KNOWLEDGE CENTRE

Building Industry Fairness of Payments Act Amendments and Registration of Charges

Provisions of the Building Industry Fairness (Security of Payment) and Other Legislation Amendment Act 2020 (Qld) (the Act) will take effect on 1 October 2020, introducing significant payment security reforms.

In particular, the Act introduces a new remedy for head contractors that have not been paid an adjudication debt by a principal/client following the filing of an adjudication certificate. This remedy allows a head contractor to request a charge over the property on which construction work was carried out where:

  • the construction work or related goods and services relate to the adjudicated amount; and
  • the principal/client, or a related entity, is the registered owner of the property.

Importantly, this charge is lodged with the registrar of titles and is to exist for 24 months after registration unless discharged, set aside, or the adjudicated amount is paid.

Additionally, a head contractor is able to enforce the charge by application to the Court for orders that the property is sold, which will authorise the sale of the property free of all encumbrances and will have effect regardless of any encumbrances. The Act defines ‘encumbrance’ to mean:

  • a mortgage, lien or charge over the property;
  • a caveat claiming interest over the property by way of security; or
  • a writ affecting the property.

This mechanism means that a head contractor is able to apply to have the property sold, even if there are prior encumbrances.

On settlement of sale of property ordered by the Court, sale proceeds would be applied in the following order:

  • first – payment of sale costs and the head contractor’s costs in seeking the sale;
  • second – payment of amounts to satisfy any registered encumbrances, including the charge registered by the head contractor, in the priority order under the Land Title Act 1994 (Qld); and
  • third – payment of any balance to the registered over of the relevant property or to another at the discretion of the owner.

This is a very powerful tool available to head contractors because it provides them with practical, relatively straightforward and economical leverage to force compliance by principals/clients or risk serious ramifications that typically otherwise only eventuates in very limited circumstances.

To avoid any charges being registered and enforced, principals/clients should ensure that any adjudication amounts are paid as a matter of priority. Under the Act, payment must be made 5 business days after the adjudicator’s decision, or a later date if decided by the adjudicator, so it is important that principals act quickly to prevent the registration and enforcement of potential charges.

 

Need further clarification? Enterprise Legal are Toowoomba's construction law experts - make a time to see us today:

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Reduction in Employee’s Hours = Redundancy Pay?

The recent decision in Broadlex Services Pty Ltd v United Workers’ Union [2020] FCA 867 highlights the risks employers will face if they reduce the hours of their employees without consent.

Broadlex, a cleaning company, experienced a downturn in business which triggered it to advise full-time employee, Ms Vrtovski, that her employment status would be reduced from full-time to part-time, reducing her hours from 38 hours per week to 20 hours per week (with a proportionate reduction in salary).  

Ms Vrtovski declined to sign a form consenting to the change but nevertheless worked the reduced hours as she felt she had no choice. She later filed a dispute and upon examination, Justice Katzmann of the Federal Court of Australia held that Ms Vrtovski was entitled to redundancy pay on the grounds that:

1. Section 119 of the Fair Work Act 2009 (Cth) confirms that a redundancy requires:

  • the employee’s employment to be terminated
  • the termination to be done at the employer’s initiative because it no longer requires the job to be done by anyone.

2. by reducing Ms Vrtovski’s hours without consent, Broadlex had repudiated her contract of employment, which was accepted by her when she refused to sign the consent form. This, in turn, had the effect of terminating Ms Vrtovski’s full-time employment and when she commenced working on a part-time basis, she did so under a new contract of employment;

3. as the termination of Ms Vrtovski’s employment was initiated by Broadlex (when they changed her employment to part-time), who did not require her full-time role to be done by anyone, Ms Vrtovski’s circumstances met the requirements of section 119 and she was therefore entitled to redundancy pay.

 

Lesson for Employers 

The decision in Broadlex serves as an important reminder that employers need to be very careful when making changes to an employee’s employment.

 

If you find yourself in a situation where you are considering making similar changes within your business, we encourage you to contact EL's Principal Legal Advisor – Workplace Relations, Amie Mish-Wills for advice & support:

☎️ (07) 4646 2425

✉️ Submit an Online Request


New Pay Changes for Commission-Only Real Estate Agents

The Fair Work Commission (the Commission) has stepped in to provide support for the real estate industry and commission-only real estate agents who are covered by the Real Estate Industry Award 2020 (the Award), by removing the months of May, June, July, August, September and October 2020 from the calculation of Minimum Income Threshold Amount (MITA) for the preceding 12-month period.

The MITA will be subsequently adjusted in proportion to the number of months disregarded, provided that, where the commission-only employee’s review date falls partway through any COVID-19 month, that month may only be disregarded where the review is due after the 14th of the month.

The Commission has also amended the Award to suspend the eligibility for the engagement of further commission-only agents for the period 6 August 2020 to 1 November 2020. Specifically, the Award has been amended to state:

“An employee who is not employed as a commission-only salesperson as at 6 August 2020, shall not be eligible to be employed on a commission-only basis prior to 1 November 2020.”

The aforementioned changes are in operation from the 6th of August 2020, however, for those recently employed, they do not take effect until the start of the employee’s first full pay period that starts on or after 6 August 2020.

You can read the Commission's decision on The Treasury's website.


Changes to JobKeeper

The recent changes to JobKeeper announced on the 7th of August 2020 will also provide an element of reprieve for some, with businesses now only needing to demonstrate that their GST turnover has fallen in one quarter, instead of two, in order to qualify for the recently extended scheme.

Instead of the requirement to demonstrate a decline in turnover for both the June and September quarters, the 7th of August 2020 announcement confirms businesses will now only need to show that GST turnover has fallen in the September quarter, compared to the corresponding period in 2019.

Employee eligibility and payments have also changed, to the extent that the scheme has been amended to cover those who have been working since at least 1 July 2020, instead of the original deadline of 1 March 2020. The payment rate will also drop from October to $1,500 to $1,200 for full-time workers, and to $750 for part-time workers, before dropping again in January to  $1,000 per fortnight for full-time workers and $650 for part-time workers.

Employers will need to use the two fortnightly pay periods to either 1 March 2020, or 1 July 2020 to calculate JobKeeper payment tiers and if an employee has been eligible for JobKeeper since March 1, the fortnightly period with the highest number of hours worked should be used. 

Click here to read the 7 August 2020 announcement from The Treasury detailing the changes to JobKeeper.


If you have any questions or need any support with your workplace during these times, do not hesitate to contact EL's Principal Legal Advisor – Workplace Relations, Amie Mish-Wills:

☎️ (07) 4646 2425

✉️ Submit an Online Request


Paid Pandemic Leave is Here... For Some

Employees covered by the Nurses Award 2010, Health Professionals and Support Services Award 2020 and Aged Care Award 2010 who are employed by residential aged care providers or are required to work in residential aged care facilities are now entitled to two weeks’ paid pandemic leave following a recent announcement from the Fair Work Commission. 


What is the Entitlement?

Permanent and casual employees engaged on a regular and systematic basis under the aforementioned modern awards are now entitled to take up to two weeks’ paid pandemic leave on each occasion they are prevented from working when:

  • the employee is required to self-isolate or quarantine by government or medical authorities or their employer;
  • the employee is required to self-isolate or quarantine following receipt of medical advice because they are displaying symptoms of COVID-19 or have come into contact with a person suspected of contracting COVID-19;
  • the employee is isolating while they await their tests results;
  • because of measures taken by the government or medical authorities in response to the COVID-19 pandemic. 


Are There Exclusions?

Yes, employees will not be entitled to access paid pandemic leave if:

  • they are not covered by the aforementioned awards;
  • they are able to work from home or remotely;
  • circumstances dictate that they should access personal/carer’s leave (for example, if the employee was actually unwell, they would be entitled to personal leave);
  • they are covered by an Enterprise Bargaining Agreement that does not expressly incorporate the aforementioned awards.
    Importantly, the leave is conditional on employees taking a COVID-19 test at the earliest opportunity. 

Employees requesting pandemic leave are also required to: · provide their employer with notice and the reason why they are taking the leave, as soon as practicable; and if required · provide evidence that would satisfy ‘a reasonable person’ that the leave is being taken for one of the specified reasons; and produce a medical certificate.

Employees are still entitled to workers’ compensation if they test positive for COVID-19 and their paid pandemic leave ceases, provided COVID-19 was contracted during their employment. 


What About Other Industries?

At this point in time it is uncertain whether or not this entitlement will be broadened to other modern awards and employers in other industries are understandably curious and nervous. The Fair Work Commission, in their statement, confirmed that the paid pandemic leave is in response to “The seriousness of the position in the aged care sector”, however time will tell if this will broaden further in the rapid changing times. 

If you have any questions or need any support with your workplace during these times, do not hesitate to contact EL's Principal Legal Advisor – Workplace Relations, Amie Mish-Wills:

☎️ (07) 4646 2425

✉️ Submit an Online Request