See Fair Work Act s.411
Employer response action for a proposed enterprise agreement means industrial action that:
Employer response action must be in response to industrial action, as defined, that is happening. Employer response action cannot, by definition, be in response to industrial action that is threatened, impending, probable or even imminent at the time that the employer's industrial action is implemented.
As defined, the only form of employer response action is a lockout.
An employer may also take other action, which is not 'employer response action', in response to employee claim action. This other action can include:
In Australian and International Pilots Association v Fair Work Australia the Full Court of the Federal Court considered whether there needed to be a link between employer response action and industrial action taken by employees. The Court found that the terms of the Fair Work Act limit an employer to some form of causally connected response to employee industrial action.
The words 'as a response' require only that the lockout be seen as causally connected to employees' industrial action. It does not have to be reasonable, proportionate or rational.
A causal connection is the relation of cause and effect.
In this context the ‘cause’ is the employee industrial action and the 'effect' is the employer response action.
Employer response action can be protected industrial action if it is engaged in in accordance with s.411 of the Fair Work Act in response to employee industrial action which is or is not protected action.
If an employer engages in employer response action against employees, the employer may refuse to make payments to the employees in relation to the period of the action.
An employer may lockout its employees and refuse to pay them in order to support or advance the employer’s claims during bargaining in relation to a proposed enterprise agreement.
Employers have various statutory and common law rights to respond to industrial action by employees and such responses will not constitute industrial action unless the employer’s action is a lockout. For example, in particular circumstances an employer may have the right to respond to industrial action by:
Employer response action for a proposed enterprise agreement does not affect the continuity of employment of the employees who will be covered by the proposed enterprise agreement.
The Fair Work Regulations set out purposes for which continuity of employment is not affected by an employer taking industrial action. These are:
This means that an employee’s period of employment with an employer is not broken by the employer engaging in industrial action.
For instance, if an employer locks out its employees for one day each week, the employees are still considered to be employees for the purposes of things like superannuation even though the employees may not be getting paid. The employees’ employment does not stop when the employer takes industrial action and then start again after the industrial action has finished.
An employee remains employed regardless of the industrial action taking place.
There is no entitlement to annual leave (a NES entitlement) for the lockout period when the industrial action is valid employer response action under the Fair Work Act. The entitlement to annual leave in s.87 is for ‘service’. A period of lockout does not count as employee ‘service’ by reason of s.22(2)(b).
(2) [Exceptions to meaning of service]
The following periods do not count as service:
(b) any period of unpaid leave or unpaid authorised absence other than;
(i) a period of absence under Division 8 of Part 2-2 (which deals with community service leave); or
(ii) a period of stand down under Part 3-5, under an Enterprise Agreement that applies to the employee, or under the employee’s contract of employment; or
(iii) a period of leave or absence of a kind prescribed by the regulations;
 Australasian Meat Industry Employees Union, The v JBS Australia Pty Ltd  FWC 2254 (Bartel DP, 4 April 2014) at para 20.
 Fair Work Act s.19(1)(d).
 United Voice v MSS Security Services Pty Ltd  FWC 4087 (Cloghan C, 27 June 2013) at para. 56.
 Australian and International Pilots Association v Fair Work Australia  FCAFC 65 (10 May 2012) at para. 155.
 Butterworths Australian Legal Dictionary, 1997, at p. 172.
 Construction, Forestry, Mining and Energy Union v Bechtel Construction (Australia) Pty Ltd and another  FWCFB 8490 (Catanzariti VP, Richards SDP, Booth C, 15 December 2015) at para. 14; citing Australian and International Pilots Association v Fair Work Australia  FCAFC 65 (10 May 2012) at para. 24, [(2012) 202 FCR 200].
 Fair Work Act s.416.
 Fair Work Act s.416A.
 Fair Work Regulations r.3.09.
 Construction, Forestry, Mining and Energy Union and Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia v Carter Holt Harvey Woodproducts Australia Pty Ltd T/A Carter Holt Harvey  FWC 6 (Gostencnik DP, 16 January 2018); upheld on appeal  FWCFB 2731 (Hamberger SDP, Colman DP, Harper-Greenwell C, 15 May 2018).
 Fair Work Act s.22(2)(b).