Australia: Fair Work Amendment Act 2012: unfair dismissal and other changes

Last Updated: 21 March 2013
Article by Nick Noonan

The Fair Work Amendment Act 2012 (Cth) (FWA Act) received Royal Assent on 4 December 2012. The FWA Act implements a number of recommendations from the independent Fair Work Act Review, and other changes arising from the Minister's consultation with stakeholders such as members of the National Workplace Relations Consultative Council, small business representatives, the Fair Work Ombudsman and Fair Work Australia. Many of the changes came into effect on 1 January 2013.

There are four key elements to the FWA Act:

  1. Changes to the unfair dismissal regime;
  2. Changes to the structure and operation of Fair Work Australia;
  3. Establishing an expert panel to conduct the annual minimum wage review and to determine the most suitable funds to be listed as default funds in modern awards; and
  4. Other technical and clarifying amendments.

Time limits on unfair dismissal and general protections claims

The timeframes for making unfair dismissal claims and general protections dismissal claims have been aligned at 21 days. This represents an extension of the time period within which unfair dismissal claims must be made under s 394(2)(a). Currently, these claims must be made to Fair Work Australia within 14 days of the dismissal.

The time period within which a general protections claim (arising from termination) must be brought has been reduced under the changes to s 366(1)(a) from the current 60 days from the date termination takes effect.

These changes should be welcomed by employers, as employees will now need to decide whether to lodge an unfair dismissal or a general protections claim.

Costs in unfair dismissal claims

The Commission is now able to make a costs order against a party in an unfair dismissal matter if it is satisfied that the first party caused the other party to incur costs because of an unreasonable act or omission by the first party (amendment s 400A). This recommendation reflects concerns that unscrupulous lawyers or agents are encouraging dismissed employees to pursue unfair dismissal claims without merit on a no-win, no-fee basis.

Fair Work Australia

With the passing of this legislation, Fair Work Australia has been renamed the Fair Work Commission. There are also now two vice-presidents in the newly named Commission, in order to attract more senior specialists. The criteria for appointment of Vice Presidents will be the same as for the President of Fair Work Australia, and appointments to these senior positions within the Fair Work Commission will follow a merit based selection process.


A significant change is the introduction of default superannuation funds for employees who do not nominate their own superannuation fund and are covered by a modern award. This is reflected in the FWA Act's proposal to insert a new s 149C requiring each modern award to contain a default fund term.

A new process will determine the most suitable funds to be listed as default superannuation funds in modern awards to meet the principles and model outlined by the Productivity Commission.

Technical Amendments

The FWA Act also implements several technical and clarifying recommendations made by the Fair Work Act Review, including:

  • Prohibiting opt-out clauses in enterprise agreements;
  • Clarifying that statutory enterprise agreements cannot be made with a single employee;
  • Clarifying notification requirements for scope order applications;
  • Clarifying what may be included in a notice of representative rights to employees;
  • Prohibiting an individual union official being a bargaining representative of an employee where the union does not have coverage;
  • Clarifying when a modern award variation application can be struck out and who can apply for a modern award to be varied; and
  • Clarifying how protected action ballots can be conducted, while preserving the existing strict requirements and processes around when protected industrial action can be taken.

Please do not hesitate to contact us if you require any clarification on the impact of these changes.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

Kemp Strang has received acknowledgements for the quality of our work in the most recent editions of Chambers & Partners, Best Lawyers and IFLR1000.

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Nick Noonan
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