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2019
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
SENATE
FAIR WORK (REGISTERED ORGANISATIONS) AMENDMENT
(ENSURING INTEGRITY) BILL 2019
SUPPLEMENTARY EXPLANATORY MEMORANDUM
Amendments to be moved on behalf of the Government
(Circulated by authority of the Attorney General and Minister for Industrial Relations, the
Hon Christian Porter MP)
Outline
AMENDMENTS TO THE FAIR WORK (REGISTERED ORGANISATIONS)
AMENDMENT (ENSURING INTEGRITY) BILL 2019
OUTLINE
The Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2019 (the
Bill) amends the Fair Work (Registered Organisations) Act 2009 (the Act) to respond to
community concern and the recommendations of the Final Report of the Royal Commission
into Trade Union Governance and Corruption (the Royal Commission) to ensure the integrity
of registered organisations and their officials, for the benefit of their members.
The Bill responds to Royal Commission recommendations 36, 37 and 38, and the
Government's commitment to fairness, integrity and transparency of registered organisations
and their officials.
The Government proposes to move amendments to the Bill that would:
limit standing to apply to the Federal Court (the Court) for an order seeking
disqualification of an individual from holding office or cancellation of registration of
or the making of an alternative order against an organisation to the Registered
Organisations Commissioner (the Commissioner), and allow for a person, who
reasonably believes a ground applies, to refer a matter to the Commissioner;
provide that the sum of the maximum penalties for designated finding must be above a
certain threshold within a certain timeframe, before certain grounds for
disqualification can apply;
clarify that it is the Commissioner who must satisfy the Court that disqualification,
cancellation of registration or the making of alternative orders would not be unjust
(including by reference to the gravity of the matters constituting the ground), before
the Court can make an order;
clarify that the Court may (but is not required) to make disqualification, cancellation
or alternative orders when satisfied of the relevant statutory criteria;
remove as a ground for cancellation of registration and alternative orders, where
affairs of the organisation or part are being conducted in an oppressive, unfairly
prejudicial or unfairly discriminatory manner against a member or class of members;
remove an offence under a law of another country punishable on conviction by
imprisonment for life or a period of 5 years or more as a prescribed offence for the
purposes of the automatic disqualification regime;
allow the Fair Work Commission (FWC) to decide as a threshold matter, whether a
proposed amalgamation should be subject to the public interest test, based on the
compliance history of the relevant organisations;
provide that in carrying out his or her function of promoting efficient management of
organisations and high standards of accountability of organisations, the Commissioner
must prioritise matters that raise serious or systemic concerns; and
Senate page iii Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Outline
make consequential amendments.
FINANCIAL IMPACT STATEMENT
Nil
Senate page iv Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Statement of Compatibility with Human Rights
STATEMENT OF COMPATIBILITY WITH HUMAN RIGHTS
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Amendments to the Fair Work (Registered Organisations) Amendment (Ensuring
Integrity) Bill 2019
The amendments to the Fair Work (Registered Organisations) Amendment (Ensuring
Integrity) Bill 2019 (the Bill) are compatible with the human rights and freedoms recognised
or declared in the international instruments listed in section 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011.
Overview of amendments to the Bill
The Bill amends the Fair Work (Registered Organisations) Act 2009 (the Act) to respond to
community concern and recommendations 36, 37 and 38 of the Final Report of the Royal
Commission into Trade Union Governance and Corruption (the Royal Commission) to ensure
the integrity of registered organisations and their officials, for the benefit of their members.
The amendments to the Bill on sheet RC114 would:
limit standing to apply to the Federal Court (the Court) for an order seeking
disqualification of an individual from holding office or cancellation of registration of
or the making of an alternative order against an organisation to the Registered
Organisations Commissioner (the Commissioner), and allow for a person, who
reasonably believes a ground applies, to refer a matter to the Commissioner;
provide that the sum of the maximum penalties for designated findings must be above
a certain threshold within a certain timeframe, before certain grounds for
disqualification can apply;
clarify that it is the Commissioner who must satisfy the Court that disqualification,
cancellation of registration or the making of alternative orders would not be unjust
(including by reference to the gravity of the matters constituting the ground), before
the Court can make an order;
clarify that the Court may (but is not required) to make disqualification, cancellation
or alternative orders when satisfied of the relevant statutory criteria;
remove as a ground for cancellation of registration and alternative orders, where
affairs of the organisation or part are being conducted in an oppressive, unfairly
prejudicial or unfairly discriminatory manner against a member or class of members;
remove an offence under a law of another country punishable on conviction by
imprisonment for life or a period of 5 years or more as a prescribed offence for the
purposes of the automatic disqualification regime;
allow the Fair Work Commission (FWC) to decide as a threshold matter, whether a
proposed amalgamation should be subject to the public interest test, based on the
compliance history of the relevant organisations;
Senate page v Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Statement of Compatibility with Human Rights
provide that in carrying out his or her function of promoting efficient management of
organisations and high standards of accountability of organisations, the Commissioner
must prioritise matters that raise serious or systemic concerns; and
make related consequential amendments.
Human rights implications
The amendments positively engage with the human rights implications of the Bill as
expressed in the Statement of Compatibility with Human Rights that accompanies the
Explanatory Memorandum for this Bill.
The amendments are compatible with:
Article 22 of the International Covenant on Civil and Political Rights (ICCPR) and
Articles 6 and 8(1)(a) of the International Covenant on Economic, Social and
Cultural Rights (ICESCR) including:
o the right to freedom of association;
o the right to form and join trade unions; and
o the right of trade unions to function freely.
The content of the rights to work and rights in work in the ICESCR can be
informed by treaties of the International Labour Organisation (ILO), including the
Freedom of Association and Protection of the Right to Organise Convention 1948
(No. 87) (ILO Convention 87), which provides employer and employee
organisations with protection for their organisational autonomy.
The right to the presumption of innocence and the minimum guarantees contained
in Article 14 of the ICCPR.
1. Amendments to disqualification and cancellation standing provisions
The Commissioner is now the only person who has standing to apply to the Court for an order
disqualifying someone from holding office under Schedule 1, or for an order cancelling an
organisation's registration or the making of an alternative order under Schedule 2.
While the amendments allow another person who reasonably believes that a relevant ground
applies to refer matters in writing to the Commissioner, the Commissioner may, but is not
required to, take action in relation to that referral.
Limiting standing to the Commissioner enhances compatibility with human rights obligations
by providing that it is only the regulator of registered organisations alone, who has standing to
apply for disqualification and cancellation/alternative orders.
2. Amendments to the grounds for disqualification and cancellation
The amendments to the grounds for disqualification in Schedule 1 and cancellation/the
making of alternative orders in Schedule 2 of the Bill raise the threshold before a relevant
ground can apply.
Senate page vi Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Statement of Compatibility with Human Rights
For a relevant ground for disqualification to be made out in relation to designated findings,
there must now be a contravention of one or more civil penalty provisions with combined
maximum penalties of 180 penalty units within the last 10 years. The ground for multiple
failures to prevent contraventions etc. by an organisation has also been amended so that for
civil contravention breaches alone, there must be at least two civil findings against the
organisation with a combined total of the maximum penalties of at least 900 penalty units
within the last 10 years. These amendments enhance compatibility with human rights
obligations and address stakeholder concerns that minor or technical contraventions could be
grounds for a disqualification application.
The grounds for cancellation orders and alternative orders have also been amended to remove
the ground where the affairs of an organisation are being conducted in a way that is
'oppressive or unfairly prejudicial to, or unfairly discriminatory against, a member or a class
of members'. This amendment enhances compatibility with human rights and addresses
stakeholder concerns that in registered organisations, particularly in the context of collective
bargaining where groups of members can have competing interests, the ground could be made
out where there is a perception that one group of members has been treated less favourably
than another group.
3. Amendments to the automatic disqualification regime
A conviction of an offence under a law of 'another country' punishable by imprisonment for
life or five years or more is no longer a prescribed offence that results in automatic
disqualification. This amendment enhances compatibility with human rights obligations
because the ground for automatic disqualification can under proposed section 212(aa) of the
Bill can now only be engaged by contraventions of laws passed by parliaments of Australia.
4. Amendments to the application of the public interest test
The amendments to the amalgamation provisions in Schedule 4 of the Bill will require a Full
Bench of the FWC to consider as a preliminary matter, whether a proposed amalgamation
should be subject to the public interest test in the Bill. The FWC may only decide that the
public interest test in the Bill is to apply to a proposed amalgamation if there is information
before the FWC that at least 20 compliance record events have occurred for at least one of the
existing organisations concerned in the amalgamation, within the 10 years prior to an
application for approval for submission of an amalgamation ballot under section 44 of the
Act. The FWC will be required to publish written reasons in relation to this preliminary
threshold matter.
This amendment enhances compatibility with human rights obligations by ensuring that law-
abiding organisations can amalgamate without additional oversight.
5. Burden of proof
The amendments to new sections 222, 28J and 28L of the Bill confirm and clarify that it is the
applicant Commissioner who must satisfy the Court that the making of a disqualification
order, cancellation order or alternative order would not be unjust.
This amendment enhances compatibility with human rights obligations, and in particular the
right to presumption of innocence, by making it clear that it is the Commissioner at all times
who bears the legal onus of proof in the Bill.
Senate page vii Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Statement of Compatibility with Human Rights
Conclusion
The amendments to the Bill are compatible with human rights.
Senate page viii Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
NOTES ON AMENDMENTS
In these notes on amendments, the following abbreviations are used:
Act Fair Work (Registered Organisations) Act 2009
Bill Fair Work (Registered Organisations) Amendment (Ensuring Integrity)
Bill 2019
Corporations Act Corporations Act 2001
Crimes Act Crimes Act 1914
Court Federal Court
FW Act Fair Work Act 2009
FWC Fair Work Commission
Commissioner Registered Organisations Commissioner
Prescribed offences
Amendment 1 - Schedule 1, item 8, page 5 (line 23)
1. This amendment removes from new subsection 212(aa) an offence under a law of
another country punishable on conviction by imprisonment for life or a period of 5 years or
more. This means that only offences against a law of the Commonwealth, a State or Territory
with the appropriate term of imprisonment will amount to a prescribed offence for the
purposes of the existing automatic disqualification regime in the Act.
Standing
Amendment 2 - Schedule 1, item 11, page 6 (lines 10 and 11)
2. This amendment removes references to the Minister, or a person with a sufficient
interest in the Simplified outline of the Division. This is a consequential amendment to
Amendment 3.
Amendment 3 - Schedule 1, item 11, page 6 (lines 15 to 20)
3. This amendment amends the discretionary disqualification regime inserted by the Bill
to provide that only the Commissioner has standing to apply to the Court for an order
disqualifying a person from holding office in an organisation or a branch of an organisation if
the Commissioner considers one or more of the grounds set out in section 223 applies.
4. The note directs the reader to new section 223A which provides that a person who
reasonably believes that a ground set out in section 223 applies, may refer the matter to the
Commissioner. The note also makes it clear that the Commissioner does not need a referral to
make an application for a disqualification order under section 222.
Senate page 1 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
Amendment 8 - Schedule 1, item 11, page 7 (line 4)
5. This amendment is consequential to the Commissioner now being the only person who
can make an application for a disqualification order under section 222. It removes the
requirement for the Court to provide the Commissioner with a copy of the disqualification
order as the Commissioner will now always be the applicant in the proceedings.
Amendment 14 - Schedule 1, item 11, page 9 (after line 5), at the end of Division 3
6. This amendment inserts new section 223A into the Bill, providing for a person (the
referrer) who reasonably believes that a ground for disqualification set out in section 223
exists in relation to another person, to refer the matter to the Commissioner.
7. The referral must be in writing, identify and provide contact details for the referrer,
and set out the basis for the reasonable belief that a ground exists.
8. The amendment provides that the Commissioner may, but is not required to, take
action in relation to the referral.
9. The note highlights that the Commissioner may apply for a disqualification order
under section 222 in relation to referrals made under section 223A if he or she considers a
ground set out in section 223 applies in relation to a person.
10. The referral mechanism provided for in this amendment does not limit the ability of a
person to raise with the Commissioner any matter of concern for the Commissioner's
consideration.
Amendment 15 - Schedule 1, item 14, page 11 (lines 11 and 12)
11. This amendment removes references to the Minister, or a person with a sufficient
interest from the note under subsection 308(1) of the Act. In the context of the existing
disqualification power in section 307A of the Act, section 308 provides that the Court may
make such orders as the Court considers appropriate in all the circumstances of the case where
a person has contravened a civil penalty provision of the Act.
12. The note to subsection 308(1) draws the reader's attention to the fact that the
Commissioner may also apply under new section 222 for an order disqualifying a person from
holding office in an organisation. This is a consequential amendment to Amendment 3.
Amendment 19 - Schedule 2, item 4, page 15 (line 7)
Amendment 20 - Schedule 2, item 4, page 15 (line 8)
13. These amendments remove references to the Minister, or a person with a sufficient
interest in the Simplified outline of the Division. They are consequential amendments to the
simplified outline of the part as a result of Amendment 22.
Amendment 22 - Schedule 2, item 4, page 15 (line 23) to page 16 (line 14)
14. This amendment omits sections 28, 28A and 28B of the Bill and inserts new sections
28, 28A and 28B to provide that it is now only the Commissioner who has standing to apply
to the Court for a cancellation or alternative order (or both).
Senate page 2 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
15. Legislative notes to new sections 28 and 28A direct the reader to new section 28HA
which provides that a person who reasonably believes that a ground for cancellation of
registration or an alternative order exists, may refer the matter to the Commissioner.
However, the note also makes it clear that the Commissioner does not need a referral to make
an application for a cancellation or alternative order (or both).
Amendment 25 - Schedule 2, item 4, page 19 (after line 28), at the end of Division 3
16. This amendment inserts new section 28HA into the Bill, providing for a person (the
referrer) who reasonably believes that a ground for cancellation of registration set out in
Division 3 exists in relation to an organisation, to refer the matter to the Commissioner.
17. The referral must be in writing, identify and provide contact details for the referrer,
and set out the basis for the reasonable belief that a ground exists.
18. The amendment provides that the Commissioner may, but is not required to, take
action in relation to the referral.
19. The note highlights that the Commissioner may apply for cancellation of registration
or alternative orders in relation to referrals made under section 28HA if he or she considers a
ground applies in relation to an organisation.
20. The referral mechanism provided for in this amendment does not limit the ability of a
person to contact or otherwise raise with the Commissioner any matter of concern for the
Commissioner's consideration.
Amendment 32 - Schedule 2, item 4, page 22 (line 9)
21. This amendment is consequential to the Commissioner now being the only person who
can make an application for a cancellation or alternative order. It removes the requirement for
the Court to provide the Commissioner with a copy of the cancellation or alternative order as
the Commissioner will now always be the applicant in the proceedings.
Amendment 33 - Schedule 2, item 9, page 24 (lines 24 to 26)
22. This is a consequential amendment that removes the delegation provisions contained
in existing section 343 of the RO Act to reflect that the Minister will no longer have standing
to apply to the Court for disqualification, cancellation or alternative orders.
Disqualification
Amendment 4 - Schedule 1, item 11, page 6 (line 23)
Amendment 5 - Schedule 1, item 11, page 6 (line 24)
23. These are consequential amendments to Amendments 6 and 7.
Senate page 3 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
Amendment 6 - Schedule 1, item 11, page 6 (line 26)
Amendment 7 - Schedule 1, item 11, page 6 (after line 31), after subsection 222(2)
24. Amendment 6 clarifies and confirms that it is the Commissioner who has the legal
burden of satisfying the Court that it would not be unjust to disqualify the person having
regard to the matters set out in paragraph 222(2)(b) of the Bill.
25. Amendment 7 explicitly provides that the Court must not make a disqualification
order unless it is satisfied, having regard to the gravity of the matters constituting the ground,
that disqualification would not be unjust - subsection 222(2A).
Amendment 9 - Schedule 1, item 11, page 7 (lines 6 to 10)
26. This amendment amends the ground for disqualification in subsection 223(1) to
provide that a ground for disqualification exists if:
a criminal designated finding is made against the person within the meaning of new
section 9C(1)(a) (criminal), (other than offence covered by subsection 223(4) which
relates to breaches of officers' and directors' duties) - paragraph 223(1)(a); or
one or more designated findings are made against the person under new section
9C(1)(b) (civil) within the last 10 years (other than a contravention covered by
subsection 223(4) which relates to breaches of officers' and directors' duties) and the
maximum penalty or the combined total of the maximum penalties for the
contravention or contraventions amount to at least 180 penalty units, or the equivalent
of 180 penalty units (see section 4AA of the Crimes Act for the value of a penalty
unit) - paragraph 223(1)(b); or
the person is found to be in contempt of court in relation to an order or injunction
made under a designated law - paragraph 223(1)(c).
27. This amendment makes substantive changes to the ground now contained in paragraph
223(1)(b) related to civil contravention. For the ground to apply, the person must have, in the
past 10 years, been ordered to pay a pecuniary penalty for the relevant contraventions of civil
penalty provisions that amount to at least 180 penalty units for individuals. This can include
one contravention of a civil penalty provision that has a maximum penalty set at 180 penalty
units or more, or a number of civil penalty provision contraventions where the maximum
penalties attached to those contraventions add up to 180 penalty units (for example, three
contraventions where each of the maximum penalty amounts is 60 penalty units). Consistent
with the existing Bill, only conduct that occurs after commencement can give rise to this
ground. The timeframe and penalty unit threshold included in the amendment is intended to
ensure that only those officers with an ongoing pattern of serious non-compliance can
establish this ground for disqualification. The Court must also be satisfied that making the
order would not be unjust, including having regard to the gravity of the matters constituting
the ground.
Amendment 10 - Schedule 1, item 11, page 7 (lines 20 to 30)
28. This amendment amends subsection 223(3) of the Bill in relation to the ground of
multiple failures to prevent contraventions etc. by an organisation. The amendment
Senate page 4 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
substantively replicates the effect of that ground as introduced where there is more than one of
a criminal designated finding within the meaning of paragraph 9C(1)(a) or a contempt of
court in relation to an order or injunction made under a designated law against an
organisation. The amendment modifies the ground as introduced to provide that where one of
the above two exist and is coupled with a designated finding within the meaning of paragraph
9C(1)(b) (civil), then a ground for disqualification applies in relation to conduct that occurs
after commencement, whilst the person was an officer of the relevant organisation, and the
officer was in a position to take reasonable steps to prevent that conduct and the officer failed
to take such steps.
29. The ground will not apply if there are only two (civil) designated findings as defined
by subsection 9C(1)(b). This circumstance is covered by Amendment 11.
Amendment 11 - Schedule 1, item 11, page 7 (after line 30), after subsection 223(3)
30. This amendment includes a new ground for disqualification that applies if:
two or more (civil) designated findings within the meaning of paragraph 9C(1)(b)
have been made against any organisation within the past 10 years in relation to
conduct engaged in while the person is an officer of the organisation; and
the combined total of the maximum penalties for contraventions to which the
designated findings relate is at least 900 penalty units; and
the person failed to take reasonable steps to prevent the conduct.
31. This amendment provides that where designated findings solely relate to civil
contraventions against the organisation, there must be a contravention of two or more civil
penalty provisions and the maximum collective penalties must amount to at least 900 penalty
units (see section 4AA of the Crimes Act for the value of a penalty unit) for the ground to
exist. This can include two contraventions of civil penalty provisions where maximum
penalties add up to at least 900 penalty units (for example, one contravention where the
maximum penalty is 1,000 penalty units and a second contravention where the maximum
penalty is 300 penalty units), or a greater number of civil penalty provision contraventions
where the maximum penalties of those provisions add up to at least 900 penalty units (for
example, three contraventions where each of the maximum penalties is 300 penalty units).
32. This ground for disqualification can only apply to findings made in relation to conduct
that occurs after commencement, whilst the person was an officer of the relevant organisation,
and the officer was in a position to take reasonable steps to prevent that conduct and the
officer failed to take such steps.
33. The higher penalty unit value as compared to that provided for by Amendment 9
reflects that the civil penalties that can be imposed upon a body corporate are five times those
that can be imposed upon an individual (see section 306 of the Act).
Amendment 12 - Schedule 1, item 11, page 8 (line 1)
34. This is an amendment to the heading of the ground under new subsection 223(4)
'Breach of directors' and officers' duties' that is consequential to Amendment 13.
Senate page 5 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
Amendment 13 - Schedule 1, item 11, page 8 (before line 3), before paragraph 223(4)(a)
35. This amendment is consequential to the changes made to the designated finding
ground in new paragraph 223(1)(a) (see Amendment 9). This amendment amends the existing
ground for disqualification based on corporate impropriety in subsection 223(4) to include
where a designated finding is made against a person and it relates to an offence against, or a
contravention of, a provision of Division 2 of Part 2 of Chapter 9 (general duties in relation to
the financial management of organisations). Such contraventions were previously captured by
paragraph 223(1)(a) but now are situated in this ground with the comparable directors' duties
that apply under the Corporations Act. Co-locating contraventions of officer and director
duties together reflects the fundamental importance of the respective duties in protecting the
interests of organisations (and their members) and corporations (and their shareholders).
Amendment 16 - Schedule 1, item 17, page 12 (line 8)
Amendment 17 - Schedule 1, item 17, page 12 (line 14)
Amendment 18 - Schedule 1, item 17, page 12 (after line 17), after paragraph 17(2)(b)
36. These are consequential amendments to the changes made to the disqualification
grounds and provide that a ground can only be established by conduct and events that occur
after commencement.
Cancellation and alternative orders
Amendment 21 - Schedule 2, item 4, page 15 (lines 11 to 13)
37. This amendment to the simplified outline confirms and clarifies that the
Commissioner bears the legal burden of satisfying the Court that cancellation of the
registration of an organisation would not be unjust and is consequential to Amendments 26,
27 and 29.
Amendment 26 - Schedule 2, item 4, page 20 (line 5)
Amendment 27 - Schedule 2, item 4, page 20 (lines 9 and 10)
Amendment 29 - Schedule 2, item 4, page 20 (after line 22), after subsection 28J(1)
38. These amendments amend new section 28J of the Bill in relation to when the Court
may make an order cancelling the registration of an organisation.
39. The amendments provide that the Court may cancel the registration of an organisation
if:
the Court is satisfied that a ground for cancellation of registration is established; and
the Commissioner satisfies the Court that it would not be unjust to cancel the
organisation's registration (Amendments 26 and 27).
40. The existing matters in new paragraph 28J(1)(b) that the Court must have regard to in
determining whether it would be unjust to cancel the organisation's registration are
unchanged, being:
Senate page 6 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
the nature of the matters constituting the ground;
the action (if any) that has been taken by or against the organisation or its members or
officers in relation to those matters;
the best interests of the members of the organisation as a whole; and
any other matters the Court considers relevant.
41. Amendment 29 explicitly provides that the Court must not cancel an organisation's
registration unless it is satisfied, having regard to the gravity of the matters constituting the
ground, that cancellation would not be unjust - new subsection 28J(1A).
42. The matters in paragraph 28J(1)(b) and new subjection 28J(1A) mean that for
example, if the Court considered that the conduct giving rise to the ground related (wholly or
partly) to pursuing a public health issue such as safety concerns in relation to asbestos
exposure or patient care, the Court could decide not to cancel the organisation's registration if
it determined it would be unjust to do so.
Amendment 28 - Schedule 2, item 4, page 20 (lines 18 and 19)
43. This amendment amends Note 1 to new subsection 28J(1) and is consequential to
Amendment 27 and makes clear that if the Commissioner fails to satisfy the Court that it
would not be unjust to cancel the organisation's registration, the Court may decide to make an
alternative order.
Amendment 30 - Schedule 2, item 4, page 21 (lines 11 and 12)
Amendment 31 - Schedule 2, item 4, page 21 (after line 12)
44. Amendment 30 amends new paragraph 28L(1)(b) to provide that the Court may make
an alternative order if the Commissioner fails to satisfy the Court that it would not be unjust
to cancel the organisation's registration.
45. Amendment 31 explicitly provides that the Court must not make an alternative order
unless it is satisfied that, having regard to the gravity of the matters constituting the ground,
the order would not be unjust - new subsection 28L(1A).
Amendment 23 - Schedule 2, item 4, page 16 (lines 24 to 28)
46. This amendment removes the current ground for cancellation of registration or
alternative orders in new subparagraph 28C(1)(b)(i) where the affairs of the organisation of
part of the organisation have been or are being conducted in a manner that is oppressive or
unfairly prejudicial to, or unfairly discriminatory against, a member or a class of members.
47. The amendment means that a ground under paragraph 28C(1)(b) will now only exist
where the affairs of the organisation or part of the organisation have been or are being
conducted in a manner that is contrary to the interests of the members of the organisation or
part as a whole. This amendment recognises that in registered organisations, particularly in
the context of collective bargaining, groups of members can have competing interests and
there can be a perception that one group of members has been treated less favourably than
Senate page 7 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
another group. The amendment is intended to ensure that the ground is not enlivened upon
such issues arising within organisations.
Grounds for cancellation
Amendment 24 - Schedule 2, item 4, page 17 (line 30)
48. This amendment ensures that the penalty unit value ascribed to the ground of serious
offence committed by an organisation in new section 28D is that set out in section 4AA of the
Crimes Act.
Public interest test for amalgamations
Amendment 34 - Schedule 4, item 2, page 34 (lines 19 to 22)
Amendment 35 - Schedule 4, item 6, page 35 (lines 13 to 15)
49. Amendment 34 makes a consequential amendment to the Simplified outline of the
Division to reflect the fact that before an amalgamation can take effect, the FWC must decide
whether the amalgamation should be subject to a public interest test. The amalgamation does
not take effect if the FWC decides that the public interest is to apply to the amalgamation and
that the amalgamation fails that test.
50. Amendment 35 is also a consequential amendment that replaces new subsection 67(4)
to provide that subsection 67(2) does not authorise the FWC to dispense with deciding
whether the public test applies or, if it does apply, whether the amalgamation is in the public
interest, when making orders in relation to a further ballot if an amalgamation is not approved
in a ballot.
Amendment 36 - Schedule 4, item 7, page 35 (lines 19 to 27)
51. This amendment removes new section 72A from the Bill and includes new sections
72A and 72AA.
52. The amendment provides that before fixing an amalgamation day under section 73 of
the Act for a proposed amalgamation, the FWC must:
decide whether the public interest test in paragraph 72A(1)(b) is to apply to the
amalgamation; and
if the public interest test is to apply to the amalgamation - decide whether the
amalgamation is in the public interest.
53. Note 1 to new subsection 72A(1) alerts the reader to the fact that in deciding whether
the amalgamation passes the public interest test, the FWC must have regard to the matters in
section 72D.
54. Note 2 to new subsection 72A(1) further alerts the reader to the fact that an
amalgamation does not take effect if the FWC decides that the public interest test is to apply
to the amalgamation and the amalgamation fails that test.
Senate page 8 Fair Work (Registered Organisations) Amendment
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Notes on Amendments
55. New subsection 72A(2) provides that the FWC must, and may only, decide under
paragraph (1)(a) that the public interest test is to apply to the amalgamation if there is
information before the FWC that at least 20 compliance record events have occurred for one
or more of the existing organisations seeking to amalgamate within the 10 year period prior to
the most recent application relating to the amalgamation under section 44 of the Act.
56. The note to new subsection 72A(2) alerts the reader to the fact that the FWC has ways
of informing itself about whether compliance record events have occurred as outlined in
section 590 of the FW Act. These include: conducting inquiries and requiring a person to
provide copies of documents or records, or to provide any other information to the FWC. It
will be a matter for the FWC to determine how to inform itself in each particular case.
57. The effect of these amendments will therefore be to require a Full Bench of the FWC
to consider as a preliminary matter, whether a proposed amalgamation should be subject to
the public interest test in the Bill. The amendments are intended to ensure that organisations
that abide by workplace laws and therefore do not have a history of non-compliance with the
law, will not be subject to a public interest test should they wish to amalgamate.
58. New section 72AA requires the FWC to publish written reasons for decisions made
under new subsection 72A(1) as soon as practicable after making the decision. Any decision
and reasoning must be expressed in plain English and be easy to understand in structure and
content. This new provision does not limit the FWC's power to put decisions in writing or
publish decisions.
Amendment 37 - Schedule 4, item 7, page 35 (line 29)
Amendment 38 - Schedule 4, item 7, page 36 (lines 1 to 3)
59. These are consequential amendments to provide that if the FWC decides that the
public interest test in new paragraph 72A(1)(b) is to apply to a proposed amalgamation, the
FWC must fix a time and place for hearing submissions in relation to:
the matters mentioned in subsection 72D(1) (record of compliance with law), and
whether the amalgamation is otherwise in the public interest.
60. The effect of these amendments is that were the FWC to determine to apply the public
interest to a proposed amalgamation, the hearing can deal with all of the matters in new
subsection 72B(a).
Amendment 39 - Schedule 4, item 7, page 36 (lines 9 to 18)
Amendment 40 - Schedule 4, item 7, page 37 (lines 3 to 10)
61. These are amendments consequential to amendments 37 and 38.
Amendment 41 - Schedule 4, item 7, page 37 (line 13)
Amendment 43 - Schedule 4, item 7, page 37 (line 19)
Amendment 44 - Schedule 4, item 7, page 37 (line 23)
Senate page 9 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
Notes on Amendments
Amendment 45 - Schedule 4, item 7, page 38 (line 30)
Amendment 46 - Schedule 4, item 7, page 39 (line 2)
62. These are consequential technical amendments to reflect the fact that the public
interest test is now contained in paragraph 72A(1)(b).
Amendment 42 - Schedule 4, item 7, page 37 (line 16)
63. This amendment amends the matters that the FWC must have regard to in determining
whether an organisation has a record of not complying with the law, for the purpose of
determining whether the proposed amalgamation is in the public interest.
64. In deciding whether the amalgamation is in the public interest, the FWC must have
regard to any compliance record events within the meaning of new section 72E that have
occurred for each of the existing organisations (subsection 72D(1)).
65. This amendment includes 'gravity' of compliance record events in new subsection
72D(2) so that the FWC must have regard to the incidence, age and gravity of compliance
record events for each existing organisation, to determine whether the organisation has a
record of not complying with the law.
Amendment 47 - Schedule 4, item 9, page 39 (lines 11 and 12)
66. This is a consequential amendment to subsection 73(2) to reflect the fact the two kinds
of decisions can be made by the FWC under new section 72A.
Amendment 48 - Page 42 (after line 22) at the end of the Bill, add:
67. This amendment amends existing section 329AB of the RO Act (Functions of the
Commissioner) to insert a new subsection 329AB(2). The amendment provides that in
carrying out the function of promoting the efficient management of registered organisations
and high standards of accountability of registered organisations and their office holders to
their members, the Commissioner must give priority to matters that raise serious or systemic
concerns. This will mean that in the exercise of this function, the Commissioner will have a
comparatively lesser focus on trivial or otherwise minor matters.
Senate page 10 Fair Work (Registered Organisations) Amendment
(Ensuring Integrity) Bill 2019
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