Employment Law Update

January is a good time of year to ensure that your employment contracts and workplace policies are up to date, so that you can focus on growing your business. If you would like any of your employment documentation reviewed, or have any other questions then please contact Ryan Martin on 9215 7500.

There have also been some developments that may have an impact on your business coming into the new year and you should be aware of.

Modern Award Transitional Provisions

The transitional provisions in Fair Work Modern Awards have now come to an end. Some workers covered by a Modern Award may be entitled to additional allowances or increased minimum wage rates and other workers may no longer be eligible for certain entitlements.

If you are unsure of whether you are meeting your obligations under the Modern Awards or would like to discuss these changes further, please contact us.

Work Health and Safety Bill 2014

At the end of January the public comment period for the Work Health and Safety Bill will close, meaning WA could be one step closer to adopting the model workplace safety legislation that has been introduced in most other Australian states in an effort to harmonize these laws across the country.

We will keep you updated of these changes, but if you have any questions in the meantime, please let us know.

Anti Bullying Laws

In 2014 the anti-bullying legislation was introduced, which entitles workers who “reasonably believe” that they have been bullied at work to make an application for an order to stop bullying. While the first year of these laws being in place did not result in as many claims as expected by the Fair Work Commission, it is still important that you have up to date workplace policies that adequately deal with workplace bullying to help reduce the likelihood of a claim.

The Cost of Sexual Harassment

2014 also saw an increase in cases in which the Courts ordered employers to pay compensation to victims of sexual harassment in the workplace.

In the case of Richardson v Oracle Corporation Australia Pty Ltd, the Federal Court ordered an increase in compensation payable to a worker who had been sexually harassed by a co-worker from $18,000 to $130,000.

In the NSW case of Trolan v WD Gelle Insurance and Finance Brokers Pty Ltd, the Court ordered the employer to pay $730,000 in damages to Ms Trolan, because the employer had failed to provide Ms Trolan with a safe place to work, to take reasonable steps to protect Ms Trolan’s wellbeing and had exposed Ms Trolan to the continued and repeated sexual harassment.

In another case, Ewin v Vergera the Federal Court ordered an employer to pay compensation of $476,000 for conduct that constituted sexual harassment, even though it did not take place in the employer’s premises. The Court extended the meaning of workplace to include places that are reasonably connected to a worker carrying out the duties of their employment.

With this in mind, it is important that you have up to date workplace policies and training that adequately deal with workplace harassment.

High Court rules there is no implied duty mutual trust and confidence

Another important decision in 2014 was the decision of Barker v Commonwealth Bank of Australia, where the High Court settled the matter on whether there was a duty of mutual trust and confidence implied into all contracts of employment. The High Court held that this was not the case, and that there is no implied duty of mutual trust and confidence between employers and their workers. Importantly, Mr Barker’s employment contract specified that the employer’s policies did not form a part of the employment contract and were instead directions of the employer. This distinction is important, and you should ensure that your employment contracts are up to date in accordance with this decision.

If you have any questions about any of this or would like your employment documents to be reviewed to ensure that they are up to date and compliant with the most recent legislative changes and court decisions, then please do not hesitate to contact Ryan Martin on 9215 7500 for a discussion.

Employment Law Update – Heugh v Central Petroleum Ltd

It is important to remember that the potential pitfalls of workplace law are not just limited to the Fair Work jurisdiction. Common law contract breaches can often result in workers making damages claims in the courts. So it is important that you ensure that you have effective employment contracts that properly reflects the agreement you want to have with your workers and ensures that you are not undermining your common law rights as an employer.

In the recent Supreme Court of Western Australia decision Heugh v Central Petroleum Ltd [No 5] [2014] WASC 311 an ex managing director (Heugh) of an oil and gas exploration company has successfully claimed over $1.5 million in damages for wrongful termination by his employer (Central). This occured even though Heugh had been terminated for a serious breach of his employment contract, which would normally justify summary dismissal under common law.

The Court said that while Heugh had seriously breached his contract, he had remedied that breach, though not in the way that Central had requested. While the Court also found other conduct that could have constituted serious misconduct, Heugh’s contract contained terms that meant Central could only terminate Heugh’s contract in specific circumstances and also outlined the steps required to terminate the contract. The Court held that these terms displaced the common law right of summary dismissal and as such the termination amounted to wrongful termination.

Heugh’s employment contract contained other provisions that required Central to give Heugh three months written notice where there was a reasonably valid and lawful reason to terminate. The contract also provided that Heugh would be entitled to seven times the annual average of his pay for the period of three years prior to his termination of employment. However, the Court found that this would only be payable if Heugh was terminated for a reasonably valid and lawful reason, which had not been established. So when awarding damages to Heugh the Court took into account the salary remaining under the term of his contract (nearly three years), the lost opportunity to earn higher remuneration from future salary reviews lost long service leave entitlements and interest, resulting in almost $1.5 million.

This case serves as a useful reminder that employers need to ensure that employment contracts are properly drafted and do not undermine their rights as an employer.

If you have contracts that you have drafted yourself that you would like reviewed or would like Lawfield to draft employment contracts or workplace policies for you, please contact Ryan Martin on 9215 7500.

Employment Law Update

There has been an amendment to the Awards under Fair Work that may mean that any Individual Flexibility Agreements (IFAs) that have been entered into since 4 December 2013 might not meet Fair Work requirements.

The amendment means that new workers cannot enter into an IFA at the same time as their employment contract. Workers should only be offered the terms of the IFA after they have commenced employment. If you currently use a Lawfield employment contract that incorporates an IFA, please let us know so that we can provide you with an updated document pack that complies with this change.

If you have used an employment contract that incorporates an IFA for a new worker that commenced their employment with you after 4 December 2013, you should ensure that those workers sign and date a new IFA as soon as possible to comply with this change. However it is important that you remember that if a worker does not want to sign an IFA, then you cannot force them to do so and will need to start paying them any Award entitlements that were varied by the previous IFA.

The amendment to the Awards is some additional wording in the flexibility clause that states “An agreement under this clause can only be entered into after the individual employee has commenced employment with the employer.” The Fair Work Commission’s logic behind this change is to attempt to reduce the possibility of workers being coerced into signing an IFA, or doing so under duress and to ensure that the worker has genuinely made the agreement rather than only agreeing to it so that they do not damage their prospects of getting the job.

There are a few different strategies that can we can discuss with you. Please contact us if you are concerned.

While all of this is likely to cause additional administrative challenges for employers, it is important that you ensure compliance with this change otherwise you could risk penalties under the Fair Work Act of up to $51,000 per contravention of the Act for a corporation or $10,200 for an individual.

The time for terminating IFAs has also been extended from 4 weeks, to 13 weeks, unless agreed in writing by the employer and worker.

If you have any questions about how this impacts your existing employment contracts or would like a more detailed explanation of your legal obligations, please contact Ryan Martin on 9215 7500.

Employment Law Update – Fair Work Decisions

In a follow up to our recent update about the importance of implementing workplace policies, below are a few recent decisions that demonstrate the benefits of having workplace policies. If you have any questions or would like to discuss workplace policies further, please contact Ryan Martin at rmartin@lawfield.com.au or on 9215 7500.

One Fair Work decision that demonstrates how important a workplace policy can be in effectively managing workers and implementing procedures is Sparks v MSS Security. In this case a worker (who was part of an airport baggage screening team) stated to his employer that he would not comply with a company policy that required him to telephone his employer and await a replacement before taking a toilet break MSS Security terminated his employment and Mr Sparks brought an unfair dismissal claim. The Commission held that while one breach of the policy would not give rise to a reason for dismissal, the worker’s blanket statement that he would not ever comply with the policy constituted a failure to follow a reasonable and lawful direction of the employer and the Commission upheld the dismissal.

In Pearson v Linfox, Mr Pearson was terminated by Linfox for not following policies and procedures in place at the Distribution Centre he worked at which includied breaches of the mobile phone policy, social media policy, absence from work policy and safety policy. Mr Pearson argued that even though he was aware of these policies, he had been unfairly dismissed as his behaviour could be explained on each occasion. When the Commission examined Mr Pearson’s behaviour it was held that even though his conduct may not have justified dismissal in isolation, his overall conduct involved a consistent pattern of behaviour that demonstrated a repeated disregard for and refusal to comply with the policies and procedures Linfox had in place and constituted a valid reason for termination.

In the Fair Work decision of Chew & Leong v Qantas, Mr Chew and Ms Leong were both flight attendants, and long standing workers who were terminated by Qantas. They were dismissed for failing to comply with the company “Standards of Conduct Policy” and “Fastcard Policy” and which governs how workers are to use their cabcharge cards. The Commission found that while Mr Chew and Ms Leong had failed to comply with the Fastcard Policy, there was no evidence to suggest that either had signed or even sighted the Fastcard Policy and that there was also no evidence of an educational program provided to flight attendants on the use of the cards or the travel policy generally. Both workers were reinstated.

So as these cases demonstrate, it is vital to employers who want to minimise their exposure to unfair dismissal claims to have up to date, effective workplace policies that allow the employer to implement the procedures it requires and to promote the workplace culture it wants. But don’t forget that it is just as critical to ensure that these documents don’t just sit in an office somewhere and that all workers receive adequate training and understand the policies and why they are in place otherwise they will do little to assist an employer.

Should you have any questions or comments, please contact us to discuss.

Employment Law Update – Richardson v Oracle Corporation Australia Pty Ltd

It is an unfortunate fact that the relationship between workers and employers is not always harmonious. Having workplace policies and procedures in place that encapsulate the workplace culture you are trying to create and that assist with the management of proper workplace practices can help to prevent employers becoming involved in unnecessary disputes including costly and time consuming litigation. If you would like Lawfield to assist by drafting a set of workplace policies for you, please contact Ryan Martin on 9215 7500 or at rmartin@lawfield.com.au to discuss.

In the recent case of Richardson v Oracle Corporation Australia Pty Ltd, the full court of the Federal Court ordered an increase in compensation payable to a worker (Ms Richardson) who had been sexually harassed by a co-worker (Mr Tucker) from $18,000 (ordered by the Federal Court in February 2013) to an amount of $130,000 – and the employer (Oracle) was held to be vicariously liable for that amount.

In the original decision, the Court held that Oracle did not do enough to ensure that Ms Richardson was not subjected to the on-going sexual harassment of a co-worker during her employment. Justice Buchannan examined nearly a dozen separate instances that demonstrated an obvious pattern of conduct from Mr Tucker and that Oracle failed to take reasonable steps to prevent the sexual harassment from occurring. Some of Oracle’s workplace management errors included:

  • forcing Ms Richardson to make a formal complaint against her wishes;
  • mishandling the investigation into the harassment complaint;
  • forcing Ms Richardson to continue working with Mr Tucker during the investigation; and
  • effectively demoting Ms Richardson by withholding her from projects that would have ordinarily been within her sphere or responsibility after the investigation was completed.

All of which resulted in Ms Richardson suffering physical and psychological harm, ultimately resigning from Oracle and taking a lower paying position that was held to be an economic loss.

Oracle had a workplace policy in place for dealing with harassment and conducted training with staff members every two years, however these issues were still not dealt with appropriately. Justice Buchannan concluded that the procedures and training as well as the policy itself were largely superficial and inadequate. The Court found that Oracle had not done enough to ensure that all workers understood the policy and did little to assist with the management of proper workplace practices. This appeal decision increasing the damages reflects the strong community expectations for employers to make certain that workers are able to attend a workplace free from sexual harassment.

More adequate policies and procedures could have guided workers, HR personnel and management to ensure that the investigation was handled correctly.

With well articulated policies in place and practical procedures and adequate training to implement those policies, employers can create a workplace culture free from harassment, rather than just ticking boxes.

Should you have any questions or comments, please contact us to discuss.

Employment Law Update

There have been an increasing number of stop bullying applications made in the last few months. Although most have been dismissed for:

  • Improper lodgement by the applicant;
  • Lack of jurisdiction of the Commission;
  • Lack of any reasonable prospect of success because the applicant is no longer employed by the employer; or
  • The behaviour being complained of being found to be reasonable management action taken by the employer,

it is important to note that workers are becoming increasingly aware of these new laws that do not require them to attempt to resolve the issue internally before making an application to Fair Work.

There has been one instance in Applicant v Respondent [2014] FWC AB2014/1052 (the names of the parties were withheld) where the application was upheld and the Commission made stop bullying orders that were very specific. The Commission made several orders including directing the worker who had been bullying the applicant:

  • To complete any exercise at the employer’s premises before 8am.
  • Not to have any contact with the applicant alone and not to make any comment about the applicant’s clothes or appearance.
  • Not to send emails or texts to the applicant, except in an emergency.
  • Not to raise any work issues with the applicant without first running them past the employer’s chief operating officer or his subordinate beforehand.

The worker who brought the application was ordered:

  • Not to  arrive at work before 8.15am.

These types of orders could have a serious impact on a small or medium sized business and be very disruptive to the workplace. So it is very important that you ensure that you have adequate workplace policies in place. It is also important that you have trained your staff appropriately in order to reduce the likelihood of workplace bullying occurring and be in a position to react quickly if it does so that the risk of a worker bringing a stop bullying application is also reduced.

Because as you will see below, even if a claim does not succeed, as long as the worker reasonably believes that they have been bullied, they are entitled to make an application for a stop bullying order.

FWC 3288

In this application the applicant was employed by the Western Australian Department of Education, which meant that it was not a “constitutional corporation”, and outside of the jurisdiction of a bullying claim. So the application was discontinued by the applicant. Sole traders, partnerships and other entities that are not a corporation would also fall outside of the jurisdiction of this law.

FWC 3408

Here an application was made by a worker who was terminated from his employment shortly after the application was lodged. The employer argued that because the worker was no longer a worker, then there was no risk of the bullying continuing, so the application should be dismissed. The Commission agreed, stating that it can only make orders if there is a risk that the bullying will continue. So because here there was no risk of bullying continuing in the workplace, then the Commission accepted it had no power to make orders and dismissed the application.

Importantly, however the applicant also had an adverse action claim on foot and if the applicant got his job back as a result and still had concerns about bullying continuing when he returned, then the applicant was given permission to re-apply to the Commission for a stop bullying order.

FWC 3852

This decision was similar to FWC 3408, where the Commission held that it did not have the power to consider an application because the worker had been terminated so there was no risk of the bullying continuing at the workplace and requested that the applicant file a notice of discontinuance.

FWC 3839

In this application, a worker complained that performance appraisals conducted by his employer and directions from his employer to perform work that the applicant did not believe he was qualified to do amounted to bullying under the Act.

The Commission examined the circumstances and concluded that the behaviour in question was management action. The Commission applied the objective tests to the management action and found that the management action had been reasonable and that it had been carried out in a reasonable manner. As such the behaviour was not bullying for the purposes of the Act and the application was dismissed.

FWC 3151, FWC 3759 and FWC 3761

In all of these applications, the applicant failed to properly complete the correct form (F72) or pay the required filing fee ($65.50). In each case the Commission contacted the applicants multiple times giving them to opportunity to remedy their mistakes, but when they failed to do so, the applications were dismissed.

Should you have any questions or comments about this area of the law, please contact Ryan Martin on 9215 7500 or at rmartin@lawfield.com.au

Employment Law Update

There have been a few developments and cases in recent weeks that we wanted to bring to your attention as they may have an impact on your existing employees’ entitlements.

1 July 2014 changes

The Fair Work Commission this week announced that the high income threshold for employees will rise to $133,000 on 1 July. Employees who earn more than the high income threshold and who are not covered by a modern award or enterprise agreement, are excluded from making an unfair dismissal claim. The high income threshold includes wages, any money paid on an employee’s behalf and any agreed value of non-monetary benefits like laptops and mobile phones. However things like superannuation, commissions, bonuses and overtime are not.

This rise means that you should ensure that any employees who have agreed to a written guarantee of annual earnings in lieu of modern award entitlements under the previous threshold (which was $129,300) are still above the new threshold. If you have any employees who are now below the new threshold they may be eligible for entitlements under the relevant modern award.

The Fair Work Commission also announced an increase to the award minimum wages of 3% meaning the new national minimum wage will be $640.90 per week, or $16.87 per hour. Fair Work will now determine how this effects each award. This means that if you have any employees currently paid at the minimum rate under an award, you should conduct a pay review prior to 1 July to ensure you are not caught out by accidently underpaying any staff.

The statutory requirement for employer’s contributions to superannuation will increase by 0.25% to 9.5% and the compensation limit under unfair dismissal will also rise from $64,650 to $66,500 (or the equivalent of 6 months’ wages, whichever is less) from 1 July

If you are unsure if any of these changes will impact on your business, please contact Ryan Martin on 9215 7500 or at rmartin@lawfield.com.au.

Case highlighting the importance of correct dismissal procedures

In the recent case of Burns v Sacred Heart Mission [2014] FWC 3188, the Fair Work Commission found in favour of an employer in an unfair dismissal claim because the employer had correctly followed the lawful dismissal procedures.

The worker had been directed by the employer to attend certain meetings several times, and in each case the worker failed to attend the meetings or to give a reasonable explanation for the failure. The employer wrote to the worker on each occasion clearly setting out what the worker had failed to do and what the consequences would be if the worker continued to ignore the employer’s directions. The employer gave the worker several opportunities to respond and explain the worker’s actions before ultimately terminating the worker for failing to comply with the directions.

The Commission noted that the employer had taken all reasonable steps to ensure that the worker had been aware of what was required of them and what the consequences would be if they failed to comply with those requirements. Further the employer had given the worker many chances to explain their actions and held that in light of all the circumstances, the employer had acted lawfully, reasonably and fairly and dismissed the unfair dismissal claim.

This case demonstrates the benefits of making directions to workers very clear as well as warning them of the possible consequences if they fail to follow those directions. Even though these procedures can be frustrating and take longer, following them carefully and keeping records of any communications with workers can go a long way toward defeating an unfair dismissal claim.

If you have any issues with workers that you need advice on or have any questions about this area of the law generally, please contact Ryan Martin on 9215 7500 or at rmartin@lawfield.com.au.

Workplace Bullying Laws

The Fair Work Commission made its first significant decision on the new workplace bullying laws earlier this month. The case is Ms SB [2014] FWC 2104 and essentially an application for a stop bullying order was dismissed because while the conduct complained of bordered on unreasonable behavior, was not sufficient enough to satisfy the statutory definition that the behavior would create a risk to the applicant’s health and safety. The decision also considered what constitutes ‘reasonable management action’ for the purposes of a bullying claim.

Section 789FD of the Fair Work Act allows a worker who “reasonably believes” that they have been bullied at work to make an application for an order to stop bullying. This is a risk to employers who do not have effective workplace management systems in place because even though this application was dismissed, the employer was still required to go through the Fair Work process and incur legal costs to defend the claim which may have been avoided if the situation had been managed better internally.

For the purposes of the Act bullying is repeated behavior by an individual or group that is unreasonable toward the worker that creates a risk to health and safety. There is an exception to this where the alleged bullying is reasonable management action being carried out in a reasonable manner which was included in the Act to allow for the need for managers to be able to manage their staff.

Ms SB alleged that bullying from another employee (Ms CC) had occurred and that the employer had not provided appropriate management support to prevent it. The allegations included that both Ms CC and another employee had made internal bullying complaints against Ms SB to the employer. Ms SB complained that the complaints were accepted for investigation by her employer and that following the favourable outcome for Ms SB in relation to those complaints that the employer did not take adequate action to prevent similar inappropriate conduct from occurring again (i.e. preventing baseless claims being made against her).

Ms SB complained that she was harassed by Ms CC on a daily basis and that she had been the target of malicious rumours in the workplace spread by Ms CC and others. Ms SB said that she had received no support from her employer and that a failure of her employer to  notify other employees of the outcome of the complaints made by Ms CC and the other employee had led to Ms SB being humiliated as a consequence of rumours and gossip about the situation.

Ms SB contended that unless appropriate action was taken, she would continue to be bullied at work by Ms CC.

The investigations carried out by the employer into the complaints made by Ms CC and the other employee were carried out by an external legal firm and the employer relied on legal professional privilege and did not submit a full report or evidence about how the investigations were conducted.

The FWC considered what constitutes bullying behavior under the Act. The concept of individuals repeatedly behaving unreasonably implies the existence of persistent, unreasonable behavior and that there is no specific number of incidents required, nor does the behavior have to be the same specific behavior, but the behavior must be unreasonable and must happen more than once. Whether behavior is unreasonable is an objective test having regard to all the circumstances. That unreasonable behavior must be of a nature that will create a risk to health and safety and the risk must be real and not just conceptual. If all of these elements are present, when considered objectively, then bullying has occurred for the purposes of the Act.

The FWC then considered that would be reasonable management action for the purposes of the Act and said that the provision comprises of three elements:

  • The behavior (being relied upon as bullying conduct) must be management action;
  • It must be reasonable for the management action to have been taken; and
  • The management action must have been carried out in a manner that is reasonable.

When determining whether management action has been carried out in a manner that is reasonable was also an objective test, considering the circumstances that led to the need for management action to be taken, the circumstances while the management action was being taken and any consequences that flowed from the management action being taken. It was also said that the test was not whether the management action could have been undertaken in a ‘more reasonable’ manner, just that the management action needed to be reasonable.

When examining the circumstances of Ms SB’s bullying claim objectively, the FWC applied these tests and was not convinced that the behavior constituted bullying for the purposes of the Act. The FWC accepted that the making of vexatious allegations against a worker, spreading rude an inaccurate rumours about an individual and conducting an investigation in a grossly unfair manner are capable of being considered as unreasonable conduct as contemplated by the Act, it would depend on the nature and actual conduct in the context. The FWC said that it could not be satisfied that the limited degree of unreasonable behavior by the individuals concerned was such that it created a risk to health and safety. The FWC also stated that the employer’s decision to engage an external legal firm to carry out the investigation of complaints made by Ms CC and other employees was not unreasonable.

The FWC found that Ms SB had not been bullied at work within the meaning of s789FD and dismissed the application.

Importantly, the FWC also pointed out that the applicant had not acted vexatiously in bringing the application and that while not persuaded that the behavior constituted bullying within the meaning of the Act, the application was not made without foundation and advised that there were some cultural, communication and management issues in the workplace that needed to be addressed by senior management.

This is a good reminder that employers need to ensure that they have solid anti-bullying policies and guidelines as well as adequate workplace investigation, dispute resolution and disciplinary action procedures in place.

If you have any questions or comments about this area of the law, or would like Lawfield to assist you by helping you to set up effective workplace management systems including a workplace bullying policy or to review your existing workplace documents and systems, please contact Ryan Martin on 9215 7500 or at rmartin@lawfield.com.au to discuss.

Personal Property Securities Update

There have been several developments in regard to the Personal Property Securities Act 2009 (“PPSA”) which are important for small to medium sized business and suggests that many businesses are still being caught out and coming off second best when there is a competing claim under the PPSA.

Below is a recent decision of the Supreme Court of Western Australia which emphasises the need to properly register security interests, particularly now that the transition period has come to an end. In addition, a Bill was recently introduced to Parliament that will assist with reducing some risk to small businesses under the PPSA if it is passed and the Government has also announced a review of the operation of the PPSA with a focus on its impact on small businesses.

White v Spiers Earthworks Pty Ltd

In this decision, Spiers Earthworks Pty Ltd (“Spiers”) agreed to sell their earthmoving business to BEM Equipment (“BEM”) in 2010 and also entered into a hire purchase agreement with BEM for vehicles and other equipment valued at over $1million (“Hire Assets”).

In 2011, BEM granted a fixed and floating charge to the NAB as security for amounts owed to the NAB by BEM. Shortly after BEM entered into voluntary administration in 2013, the NAB appointed receivers and managers to BEM in accordance with that charge.

The Court held that the hire purchase agreement entered into in 2010 constituted a PPS Lease. Because Spiers had not registered an interest over the Hire Assets on the Personal Property Securities Register or under the Chattel Securities Act prior to the commencement of the PPSA in 2012, Spiers lost their interest in the Hire Assets when it was vested in BEM immediately before the appointment of the administrators pursuant to s267 of the PPSA. So despite being owner of the Hire Assets, Spiers failure to register it’s interest meant that it was defeated.

The decision is another reminder of the importance of registration of security interest which is of particular significance now that the transitional period has come to an end. Now that the transitional period has ended, any unregistered interest is likely to be defeated by a superior competing interest. So if you think you may have a registrable interest, or have valuable goods on loan or hire to another company or person and are concerned whether that may constitute a PPS Lease that required registration, please contact us to discuss.

Proposed amendments to the PPSA

As mentioned, a Bill has been proposed to Parliament, which if passed means that the provision under the PPSA that deems a lease or bailment of goods with a serial number (such as motor vehicles, boats and aircraft) to be a PPS Lease where the term of the lease is 90 days or more will be removed. This means that leases or bailment of serial numbered goods than are 90 or more days but less than 12 months, will no longer constitute a PPS Lease and will no longer require registration.

While this amendment will be helpful in reducing the risk for businesses who hire out goods and equipment, it will only apply to transactions that occur after the commencement of the amendment, so it is still important to ensure that you continue to register any lease or bailment of serial numbered goods that is 90 days or more until the amendment is passed.

Review of the PPSA

The Government has announced a review of the PPSA, with an interim report due by 31 July 2014 that will focus on issues raised in relation to small businesses. The final report will be due on 30 January 2015.

The Government stated that the review should consider:

a)    the effects of the reforms introduced by the PPS Act on:
i.       Australian businesses, particularly small business
ii.      Australian consumers
iii.     the market for business finance in Australia, and
iv.     the market for consumer finance in Australia
b)    the level of awareness and understanding of the PPS Act at all levels of business, particularly small business
c)    the incidence and, where applicable, causes of non-compliance with the requirements of the PPS Act particularly among small businesses
d)    opportunities for minimising regulatory and administrative burdens, including costs, on businesses, particularly small business, and consumers
e)    opportunities for further efficiencies in the PPS Act regime including (but not limited to) simplification of the Personal Property Securities Register and its use
f)     the scope and definitions of personal property covered by the PPS Act
g)     the desirability of specifying thresholds for the operation of the PPS Act regime in respect of particular types of personal property
h)    the interaction of the PPS Act with other legislation including the Corporations Act 2001, and
i)     any other relevant matters.

So in summary, it appears that the Government has realised that many small to medium businesses are struggling to keep up with the effects of the PPSA. If you would like us to pay you a visit to go through the concepts of the PPSA and how it impacts on your business, please contact Ryan Martin on 9215 7500 or at rmartin@lawfield.com.au and we can arrange a time to come and visit you.

Changes to the Privacy Act

On 12 March 2014 some important amendments to the Privacy Act 1988 (Cth) will come into effect. Along with these amendments there will be a new unified set of Australian Privacy Principles (replacing the National Privacy Principles) that will apply to both the private and the Commonwealth public sector.

Under the Privacy Act an “APP Entity” will include entities such as companies, unincorporated associations and partnerships with an annual turnover of $3 million or higher and agencies or bodies established for a purpose under Commonwealth legislation.

The new Privacy Principles will include key changes such as:

  • A new requirement for entities to include additional information in any privacy collection documents or privacy policies;
  • More restraint placed on offshore data storage and processing activities (including things like overseas Cloud service providers); and
  • Tighter controls on the use of personal information for direct marketing.

There are many other changes and you will need to ensure that any current documents that are subject to the Privacy Act or the existing National Privacy Principles are updated.

There will also be increased powers for the Privacy Commissioner and changes to the credit reporting provisions of the Privacy Act.

All of these changes will be important to how you manage the personal information about employees, customers, clients or other individuals. So you will need to think about whether your current documentation is affected, including things like credit applications.

A failure to comply with the changes may result in significant penalties including court orders and fines up to an amount of $1.7 million for an APP Entity and up to $340,000 for an individual. So it is very important that you address these changes by considering whether you need to:

  • Review and update existing privacy policies;
  • Implement a privacy compliance program that includes procedures for management of personal information about individuals;
  • Review and update existing credit applications;
  • Review any offshore data storage or processing activities;
  • Review any direct marketing practices; and
  • Provide any additional information to individuals when collecting personal information.

If you have a privacy policy, credit application form or any other document that relates to the Privacy Act that you would like Lawfield to review to ensure compliance; or you would like Lawfield’s assistance to review how you currently collect personal information and help to formulate a privacy compliance program, or would like any additional information about these changes please contact Ryan Martin on 9215 7500 to discuss.