Division Description Changes — Bills — Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020; Second Reading — 9th Dec 2020

Change	Division
senate vote 2020-12-09#9 Edited by mackay staff on 2021-01-15 12:57:20	Title Bills — Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020; Second Reading Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020 - Second Reading - Refer to Committee Description ~~<p class="speaker">Simon Birmingham</p>~~ ~~<p>I move:</p>~~ ~~<p class="italic">That this bill be now read a second time.</p>~~ The majority voted against an [amendment](https://www.openaustralia.org.au/senate/?gid=2020-12-09.140.1) introduced by NSW Senator [Mehreen Faruqi](https://theyvoteforyou.org.au/people/senate/nsw/mehreen_faruqi), which means it failed. The amendment would have added the words set out below to the usual [second reading motion](https://peo.gov.au/understand-our-parliament/how-parliament-works/bills-and-laws/making-a-law-in-the-australian-parliament/) "that the bill be read a second time" (parliamentary jargon for agreeing with the main idea of the bill). ### Amendment text > At the end of the motion, add: ", but the Senate: > *> (a) notes t*hat the Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020 was introduced, debated and passed through the House of Representatives on the same day, Wednesday 9 December; > *> (b) further notes there is no urgent reason for the B*ill to be rushed through Parliament; > > (c) recognises the Bill may have implications for all unions and Australian workers and should not be rushed through without proper scrutiny; and > > (d) refers the Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020 to the Education and Employment Legislation Committee for inquiry and report by 4 February 2021". ~~<p>I seek leave to have the second reading speech incorporated in <i>Hansard</i>.</p>~~ ~~<p>Leave granted.</p>~~ ~~<p class="italic"> <i>The speech read as follows—</i></p>~~ ~~<p class="italic">This Government is committed to ensuring that the industrial relations framework continues to adapt and change to meet the needs of businesses and workers alike.</p>~~ ~~<p class="italic">This year—more than ever—has highlighted the need for flexibility for workers and employers—and the organisations that represent them.</p>~~ <p class="italic">This Bill will give greater flexibility to constituent parts, such as branches and divisions, of amalgamated registered organisations, by providing them with an opportunity to withdraw from an amalgamation if that will better serve them and their members.</p> <p class="italic">This Bill will amend the <i>Fair Work (Registered Organisations) Act 2009</i> (the Act) to address a current restriction in the Act—which only provides a constituent part of an amalgamated organisation with a three year window to withdraw from the amalgamated organisation—more than two years, but no later than five years, after amalgamation.</p> ~~<p class="italic">That outer time limit of five years restricts the ability of registered organisations to adapt to, and align their governance structure with, the changing needs of members.</p>~~ <p class="italic">There are various circumstances that might give rise to a constituent part of an amalgamated organisation forming the view that the amalgamation is no longer serving the best interests of its members.</p> <p class="italic">For example, where one part of the organisation has a record of not complying with the law and this causes reputational damage for the amalgamated organisation, another part may seek to dissociate itself from those activities.</p> <p class="italic">In other circumstances, parts of an amalgamated organisation may have outgrown the need for amalgamation, having developed sufficiently to operate independently, efficiently and effectively. In these cases, withdrawal from amalgamation may be highly desirable.</p> <p class="italic">Under the current law, beyond the five year time limit for withdrawal, an organisation must take the extreme step of seeking deregistration of the entire amalgamated organisation, which may not even be achievable. This process would be costly and time consuming, and could leave members without representation while the organisation is deregistered and new organisations registered.</p> <p class="italic">Even where deregistration is possible, the new organisation must seek registration in its own right and is not able to transfer members or assets from the previous amalgamated organisation, adding to the cost and delay.</p> <p class="italic">The Bill remedies the shortcomings of the existing framework by improving the existing process under the Act to allow constituent parts of amalgamated organisations to apply to withdraw from amalgamation beyond the five year time limit. The amendments will allow the constituent part—which could be a branch, division or part—to apply to the Fair Work Commission to hold a ballot of its members on whether to withdraw from the amalgamation in certain specified circumstances.</p> <p class="italic">The Commission must have regard to specified factors before approving an application for a ballot of members to vote on withdrawal from amalgamation outside the existing three year period. These are:</p> <ul></ul><ul></ul><p class="italic">Where the Commission determines that the organisation has a record of non-compliance with workplace or safety laws but the constituent part has not contributed to that record, the Commission must accept the application.</p> <p class="italic">A clear short-coming of the current law means that even if the performance or actions of one part of an amalgamated organisation fall beneath proper, lawful standards, and even if other members of the organisation who do the right thing do not believe it is in their best interests to remain part of the organisation, they are not able to leave, even where the majority of its members wish to.</p> <p class="italic">Within the union movement, there are clear examples where the poor conduct of one part of a union is impeding the ability of other law-abiding divisions of the union to work effectively in the interests of their members. Now constituent parts who have been amalgamated beyond the current 5 year limit will have the freedom to break away and better serve the interests of their members.</p> <p class="italic">The Bill also provides that, where a part successfully withdraws from the amalgamation, the membership of that part will become members of the newly registered organisation. This ensures the new registered organisation can maintain its membership and assets and its members can continue to be represented by their newly registered organisation. The Bill also sets out a process for how the rules of the amalgamated organisation and newly registered organisation are to be accommodated under the new arrangement.</p> <p class="italic">The Bill makes no changes to the requirements for the members of registered organisations and their constituent parts to vote and agree to amalgamation or withdrawal from amalgamation.</p> ~~<p class="italic">To ensure that the legislation is working effectively, the Bill requires a review of the operation of the amendments within two years of their commencement.</p>~~ ~~<p class="italic">These are sensible changes that support registered organisations to function effectively and in the best interests of their members.</p>~~ ~~<p class="speaker">Jenny McAllister</p>~~ <p>The bill before us, the Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020, represents a commonsense, reasonable and technical amendment to the registered organisations act, specifically the provisions in the act that deal with withdrawal from amalgamation. Currently the act allows a constituent part of an amalgamated union to withdraw from the remainder of the union. It is a democratic process involving a secret ballot of the members of that part of the union seeking to withdraw from the amalgamation. The problem is that these provisions only apply between two and five years after an amalgamation. That's a narrow window and it doesn't contemplate the possibility that a demerger could happen after that time.</p> <p>The drafters of the original legislation most probably did not foresee circumstances in which an amalgamated union might wish to withdraw from the merger after five years, but, as with any partnership, there are often very good reasons that it might be better for the partners to go their separate ways and operate independently. This bill corrects that by creating an exception to this time limitation via a new appropriateness test in clause 94A of the bill. This provision allows the Fair Work Commission to grant an application for a withdrawal ballot if certain conditions are met. These conditions guide the discretion of the Fair Work Commission. A proposed new section, 94A(2), sets out these conditions, which include whether the amalgamated organisation has a record of 'not complying with workplace safety laws and any contribution of the constituent part to that record' and the likely capacity of the constituent part, after it withdraws from the merger, to promote and protect the economic and social interests of its members.</p> <p>If a secret ballot of members of the constituent part seeking to withdraw from the amalgamation is successful, the legislation then sets out some clear rules for how the separation takes place. It will require the applicant to file its plans for withdrawal, which include the rules of the amalgamated union and the proposed new union, the names of the respective organisations postwithdrawal and the allocation of assets and liabilities between the amalgamated organisation and the newly registered organisation. The rules set out must avoid any overlap in coverage between the demerged entities.</p> <p>The bill also makes provisions for ballots other than postal ballots conducted by the AEC. This is to recognise that some unions are currently exempted from the requirement to use the AEC for union elections. It also recognises that a number of unions have an existing custom and practice of having attendance ballots as their preferred means of collective decision-making.</p> ~~<p>I note the bill provides for a review of its operation within two years of its enactment. This is a safeguard to ensure that the bill is operating in the manner intended.</p>~~ <p>I said at the outset that this is a sensible amendment bill that reflects the fact that some mergers have gone beyond the three-year limitation that currently exists in the Fair Work (Registered Organisations) Act 2009. Like the nature of work itself, trade unions change to reflect the workforce they represent. As industries grow, shrink or simply change, so does the representation of the workers in those industries. Work and workplaces are ever-evolving, and we should recognise that. A union must be relevant and able to represent its workers. We also need to recognise the principle of freedom of association, which includes a right to join or leave a group, and that right doesn't only operate within a three-year time period. As such, Labor supports the bill.</p> ~~<p class='motion-notice motion-notice-truncated'>Long debate text truncated.</p>~~

~~Simon Birmingham~~
~~I move:~~
~~That this bill be now read a second time.~~
The majority voted against an [amendment](https://www.openaustralia.org.au/senate/?gid=2020-12-09.140.1) introduced by NSW Senator [Mehreen Faruqi](https://theyvoteforyou.org.au/people/senate/nsw/mehreen_faruqi), which means it failed. The amendment would have added the words set out below to the usual [second reading motion](https://peo.gov.au/understand-our-parliament/how-parliament-works/bills-and-laws/making-a-law-in-the-australian-parliament/) "*that the bill be read a second time*" (parliamentary jargon for agreeing with the main idea of the bill).
### Amendment text
> *At the end of the motion, add: ", but the Senate:*
>
> *(a) notes that the Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020 was introduced, debated and passed through the House of Representatives on the same day, Wednesday 9 December;*
>
> *(b) further notes there is no urgent reason for the Bill to be rushed through Parliament;*
>
> *(c) recognises the Bill may have implications for all unions and Australian workers and should not be rushed through without proper scrutiny; and*
>
> *(d) refers the Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020 to the Education and Employment Legislation Committee for inquiry and report by 4 February 2021".*
~~I seek leave to have the second reading speech incorporated in Hansard.~~
~~Leave granted.~~
~~ The speech read as follows—~~
~~This Government is committed to ensuring that the industrial relations framework continues to adapt and change to meet the needs of businesses and workers alike.~~
~~This year—more than ever—has highlighted the need for flexibility for workers and employers—and the organisations that represent them.~~
This Bill will give greater flexibility to constituent parts, such as branches and divisions, of amalgamated registered organisations, by providing them with an opportunity to withdraw from an amalgamation if that will better serve them and their members.
This Bill will amend the Fair Work (Registered Organisations) Act 2009 (the Act) to address a current restriction in the Act—which only provides a constituent part of an amalgamated organisation with a three year window to withdraw from the amalgamated organisation—more than two years, but no later than five years, after amalgamation.
~~That outer time limit of five years restricts the ability of registered organisations to adapt to, and align their governance structure with, the changing needs of members.~~
There are various circumstances that might give rise to a constituent part of an amalgamated organisation forming the view that the amalgamation is no longer serving the best interests of its members.
For example, where one part of the organisation has a record of not complying with the law and this causes reputational damage for the amalgamated organisation, another part may seek to dissociate itself from those activities.
In other circumstances, parts of an amalgamated organisation may have outgrown the need for amalgamation, having developed sufficiently to operate independently, efficiently and effectively. In these cases, withdrawal from amalgamation may be highly desirable.
Under the current law, beyond the five year time limit for withdrawal, an organisation must take the extreme step of seeking deregistration of the entire amalgamated organisation, which may not even be achievable. This process would be costly and time consuming, and could leave members without representation while the organisation is deregistered and new organisations registered.
Even where deregistration is possible, the new organisation must seek registration in its own right and is not able to transfer members or assets from the previous amalgamated organisation, adding to the cost and delay.
The Bill remedies the shortcomings of the existing framework by improving the existing process under the Act to allow constituent parts of amalgamated organisations to apply to withdraw from amalgamation beyond the five year time limit. The amendments will allow the constituent part—which could be a branch, division or part—to apply to the Fair Work Commission to hold a ballot of its members on whether to withdraw from the amalgamation in certain specified circumstances.
The Commission must have regard to specified factors before approving an application for a ballot of members to vote on withdrawal from amalgamation outside the existing three year period. These are:
<ul></ul><ul></ul>Where the Commission determines that the organisation has a record of non-compliance with workplace or safety laws but the constituent part has not contributed to that record, the Commission must accept the application.
A clear short-coming of the current law means that even if the performance or actions of one part of an amalgamated organisation fall beneath proper, lawful standards, and even if other members of the organisation who do the right thing do not believe it is in their best interests to remain part of the organisation, they are not able to leave, even where the majority of its members wish to.
Within the union movement, there are clear examples where the poor conduct of one part of a union is impeding the ability of other law-abiding divisions of the union to work effectively in the interests of their members. Now constituent parts who have been amalgamated beyond the current 5 year limit will have the freedom to break away and better serve the interests of their members.
The Bill also provides that, where a part successfully withdraws from the amalgamation, the membership of that part will become members of the newly registered organisation. This ensures the new registered organisation can maintain its membership and assets and its members can continue to be represented by their newly registered organisation. The Bill also sets out a process for how the rules of the amalgamated organisation and newly registered organisation are to be accommodated under the new arrangement.
The Bill makes no changes to the requirements for the members of registered organisations and their constituent parts to vote and agree to amalgamation or withdrawal from amalgamation.
~~To ensure that the legislation is working effectively, the Bill requires a review of the operation of the amendments within two years of their commencement.~~
~~These are sensible changes that support registered organisations to function effectively and in the best interests of their members.~~
~~Jenny McAllister~~
The bill before us, the Fair Work (Registered Organisations) Amendment (Withdrawal from Amalgamations) Bill 2020, represents a commonsense, reasonable and technical amendment to the registered organisations act, specifically the provisions in the act that deal with withdrawal from amalgamation. Currently the act allows a constituent part of an amalgamated union to withdraw from the remainder of the union. It is a democratic process involving a secret ballot of the members of that part of the union seeking to withdraw from the amalgamation. The problem is that these provisions only apply between two and five years after an amalgamation. That's a narrow window and it doesn't contemplate the possibility that a demerger could happen after that time.
The drafters of the original legislation most probably did not foresee circumstances in which an amalgamated union might wish to withdraw from the merger after five years, but, as with any partnership, there are often very good reasons that it might be better for the partners to go their separate ways and operate independently. This bill corrects that by creating an exception to this time limitation via a new appropriateness test in clause 94A of the bill. This provision allows the Fair Work Commission to grant an application for a withdrawal ballot if certain conditions are met. These conditions guide the discretion of the Fair Work Commission. A proposed new section, 94A(2), sets out these conditions, which include whether the amalgamated organisation has a record of 'not complying with workplace safety laws and any contribution of the constituent part to that record' and the likely capacity of the constituent part, after it withdraws from the merger, to promote and protect the economic and social interests of its members.
If a secret ballot of members of the constituent part seeking to withdraw from the amalgamation is successful, the legislation then sets out some clear rules for how the separation takes place. It will require the applicant to file its plans for withdrawal, which include the rules of the amalgamated union and the proposed new union, the names of the respective organisations postwithdrawal and the allocation of assets and liabilities between the amalgamated organisation and the newly registered organisation. The rules set out must avoid any overlap in coverage between the demerged entities.
The bill also makes provisions for ballots other than postal ballots conducted by the AEC. This is to recognise that some unions are currently exempted from the requirement to use the AEC for union elections. It also recognises that a number of unions have an existing custom and practice of having attendance ballots as their preferred means of collective decision-making.
~~I note the bill provides for a review of its operation within two years of its enactment. This is a safeguard to ensure that the bill is operating in the manner intended.~~
I said at the outset that this is a sensible amendment bill that reflects the fact that some mergers have gone beyond the three-year limitation that currently exists in the Fair Work (Registered Organisations) Act 2009. Like the nature of work itself, trade unions change to reflect the workforce they represent. As industries grow, shrink or simply change, so does the representation of the workers in those industries. Work and workplaces are ever-evolving, and we should recognise that. A union must be relevant and able to represent its workers. We also need to recognise the principle of freedom of association, which includes a right to join or leave a group, and that right doesn't only operate within a three-year time period. As such, Labor supports the bill.
~~Long debate text truncated.~~