1992
Item 6 - section 3 - definition of employer
189.This item provides that `employer' has the same meaning as in the Administration
Act.
Item 7 - section 3A - consequential amendment
Item 8 - at the end of section 3A - physical elements for certain offences
190.Item 8 inserts a new subsection 3A(2) that contains a table outlining the physical
elements for certain offences. Item 7 is a consequential amendment.
Item 9 - section 4 - due date for payment
191. Item 9 substitutes a new section 4 which provides that levy is payable at the same
time that a return is required by the Levy Collection Act - that is, 28 days after the
end of a month in which a person employs an eligible employee (see item 10).
192.The amendment made by this item applies in relation to levy payable in respect of
employment on or after 1 January 2012 (see item 21).
Item 10 - subsections 5(1) and (1A)
Item 11 - subsection 5(3) - returns by employers and offence of strict liability
193. Items 10 and 11 clarify the existing offence relating to employers' returns.
194.Item 10 substitutes a new subsection 5(1) which requires a person who employs an
eligible employee at any time during a month to make a return within 28 days after
the end of that month, in accordance with subclause 5(2).
195.Item 11 substitutes a new subsection 5(3) which makes it an offence of strict liability
for a person to contravene the requirement in subsection 5(1) to make a return. The
penalty is 30 penalty units. The notes point the reader to clause 6.1 of the Criminal
Code for offences of strict liability and to subsection 3A(2) of this Act for the
physical elements of this offence.
196. The amendments made by items 10 and 11 apply in relation to returns made in
respect of employment on or after 1 January 2012 (see item 22).
Item 12 - subsection 9(2) - consequential amendment
Item 13 - subsections 9(3) and 9(4) - annual report of Corporation
197.Item 13 repeals the existing subsections 9(3) and (4). The Board is no longer
required to give notice to the Minister before proceedings are brought to recover
32
Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 3 - Part 2
unpaid levy. The Minister no longer has the option to make directions as to how
amounts paid as a result of recovery of levy or additional levy are dealt with. Item
13 inserts a new subsection 9(3) which details information about recovery of levies
that must be contained in the annual report of the Corporation. The annual report of
the Corporation for a financial year must include the particulars of any amounts paid
to, or recovered by, the Corporation or another person under the recovery of levy or
additional levy provisions during the financial year.
198.The note to subsection 9(3) points the reader's attention to section 9 of the
Commonwealth Authorities and Companies Act 1997, which imposes annual
reporting requirements.
199. The amendment made by item 13 applies to the financial year that started on 1 July
2011 and to later financial years (see item 23).
Item 14 - section 10 - reporting requirements about payment of levies
200. Item 14 repeals section 10 and substitutes new sections 10, 10A and 10B which
strengthen the audit reporting requirements of the scheme.
201.New section 10 now requires any person who employs an eligible employee at any
time during a financial year to provide the Corporation a report prepared by an
auditor no later than 6 months after the end of that financial year. This clarifies that
all employers of eligible employees are required to provide an auditor's report, not
just those employers who are required by the Corporations Act 2001 to appoint an
auditor.
202.New section 10 also requires the employer to provide the Corporation with an
auditor's report, rather than an auditor's certificate as is currently required. The
auditor's report requires the auditor to do more than merely certify that the
information provided by the employer is correct. The auditor's report should
contain the auditor's opinion whether the person has paid all amounts of levy or
amounts of additional levy that the person was required to pay; and if the person has
not - in what respect and to what extent the person has not paid those amounts; and
if the person was paid an amount under Part 7 of the Administration Act (dealing
with payments out of the Fund) - whether the amount paid is correct. Notably,
paragraph 10(1)(d) requires the auditor to provide reasons for the opinions contained
in the report.
203.New section 10A allows the Corporation to require, by written notice, the auditor of
a person who employs an eligible employee at any time during a particular period to
give a report. The auditor's report should contain the auditor's opinion on whether
the person has paid all amounts of levy or amounts of additional levy that the person
was required to pay; and if the person has not - in what respect and to what extent
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 3 - Part 2
the person has not paid those amounts; and if the person was paid an amount under
Part 7 of the Administration Act (dealing with payments out of the Fund) - whether
the amount paid is correct.
204.The Corporation can specify a time in the notice by which the auditor must provide
the report to the Corporation, but that time must be at least 28 days after the notice is
given to the auditor.
205.Notably, paragraph 10A(1)(d) requires the auditor to provide reasons for the
opinions contained in the report.
206.As is currently the case under section 10, failure to comply with these enhanced
audit reporting requirements are offences of strict liability. However, the penalties
have been increased from $1000 to 30 penalty units. Audit reports are the principal
source of information for the Corporation to ensure levies payable by employers are
in fact being paid. Failure by some employers to pay levies would impact on the
Corporation's ability to reimburse long service leave payments made by employers
and would, over time, result in an increase in the rate of the payroll levy applied to
employers. These measures are aimed in part at ensuring that an equitable share of
the cost of long service leave is borne by employers of eligible employees.
207.New sections 10 and 10A apply to the financial year that started on 1 July 2011 and
to later financial years (see items 24 and 25 respectively).
208.New subsection 10B(1) replaces the existing subsection 10(4) and provides that the
employer is liable to pay an auditor such fees as the auditor reasonably charges for
preparing a report in respect of the person for the purposes of clause 10 or 10A.
209.New subsection 10B(2) provides that if a person's auditor gives a report under
subsection 10A(1) and the report states that, in the opinion of the auditor, the person
has paid all amounts of levy or additional levy that the person was required to pay in
respect of the period, the Fund will reimburse to the person the amount they paid to
the auditor under subsection 10B(1).
Item 15 - subsection 12(4) - penalty
Item 16 - subsection 13(8) - penalty
Item 17 - subsection 13(8B) - no defence of reasonable excuse for failure to comply with
notice
Item 18 - 14(3) - penalty
210.Items 15, 16 and 18 update the penalty provisions to accord with the current drafting
style to provide for the penalties in penalty units. Item 17 removes the defence of
reasonable excuse for failure to comply with a notice.
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Explanatory Memorandum - Schedule 3 - Part 2
Item 19 - after paragraph 15(e) - requirement for employer to appoint an auditor
211.Item 19 inserts paragraph 15(ea) to allow the Governor-General to make regulations
requiring employers to appoint an auditor.
Item 20 - paragraph 15(f) - maximum fine able to be prescribed by regulations
212.The maximum fine able to be prescribed by regulations under paragraph 15(f) for
offences against the regulations will be 50 penalty units instead of $1000.
Item 21 - application of item 9
213. Item 21 provides that section 4 of the Payroll Levy Collection Act, as substituted by
item 9 of this Schedule, applies in relation to levy payable in respect of employment
on or after 1 January 2012.
Item 22 - application of items 10 and 11
214.Item 22 provides that the amendments made by items 10 and 11 of this Schedule
apply in relation to returns made in respect of employment on or after 1 January
2012.
Item 23 - application of item 13
215.Item 23 provides that the amendment made by item 13 of this Schedule applies to
the financial year that started on 1 July 2011 and to later financial years.
Item 24 - application of clause 10 of the Payroll Levy Collection Act
216.Item 24 provides that section 10 of the Payroll Levy Collection Act as inserted by
item 14 of this Schedule, applies to the financial year that started on 1 July 2011 and
to later financial years.
Item 25 - application of clause 10A of the Payroll Levy Collection Act
217.Item 25 provides that section 10A of the Payroll Levy Collection Act as inserted by
item 14 of this Schedule, applies to the financial year that started on 1 July 2011 and
to later financial years.
Item 26 - application of items 15 to 18
218. Item 26 provides that the amendments made by items 15 to 18 of this Schedule
apply in relation to acts and omissions that occur on or after 1 January 2012. If an
act or omission is alleged to have occurred between 2 dates, one before and one on
or after 1 January 2012, the act or omission is taken to have occurred before 1
January 2012.
35
Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 4
SCHEDULE 4 - AMENDMENT OF THE COAL MINING INDUSTRY
(LONG SERVICE LEAVE FUNDING) AMENDMENT ACT 2009
Overview
219.This Schedule makes a small technical amendment to Schedule 2 of the 2009
Amendment Act.
220.Schedule 2 of the 2009 Amendment Act extended long service leave entitlements to
all eligible employees in the black coal mining industry who did not have an award-
derived long service leave entitlement at that time (non-award employees), with
effect from 1 January 2010. This provision was intended to operate prospectively,
that is, only service after 1 January 2010 would be qualifying service for the
purposes of calculating the long service leave entitlements of non-award employees.
Although intended to operate prospectively, it may be arguable that the provision as
drafted could allow service before 1 January 2010 to be taken into account in
calculating the post-1 January 2010 long service leave entitlements of non-award
employees. This was not the intention of the IWP when they agreed to extend long
service leave entitlements to non-award employees.
221.As part of the transitional arrangements to move eligible employees from the award-
derived long service entitlement (preserved under section 113 of the FW Act in
respect of award employees and extended to non-award employees by Schedule 2 of
the 2009 Amendment Act) to the new statutory entitlement established by this Bill,
the IWP has agreed that all eligible employees in the black coal mining industry,
including non-award employees, would have their qualifying service from 1 January
2000 assessed under the new rules.
222.The combined effect of this amendment to Schedule 2 of the 2009 Amendment Act,
together with the transitional provisions in Schedule 5 of the Bill, ensure that long
service leave entitlements of non-award employees in the black coal mining industry
will be calculated on the basis of accrued service dating back to 1 January 2000.
Item 1 - Subitem 1(4) of Schedule 2 - definition of employment as an eligible employee
223.Item 1 amends subitem 1(4) of Schedule 2 of the 2009 Amendment Act to insert a
definition of employment as an eligible employee to clarify that service completed
by a non-award employee between 1 January 2000 and the commencement of the
Bill will be service for calculating eligibility for long service leave. This item takes
effect from 1 January 2010, the date on which non-award employees in the black
coal mining industry became eligible for long service leave.
Item 2 - Schedule 2 - repeal
224.Item 2 repeals Schedule 2 of the 2009 Amendment Act on commencement of the
main provisions of the Bill, that is, on 1 January 2012. As the Bill establishes a
36
Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 4
statutory entitlement to long service leave for all eligible employees in the black coal
mining industry on the same basis as the award existing in 2009 and for non-award
employees for service accruing from 1 January 2000, this Schedule is spent.
37
Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 5 - Parts 1 and 2
SCHEDULE 5 - TRANSITIONAL PROVISIONS
Overview
225.Schedule 5 establishes a regime for transition from the award-derived long service
leave scheme (preserved under section 113 of the FW Act in respect of award
employees and extended to non-award employees by Schedule 2 of the 2009
Amendment Act) to the new statutory long service leave scheme established by this
Bill. In effect, the transitional regime applies the new aggregate service rules to all
qualifying service completed by eligible employees and former eligible employees
between 1 January 2000 and 31 December 2011.
226.The Corporation is required to calculate the periods of service of all employees since
1 January 2000 and the entitlement to long service leave for each employee whose
period of service totals at least 8 years and qualifies the employee for long service
leave.
227.The Corporation will keep a record of all service for eligible employees in the
industry and an associated record of income from levy payments generally
attributable to each employee. This record will be the basis for determining payment
to the employer in accordance with Employer Reimbursement Rules which the
Corporation will make. .
PART 1 - PRELIMINARY
Item 1 - Interpretation
228.Item 1 defines terms relevant to the transitional provisions.
PART 2 - RECOGNITION OF LONG SERVICE LEAVE BEFORE 1 JANUARY 2012
Item 2 - Recognition of long service leave - eligible employees
229.Item 2 requires the Corporation to calculate the periods of qualifying service during
the 12 years before the commencement of the new law for all employees that are
eligible employees on or after 1 January 2012. The Corporation will have the names
of all current eligible employees through the payroll levy collection process. Where
an eligible employee's service totals at least 8 years, the Corporation will also
calculate that employee's entitlement to long service under Part 5A.
Item 3 - Recognition of long service leave - former eligible employees
230.Item 3 enables former eligible employees to apply to the Corporation to have any
periods of qualifying service during the 12 years before the commencement of the
new law recognised as qualifying service. An application must be made on or
before 30 September 2012 (unless a later date is prescribed by the regulations) and
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 5 - Parts 2 and 3
must include the required information - periods of employment as an eligible
employee, whether the employment was full-time, part-time or casual, and the
employer for each period. The Corporation must verify that information and, if the
information is correct, calculate the employee's entitlement to long service leave. If
the information is not correct the Corporation must take steps to resolve what
periods of service and what entitlement falls within the new law.
Item 4 - Recognition of long service leave before 1 January 2000
231.Item 4 clarifies that the entitlement of award employees to long service leave arising
from service before 1 January 2000 is not affected by items 2 and 3. However, any
service before 1 January 2000 will be assessed in accordance with the old rules (i.e.,
any applicable award-derived long service leave terms as preserved by section 113
of the FW Act) rather than in accordance with the new rules.
232.Non-award employees who did not have any entitlement to long service leave before
the enactment of the 2009 Amendment Act will not have any service before 1
January 2000 recognised for long service leave purposes.
Item 5 - Certain service not recognised
233.This item prevents `double-dipping' in calculating an employee's qualifying service
under the transitional provisions. Service is not recognised for the purposes of
accruing a long service leave entitlement where an employee had expressly
bargained away that entitlement as part of negotiations under an Australian
workplace agreement or where the employee had already taken long service leave
before 1 January 2012, whether under the industry scheme or a State law.
PART 3 - KEEPING RECORDS OF RECOGNISED LONG SERVICE LEAVE
Item 6 - Records relating to eligible employees
234.Item 6 requires the Corporation to notify each eligible employee, on or before 30
September 2012 (or a later date prescribed by the regulations), of the contents of its
records in so far as they relate to that employee, including the employee's
employment as an eligible employee, his or her employer/s and completed
qualifying service with the leave entitlement for that service calculated under item 2.
Item 6 also allows an employee to seek to correct the Corporation's record if he or
she considers that any of the information is incorrect or incomplete. The
Corporation is also required to provide the employee's current employer(s) with the
same information.
Item 7 - Records relating to former eligible employees
235.Item 7 requires the Corporation to notify each former eligible employee who has
made an application under item 3, on or before 31 December 2012 (or a later date
39
Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 5 - Parts 3 and 4
prescribed by the regulations) of the contents of its records in so far as they relate to
that employee, including the employee's employment as an eligible employee and
the employer/s of that employee as well as the calculation made under item 3.
Item 8 - Interaction with the new law
236.Item 8 provides for the interaction of the calculation made by the Corporation during
the transitional period with the ongoing operation of the new law established by the
Bill. This means that the calculations of periods of service since 1 January 2000 that
qualify for long service leave and, if eligible (by qualifying service adding up to 8
years) the amount of accrued leave during the transitional period will entitle the
employee to long service leave as part of the new law.
237.Once the transitional period has ceased an employee will accrue long service leave
entitlements under the new law but will no longer be eligible to have the service
assessed between 1 January 2000 and 31 December 2011 as eligible service under
the new law.
238.Item 8 also provides that the qualifying service assessed under the transitional
provisions will be added to the leave entitlement that is accrued under the new law
(under paragraph 39AB(5)(a).
239.As set out above, item 4 clarifies that no employee who had an award-derived long
service entitlement dating back before 1 January 2000 will be adversely affected, as
that entitlement will continue to be assessed and employers will continue to be
reimbursed for long service leave payments under the old law.
240.As part of the new law, disputes between an employer and an employee about the
employee's entitlements will fall within the jurisdiction of FWA under clause 39D in
Part 1 of Schedule 1.
Item 9 - Records created after 1 January 2012
241.Item 9 clarifies that a person who is not an eligible employee in the black coal
mining industry on 1 January 2012 will only have the benefit of the transitional rules
if he or she makes an application within the period specified in item 3. If no
application is made during the transitional period, that employee's long service leave
entitlements will be calculated in accordance with the old rules (i.e., any applicable
award-derived long service leave terms as preserved by section 113 of the FW Act)
rather than in accordance with the new rules.
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Coal Mining Industry (Long Service Leave) Legislation Amendment Bill 2011
Explanatory Memorandum - Schedule 5 - Parts 3 and 4
PART 4 - MISCELLANEOUS
Item 10 - Actuarial advice relating to sufficiency of fund
242.Item 10 requires the Board of the Corporation to obtain advice from an actuary
whether the payroll levy is adequate to meet the reimbursement of employers under
the Employer Reimbursement Rules and if not the rate of levy that would be
adequate.
Item 11 - Transitional regulations
243.Item 11 allows for the making of regulations to give effect to the transitional
provisions. The making of these regulations will facilitate the smooth transition
from the old scheme to the new scheme, in particular the administrative
arrangements for the calculation of the new entitlements of current and former
eligible employees. The regulations will also allow for matters of a transitional
nature to assist with the smooth transition to the new law in the new Part 5A relating
to entitlement to long service leave and Part 7 relating to the amounts that are or may
become payable to employers.
41