• Employment Contracts
  • The Bill seeks to amend s 44(2) the Local Government Act 2020 (Vic) (LG Act) dealing with employment of CEOs by providing that a CEO must be appointed under a contract of employment with the Council that contains any prescribed clauses and addresses prescribed matters. 
     
  • Provision is then made for new regulations which we expect will be more prescriptive than the current s 44 requirements – with a standard form contract and/or prescribed clauses and matters such as requirements for appointment and re-appointment being contemplated in the Bill.
     
  • The existing maximum term of 5 years will continue to apply. 
     
  • Confirming the consequence non-compliance, the Bill provides that a contract which does not comply with the 5-year maximum term or omits any prescribed clauses or matters is void. 
• CEO Employment and Remuneration Policy
  • Under the CEO Employment and Remuneration Policy, a new CEO Employment Matters Committee must be established within 12 months of the new provisions commencing, to provide independent and professional advice to the Council about CEO employment and remuneration matters. The Chair of the CEO Employment Matters Committee must be independent, and the Committee will not be a delegated Committee.
     
  • This replaces the existing obligation in s 45(2)(a) of the LG Act, requiring that the CEO Employment and Remuneration Policy provide for each Council to obtain independent professional advice.
     
  • Although the degree of independent input into CEO employment may not change significantly under the Bill, a more robust framework will be required to support this. 

Fair Jobs Code 

• Content
  • A Fair Jobs Code may (and will likely) be prescribed by the regulations (which are yet to be circulated). 
     
  • The Bill does not address the content of the Fair Jobs Code, other than to say its purpose will be provide a robust framework for secure work practises. 
• CEO Compliance
  • Council CEOs must comply with any requirements in the Fair Jobs Code, unless an exemption applies (to be confirmed in the regulations). 
     
  • CEOs must complete a compliance assessment each financial year and provide this to the Fair Jobs Code Regulator (FJC Regulator). CEOs cannot delegate this duty.
• Local Government Fair Jobs Code Regulator

  Once appointed, the FJC Regulator will be responsible for:

  • monitoring and assessing CEO compliance (of their own initiative or on receipt of a complaint or compliance assessment); 
     
  • reporting to the Minister in relation to compliance by CEOs; 
     
  • publishing reports and providing guidance and education to Councils and CEOs on the obligations under the Fair Jobs Code; and
     
  • referring suspected breaches of the LG Act by CEOs (other than Fair Jobs Code compliance) to the Chief Municipal Inspector or to the particular Council.
• Enforcement, Review and Reporting
  • If the FJC Regulator has reasonable grounds to believe a CEO is not complying with the Fair Jobs Code, steps can be taken to notify and investigate suspected non-compliance, before issuing a decision. Where non-compliance is found, the decision will be made public.
     
  • The Bill does not empower the FJC Regulator to impose any direct consequences on CEOs for non-compliance. In practical terms, it will be up to each Council to decide what, if any, consequences flow from a CEO’s non-compliance with the Fair Jobs Code, through the CEO employment framework.
     
  • The FJC Regulator must prepare annual reports on each CEO’s compliance with the Fair Jobs Code, to be published online. 
     
  • The Fair Jobs Code will be reviewed every 5 years and a report of each review tabled before Parliament. 

What should Councils do now?

The Bill provides the framework, but not yet the detail, in relation to changes to CEO employment matters and the Fair Jobs Code.

Councils should ready themselves to set up a new CEO Employment Matters Committee and to revisit contracts of employment to ensure compliance with new regulations. Remember, a contract that doesn’t comply will be void by operation of law. 

In due course, Councils will also need to update their complaints policies under s 107 of the LG Act to include the process for referring complaints relating to the Fair Jobs Code to the FJC Regulator.

In terms of the Fair Jobs Code, the real work will be required once the content is known and CEOs can start planning for any changes required to existing recruitment, employment, tendering and outsourcing practices.