Fair Work (Registered Organisations) Amendment Act 2012

The Fair Work (Registered Organisations) Amendment Act 2012 is not a general workplace law for all employers. It is an amending Act that changes the Fair Work (Registered Organisations) Act 2009, and its direct focus is registered organisations and their branches. In practical terms, that means bodies such as registered trade unions and registered employer associations.

The people most directly affected are officers of those organisations and branches, especially where their duties relate to financial management, governance, disclosure, investigations or compliance with organisational rules. The Act also expressly deals with branches in several places, so branch-level governance and compliance settings matter, not just the national body.

Most ordinary businesses are usually outside the direct scope of this Act. A retailer, café, software company, consultancy or manufacturer does not become subject to these amendments just because it employs staff. The more realistic business touchpoints are where a business participates in a registered employer association, has a director or senior employee serving as an officer of a registered organisation, or deals with a registered organisation that is responding to an investigation or updating its rules.

The Act introduced a package of governance, investigation and disclosure-related changes. At a practical level, it added an approved training mechanism for officers' financial management duties, expanded the General Manager's investigation powers, created additional civil penalty provisions for non-compliance with certain information-gathering requirements, and set up staged changes around organisational rules and model rules.

One early amendment inserted a statement that Parliament recognises and respects the role of employer and employee organisations in facilitating the operation of the workplace relations system. Beyond that statement, the practical emphasis of the Act is stronger accountability and more formal compliance settings for registered organisations and branches.

The Act also changed penalty settings in section 306 of the principal Act. It increased the general figures in subsection 306(1), and it inserted subsection 306(1A), which specifically allows the Federal Court to impose pecuniary penalties for contraventions of subsections 337AA(1), (2) or (3). For those contraventions, the maximum is 150 penalty units for a body corporate and 30 penalty units in any other case.

Later commencement parts added model rule mechanisms and expanded definitions relevant to disclosure and related party concepts, including control, entity, non-cash benefit, remuneration, spouse, relative and related party. Those later definitional changes matter because they shape how organisations identify relationships, benefits and transactions that may need to be addressed under the principal Act.

For registered organisations, the amendments matter when certain events happen. One trigger point is officer training. The Act gives the General Manager power to approve training provided by an organisation, a peak council, or another body or person with appropriate skills and expertise, if the training covers one or more duties of officers of organisations and branches that relate to financial management.

Another trigger point is an investigation. The Act expands the General Manager's ability to require information, documents and attendance, and also inserts an additional power in section 335A for a further person in the circumstances set out in that section. Written notices under that additional power must allow at least 14 days. If attendance is required, the notice must state that the person may be accompanied by another person, who may be a lawyer but does not have to be.

Rule changes are another practical trigger. The Act includes transitional arrangements for eligible alterations of organisational rules and for early applications for exemption where a complying rule would be too onerous because of special circumstances. It also introduced model rule mechanisms for expenditure and disclosure matters from 1 July 2013.

From 1 January 2014, the expanded definitions around related parties, relatives, spouses, de facto partners, control, remuneration and non-cash benefits become especially important when an organisation is assessing whether a payment, benefit or relationship falls within its disclosure and governance settings under the principal Act.

A major practical feature of the Act is the expansion of investigation powers. Section 335 was retitled to deal with the general power to require information and related material during investigations, and the Act also inserted section 335A, which creates an additional power to require information, documents or attendance from a further person where the statutory conditions are met.

Under section 335A, the General Manager may issue a written notice requiring the person to give information, produce or make available documents, or attend to answer questions and produce records and other documents relating to relevant matters. The period or time specified must be at least 14 days after the notice is given, and the time and place for production or attendance must be reasonable. A notice requiring attendance must also state that the person may be accompanied by another person, who may be, but does not have to be, a lawyer.

The Act also inserted section 335B, which requires the General Manager to complete an investigation as soon as practicable. It inserted section 335C, which permits disclosure of information acquired during an investigation where the General Manager reasonably believes disclosure is necessary or appropriate in performing functions or exercising powers, or is likely to assist administration or enforcement of a Commonwealth, State or Territory law.

After notifying a reporting unit of a contravention under section 336(1), the General Manager must also, within 12 months, make inquiries under section 330 as to whether the reporting unit is complying with the provision, guidelines or rule that was the subject of the notification.

The additional power in section 335A is backed by civil penalty provisions in section 337AA. A person must comply with a requirement made under subsection 335A(2). A person must also not give information or produce a document in purported compliance if they know, or are reckless as to whether, it is false or misleading. The same applies to statements made when attending in response to the requirement.

The Act preserves a reasonable excuse exception for failure to comply with subsection 337AA(1), but places an evidential burden on the defendant to show a reasonable excuse. The Act also deals with self-incrimination. A person is not excused from giving information, producing documents or answering questions under the relevant powers on the ground that it may tend to incriminate them or expose them to a penalty. However, for individuals, the Act provides use and derivative use protections in the proceedings specified by the legislation, subject to the stated exceptions for false or misleading information or statements.

The approved training provisions are aimed at officers' duties that relate to the financial management of organisations and branches. Under section 154C, the General Manager may approve training if satisfied it covers one or more of those duties. The Act also included a transitional requirement that, before the commencement of Part 2 of the Schedule, the General Manager approve training covering all such duties.

On the rules side, the Act includes transitional arrangements that let organisations lodge particulars of an eligible alteration of rules during the transition period. For this purpose, an eligible alteration is defined narrowly. The only purpose of the alteration must be to comply with specified provisions of the principal Act as they would operate immediately after the commencement of Part 2. If certified during the transition period, the alteration takes effect on the later of the day of certification and the day Part 2 commences.

The Act also allows early applications for exemption from section 148C in special circumstances where a complying rule would be too onerous. An early application had to be accompanied by the statement, particulars and evidence referred to in subsection 148D(2). If the General Manager was satisfied of the required matters, an exemption could be granted and would take effect from the later of the grant and the commencement of Part 2. The Act also states that this early application mechanism applies to branches as if references to an organisation were references to a branch.

From 1 July 2013, the Minister may issue Gazette guidelines containing one or more sets of model rules dealing with expenditure matters and model rules relating to disclosure. Organisations and branches may adopt those model rules in whole or in part, and with or without modification. The Act expressly states that those notices are not legislative instruments.

From 1 January 2014, the definitional changes support the disclosure framework by clarifying concepts such as related party, remuneration and non-cash benefit. For example, non-cash benefit is defined as property or services in any form other than money, but excludes a computer, mobile phone or other electronic device used only or mainly for work purposes. Remuneration includes pay, wages, salary, fees, allowances, leave, benefits or other entitlements, but does not include a non-cash benefit.

If you run an ordinary business and are not part of a registered organisation structure, this Act is usually background law rather than a direct compliance regime for you. It is still worth understanding if your business depends on a registered employer association for representation or if someone in your business also serves as an officer of a registered organisation.

If you are involved with a registered organisation, the practical reading points are narrower and more important. Check whether the organisation or branch is subject to approved training requirements, whether any investigation notices have been issued, whether internal document handling is strong enough to respond accurately and on time, and whether rules and disclosure settings were updated for the staged commencement dates.

The distinction between direct and indirect impact matters. Direct impact usually falls on the registered organisation, its branch and its officers. Indirect impact is more likely to arise for a business that is a member of a registered employer association, receives services from one, or has personnel who hold office in one. In those cases, the business may need to support training, disclosures, document production or governance changes, even though the Act does not regulate the business in the same way it regulates the organisation.

Because the Act commenced in stages, businesses and organisations should not assume every amendment started at the same time. The date matters. Some powers and transitional arrangements began on Royal Assent on 29 June 2012, model rule provisions began on 1 July 2013, and further definitional and related party changes began on 1 January 2014.

Before relying on this page, check four things. First, confirm whether the entity is actually a registered organisation or branch under the principal Act. Second, identify which commencement date applies to the issue you are dealing with. Third, check whether the issue concerns training, investigations, rules, model rules or later disclosure definitions. Fourth, read the current consolidated legislation because this Act amends the principal Act and later amendments may also affect the position.

The Act received Royal Assent on 29 June 2012. Sections 1 to 3 and Schedule 1 Part 1 commenced on that date. Schedule 1 Part 1A commenced on 1 July 2013. Schedule 1 Part 2 commenced on 1 January 2014.

The legislation register identifies the Act as in force. The compilation referred to in the legislation extract started on 29 June 2013 and included amendments up to Act No. 73 of 2013. As with any amending Act, the safest practical approach is to read it together with the current version of the Fair Work (Registered Organisations) Act 2009 and any later amendments affecting the same subject matter.

This page explains the Fair Work (Registered Organisations) Amendment Act 2012 as an amending Act. Many of its practical effects are best understood by reading the inserted and amended provisions in the Fair Work (Registered Organisations) Act 2009. If you are dealing with a live compliance issue, review the current consolidated legislation and the exact wording of any notice, rule or disclosure obligation that applies.