425 Words of Wisdom

Observations on Section 106

Imagine you have been working in the same company for 20 years. You have worked unpaid overtime for at least 5 hours a week. You have developed a strong competency in your field and have worked with a range of managers, colleagues and subordinates.

Then after all this, a new owner takes over the company. There is a restructure. You are given your marching orders. You might be made to feel so uncomfortable that you will want to resign. You might be offered a fairly ordinary redundancy package.

What should you do? Who can you turn to? What remedies does the law provide to you?

One option is to claim that your employer breached its employment contract with you. It will be necessary for you to prove exactly what the contract is, how it was breached, what damages you have suffered and how these damages are connected to the breach. A tall order.

You might decide to try and claim just for the unpaid overtime. But how do you calculate it? And what records do you have of the time you worked there? Did you keep a diary for all those years? Did you work this overtime knowing that one day you might make a claim?

For long-term workers who get shafted, perhaps the best remedy is provided by Section 106 of the Industrial Relations Act. This particular remedy is broad, flexible and grants the NSW Industrial Relations Commission broad powers to remedy an unfair situation.

The unfair contracts jurisdiction has grown dramatically since it was introduced in 1959. Back then, it was used to protect the terms and conditions of contractors such as milk vendors and construction industry workers and tradesmen. Today, it is used as a general purpose remedy for a range of employment situations. In 2000-01, some 26% of the NSW Industrial Relations Commission workload was taken up with s106 matters.

Similar legislation also exists in Queensland. There are also similar provisions in the Commonwealth Workplace Relations Act, though these are somewhat more limited.

In NSW, you have to bring your claim within 12 months of your contract being terminated. This is a strict time limit and cannot be extended by the Commission. SO if you think you have been treated unfairly by your employer, the time to act is now.

The Howard Government is hoping to replace state industrial relations systems with a single federal system. This could spell the end of unfair contract claims. You therefore must act now if you think you have a claim.