Redistributing Work: Methods and Possibilities


Research Paper 26 1995-96

Steve O'Neill
Economics, Commerce and Industrial Relations Group

Contents

Abbreviations

Major Issues

Introduction

Conclusion

Appendix 1 Terminology

Appendix 2 ACTU Codes of Conduct on Twelve Hour Shift Work and Casual and Part Time Work

Appendix 3 European Directive: Working Time

Appendix 4 US Guidelines on Short Term Compensation

Appendix 5 Options for Managing the Workload when Employees take Prolonged Leave:

Appendix 6 ICI Botany: The 'Annualised Salary' Approach For Engineering Technicians (Fitters and Riggers)

Appendix 7 Sheraton Pacific Hotels: The 'Annualised Salary/Loaded Hourly Rate' Approach

Endnotes

Abbreviations

ABS
Australian Bureau of Statistics
ACTU
Australian Council of Trade Union
AIRC
Australian Industrial Relations Commission
APS
Australian Public Service
ARP
Award Restructuring Process
DIR
Department of Industrial Relations
DOL
Department of Labor
EWTD
European Working Time Directive
GDP
Gross Domestic Product
ILO
International Labour Organisation
PPT
Permanent Part-Time
RDO
Rostered-Day Off
SEP
Structural Efficiency Principle
UK
United Kingdom
US
United States
V-Time
Voluntary Reduced Worktime

Major Issues

In a number of countries work redistribution through changes to standard working hours is being investigated as a means to reduce unemployment. Economic growth has not translated into employment growth, an outcome known as the 'jobless recovery'.

However, some countries have performed better than others in generating jobs along with increases in Gross Domestic Product (GDP). On a comparative basis, Australia has performed well in job creation. Although unemployment in Australia has been reduced over the past two years, the fall does not appear to be sustained. Flexible work arrangements potentially offer the scope to share the available work.

If new work arrangements are to benefit employees and perhaps the unemployed, there needs to be a 'decoupling' of workplace hours from those performing it. This means that the operating times of plant and equipment will be separated from the period which any one individual worker spends at work. It is still possible to keep operating times of plant long, or even continuous, while working times of individuals can be reduced. Such working hour arrangements are termed by the OECD few time arrangements Unless decoupling is facilitated in some way, the opportunities for hours flexibility seem less.

One feature of working hours for full-time employees is the increase in the proportion of these who are working 'long' weekly hours. This proportion has increased from under 30 per cent in the mid 1960s to about 43 per cent currently. However there have been other trends in hours worked and the pattern might be best described as dispersion-away from the forty hour week, i.e. both toward longer and shorter hours. Nevertheless, Australians are reporting that they are overworked and often they would prefer lesser hours.

The shift to enterprise bargaining has allowed employers to put the working hours arrangements on the bargaining table. However 'liberated' working arrangements such as job-sharing or working from home are not prevalent, as revealed in a survey of enterprise agreements.

Such trends beg the question: to what extent can current working arrangements be altered to provide more of those without work with work, and lessen the burden on those in work? There have been some specific examples of the alteration to working hours in certain enterprises leading to either a halt on retrenchment or the creation of some jobs.

There is also a bargaining process concerning working time arrangements. Employers seek the removal of restrictions on night, shift and weekend work, as well as on daily maximum hours, while unions typically seek to limit the detrimental affects of working hours flexibility.

The ACTU released guidelines in 1990 on part time work, casual work, job sharing and twelve hour shifts. Enterprise bargaining has enabled experiments with a variety of hours and pay arrangements, with recognised examples being at the ICI Botany chemical plant and the Sheraton Pacific Hotels enterprise agreements.

More recently, the two family Leave Test Case ecisions (1994,1995) have broached the matter of working hours flexibility from the interests of employees, and on an award basis thus reaching more of the workforce. The objective of the union claim was to allow (private sector) employees access some of their current leave entitlements for the purpose of caring for family members. The decisions (affecting federal award employees) have covered other issues pertaining to working hours and for example have sanctioned overtime work being taken as time off rather than as income. Also it was decided that permanent part-time work provisions are to be promoted in the current review of awards under s.150A of the Industrial Relations Act 1988. As well, employees who elect for these shorter hours are to have access to similar benefits as full-time employees such as training.

The European Working Time Directive (EWTD,1993) recognises the concern of European Union countries to set upper limits on time worked so as to allow work redistribution to occur. No similar policy on working time has so far been adopted or canvassed in Australia, yet given the extent of unpaid 'overtime' by the professional classes, government policy on reasonable working hours seems warranted.

The test of the success of work hours redistribution is that it will direct jobs to those unemployed. Detractors of work redistribution cite a potential fall in productivity as quality labour may be replaced by poorer quality labour, or by labour with different (and inadequate) skills and labour on-costs may increase. The unqualified success of work redistribution to reduce unemployment measures therefore cannot be guaranteed and most academic study confirms this. However, giving employees the optionto take increases in productivity in leave rather than income should be recognised as legitimate in a bargaining process and that certain sections of the workforce may pursue this option.

Introduction

What scope is there for work to be redistributed such that unemployment levels might be reduced? This is a question on the agenda of employment policy makers in governments, unions, the Organisation for Cooperation and Economic Development and the International Labour Organisation (ILO).

Using trend statistics, Australia's unemployment level stood at 768 400 in January 1996. Of these, 234 200 had been unemployed for a year or more. Unemployment has been reduced over the past two years. By early 1993 it reached 11 per cent and by mid 1995 it had fallen to 8.3 per cent, although this fall has not been sustained. The Australian Bureau of Statistics (ABS) estimate of the total labour force (January 1996) includes 9.09 million individuals either working or seeking work. In January 1996, employment stood at 8.32 million which is above the last peak of employment reached in 1990 (7.89 million).

The growth in employment seems to have stalled in late 1995: the contribution of the September 1995 quarter to jobs growth was a mere 15 000, and the December quarter added 28 000 jobs. If the rates of unemployment reduction and employment growth have stalled, is there any scope to redistribute the work available? Also, if incomes and GDP are rising while employment growth remains flat, do these trends provide even superficial evidence that we are working harder than we have in the past, and if so, is it possible for work to be redistributed and thus providing work for those without it?

This paper evaluates the options to redistribute work. It discusses:

  • the characteristics of unemployment amid prosperity which has lead academics to term the current phase of recovery as jobless growth
  • the interests of employers, unions and governments in seeking more flexibility in working hours, and the advantages and disadvantages for employers and employees: note that terms such as flextime, job sharing, work sharing, annualised hours and others are explained in Appendix 1
  • the Australian debate flexible work hours which in the late 1980s through the centralised wage system favoured the operating needs of employers but more recently the Family Leave Test Cases have broached the working hours issue from the needs of workers.
  • the paper evaluates some statistics and information on working arrangements:
    • which employees are working long hours
    • the trend of people working 'harder' and thus the scope for work redistribution as well as
    • the role of enterprise agreements in promoting new time arrangements
  • international initiatives to create flexible hours work arrangements and so redistribute employment
  • the counter arguments to work sharing as a method of alleviating unemployment are also considered:
    • that work sharing is a poor approach to solving unemployment and that those who work share do so because of their personal preference, not of an altruistic motive

The Interest in Flexible Work Hours-Jobless Growth

From the perspective of OECD countries, the gravity of unemployment has generated a number of inquiries and possible solutions, particularly within the European Community. Work redistribution is certainly one option under evaluation. The OECD commissioned a number of workshops and studies on options for employment generation. These are reported in a series under the title of the Jobs Study.

The OECD also convened seminars of its (tripartite) Working Party on Industrial Relations in 1993 to evaluate job sharing, work redistribution and working arrangement flexibilities. It commissioned eight national reports (Canada, France, Germany, Italy, Japan, The Netherlands, Sweden and the UK) on flexible hours in three industries: metal manufacturing, the retail trade and health services. A report of these workshops was released by the OECD in 1995 (1).

From these workshops policy makers have observed that economic progress has not uniformly translated into employment—the so-called 'jobless recovery'. The charts in the following pages correlate the growth (or fall) in employment with the growth of output for selected countries. The charts also show that employment generation is not necessarily linked to GDP growth—spectacularly so in the case of France, the UK and Germany. The employment generation effect has been healthy for the US and Japan, with Australia being a better performer on employment generation. These tables are reprinted from the OECD's OECD Societies in Transition, The Future of Work and Leisure (1994). Employment and GDP data for Australia has been prepared by the Parliamentary Research Service.

Chart 1: GDP and employment growth in industrialised countries 1960-87

Chart 1: GDP and employment growth in industrialised countries 1960-87 - France

Chart 1: GDP and employment growth in industrialised countries 1960-87 - Germany

Chart 1: GDP and employment growth in industrialised countries 1960-87 - Japan

Chart 1: GDP and employment growth in industrialised countries 1960-87 - United Kingdom

Chart 1: GDP and employment growth in industrialised countries 1960-87 - United States

(Source: OECD societies in transition, OECD, 1994)

Chart 2: GDP and employment growth in Australia 1960-1987

Chart 2: GDP and employment growth in Australia 1960-1987

(Source: Parliamentary Research Service)

As a response to jobless growth, a number of countries are promoting flexible work arrangements to spread paid work, and so mitigate rises in unemployment. Arrangements such as part-time work, job sharing, flex hours and other work arrangements are being devised to provide flexibilities for individuals and to offset retrenchments. The OECD terms these flexible working arrangements new time arrangements. They can operate to the benefit of employers or employees and sometimes both.

Employers seek various forms of workforce flexibility. They particularly seek 'numerical flexibility' allowing the size of the workforce to be adjusted by the hiring/firing of temporary workers. It is helpful to distinguish the new time arrangements from the traditional working hours arrangements of shift work and the working of overtime. These schemes of providing numerical flexibility have been used extensively-a point made by Gerhard Bosch of the OECD,

Flexible working time arrangements are actually nothing new. Overtime is a long established way of extending operating time and working hours to meet firms' requirements. Shift, night and weekend work are equally familiar. Everybody who has looked in detail at the reality of firms' time arrangements in the past is well aware of the wide range of formal and informal arrangements that exist in order to create the flexibility needed to match working time and operating hours to the needs of firms and individuals (2).

The working hours flexibility debate is also often described in the context of a 'core-periphery' labour market (3). Firms employ a core of full-time employees. These comprise employees who are well-trained and thus valuable to the employer. Where seasonal factors or operational demands require, additional temporary workers may be employed (and later dismissed). Flexibility can go beyond the employment relation and extend to the use of contractors who may work off the employer's premises.

However, the work redistribution issue centres mainly on the core workforce wanting or being willing to reduce their hours. Less than full-time employment such as casual and part-time work appear to be the converse of 'full-time' work and the two terms are often used synonymously. Part-time work may be permanent or casual. To make the change to less than full-time hours, employees usually seek permanency and, as will be discussed further, this approach often conflicts with employers' perceptions of the responsibilities of the 'core' workforce.

Changes to ordinary working hours may also bring about a further restructure of roles and responsibilities of individuals and families. Patricia Hewitt suggests that what is involved in adopting working time flexibility arrangements is more than a slight adjustment to standard working hours. She is critical of the mindset which accompanied the former regimen of the eight hour day and five day week:

It pervades the culture of business, management and public life. It affects the organisation and strategies of trades unions as well as most discussion of full employment. It indirectly influences decisions in many other policy areas, including transport, leisure provision, child care and the care of elderly dependants .. . This model ... simply does not fit modern industrial countries (4).

Some reasons for the growth of new time arrangements

One development which has prompted the use of new time arrangements has been the international liberalisation of retail hours and the downstream harmonisation requirements to service the retail trade in manufacturing, storage and transport. The composition of cost structures in large part support the use of 24 hour operation in retailing. Probert observes that in the case of large supermarkets, the extra costs of being open as opposed to closed are marginal (5).

A second factor promoting new time arrangements has been the increasing personal and social costs associated with the journey to and from work i.e. traffic congestion and parking shortages at peak periods Also important in the US context, has been the force of 'Clean Air' legislation. This federal US law targets ten or so heavily polluted US cities and requires employers to devise ways of reducing the use of car transport by their employees.

The third factor has been industrial restructuring, technological change and the effects of recession whereby employers and unions seek alternatives to retrenchment and firms seek to re-arrange their cost structures. The combination of changes to work patterns, the labour force composition (the change to two income families especially and the movement of more women into paid work) and transport needs has also been recently explored in an Australian context (6).

Additionally, workers with family responsibilities and older workers may have different concerns, but they may share an interest in some forms of working time flexibility, such as educational leave, shorter hours and other arrangements and more flexible hours or phased retirement.

The OECD notes that the in the course of a century, annual average working hours for an individual have decreased from 3 000 to 1 700 (7). The ILO in its review of working hours flexibility cites the dominant reason for the current re-examination of the arrangement of working time is the long term reduction in hours of work which has occurred in many industrialised countries. As it says,

it would be impossible to ignore the stimulus given to greater flexibility. As working time gradually has become disconnected from the operating time of enterprises, both workers and employers have been faced with new scheduling needs and opportunities.

Behind the pressure for reduced hours and increased flexibility are the high levels of unemployment found in many countries. While the potential for employment generation through reduced hours or increased flexibility is highly controversial it is apparent that the momentum for shorter hours and greater flexibility will not be easily reversed (8). (emphasis added)

Commercial Factors Influencing the Selection of Working Time Options

From its review of literature (such as company personnel practice manuals), the ILO notes that the organisation of working time 'affects and is affected by' three elements: economic efficiency, working conditions and employment. Each of these elements has a number of issues attached to it. These are

  1. Investments An enterprise needs to calculate whether it is more advantageous to extend the operating hours of existing equipment or whether it would be preferable to invest in new equipment.
  2. Volume of production An enterprise might consider the options of increasing or decreasing the volume of production.
  3. Market demand.The enterprise needs to ascertain whether the market can absorb an increase in production without a decrease in product price. If competition is strong, an increase in production may lead to price changes. Thus market demand, potential changes in demand, the number of competitive enterprises and their size, as well as delivery time should he considered.
  4. Capital costs This refers mainly to interest rates and the amortisation time of equipment. The useful life of equipment and the pace of technological development need to be evaluated.
  5. Labour costs Certain working time options may increase labour costs due to the need to compensate for inconvenient hours by paying special rates or premiums. Depending on the schedule, these extra costs may either be compensated or reinforced by an increase or decrease in labour productivity.
  6. Other factors. Other economic factors that may play a role in determining working time options are the cost of power, light and heat; stocking and shipping costs; and transport costs and commuting time of workers.

While the potential for employment generation through reduced hours or increased flexibility is controversial, it is apparent that the momentum for shorter hours and greater flexibility has nevertheless gathered.

Any redistribution of work using new work arrangements will change standard 'ordinary' hours. When the rewards of increases to output are taken as time, it is likely to cause an employment gap and for some period increase the demand for labour. Some practical options for overcoming temporary absences are given in Appendix 5. Rewarding workers for improving productivity by allowing them to take the increase or part of the productivity increase as leave rather than pay may provide employment opportunities. However, Gerhard Bosch of the OECD notes that extensions to working hours by working overtime are still the preferred option for most employers rather than employing new staff (9).

Benefits and costs of new time arrangements for employers, unions and governments

Employers

Employers' demands for flexibility extend to numerical flexibility to adjust the numbers in the workforce, functional flexibility to alter the duties and tasks of individuals, wage flexibility to move to 'performance' criteria and to respond to local labour market conditions and the flexibility to contract out work when required. Where employees prefer shorter hours, employers may regard these non full-time employees as lacking the commitment full-time employees. The implication is that employers may not see PPT arrangements as true alternatives to full-time employment and may not promote its use. Temporary staff may be employed to achieve any required numerical flexibility.

The tendency of management to doubt the commitment of part-time workers has been criticised by one US academic, as reported by Olmsted and Smith:

We have here a really a cultural or attitudinal stereotype situation as to how managers think about part-time employment. It is not that part-timers are less productive; no, they are probably more productive ... the difference is that employers believe that part-timers are not career oriented (10).

Olmsted and Smith also contend that in the US context, the emergence of regular part–time employment and its subsets—job sharing, phased or partial retirement, leave time and work sharing programs (see Appendix 1)—has come about largely because employers want to retain good employees (over periods of slack demand for the firm's product) and to avoid the costs of retrenchments. There has also been a growing understanding that employees perform better if work schedules can be constructed to meet the needs of both the job and the worker.

Advantages for employers

The main advantage for employers in new time arrangements cited by the ILO is the extension of operating hours beyond the normal working day. Other considerations are:

  • longer operating time of equipment means that fixed capital costs can be distributed over a greater number of hours or units of output, thus lowering the portion accounted for by fixed capital in the price of the finished product
  • the increasing cost of investments often necessitates changes to working hours to reduce the pay-back period of equipment
  • the ability to adjust the production capacity to the level and composition of demand and thereby use the available working hours more efficiently. Variations in business intensity may occur during the day, or on certain days of the week or month, or over longer seasonal periods
  • flexible work arrangements can also be used by companies to address unforeseen staffing needs.

However the OECD makes a critical observation of annual hours schemes (see terminology in Appendix 1):

In many cases, new time arrangements have nothing to do with the introduction of interesting and innovative working time models, but are merely attempts to reduce wage costs by replacing expensive forms of working-time organisation with cheaper ones. This is indeed the purpose behind most annual hours schemes (11).

Disadvantages for employers

The potential disadvantages of flexible or new working time arrangements for employers are not often addressed. This may either be due to the fact that negative consequences are not perceived at all, or that they are considered as marginal and negligible in comparison with the benefits. The few disadvantages cited are:

  • increased demands with regard to planning, organisation and management
  • the medium and long-term personnel planning capacity of the enterprise needs to be strengthened
  • co-ordination and supervision may become more difficult and thus require more personnel resources and more responsibility from managers and supervisors
  • higher administrative costs associated with operating and monitoring flexible working patterns, including investment in additional technical equipment, such as electronic data processing equipment; increased costs for social security and enterprise benefits that are independent of wages (e.g. medical benefits, canteen or transport subsidies)
  • increases in training costs, in particular with regard to multiskilling and supervisory and co-ordination needs.

Australian public sector unions sought and gained federal awards facilitating home-based work in 1994; eighteen months later the number of workers using the arrangement was reported to be less than twenty (12). Management has restricted access to the arrangement on the grounds of the cost of locating and connecting computer systems to the homes of workers, possible lack of supervision and potential occupational health and workers compensation concerns.

Unions and employees

Trade unions tend to draw a sharp distinction between working time flexibility, which may have advantages for workers, and working hours deregulation, which they consider a threat to acquired rights and which they strongly oppose.

The need for some numerical and functional flexibility and to decouple of working hours from operating hours is sometimes recognised. Flexible arrangements leading to work during unpopular hours, to irregular schedules, to an intensification of performance standards, and to work at short notice and at any time (in the absence of offsetting penalty rates) are strongly rejected.

Unions recognise the popularity of flexible work arrangements with workers and tend to concentrate on developing equitable ground rules for utilising this scheduling arrangement (13).

Collective agreements containing appropriate long-term provisions on working time and personnel planning and a certain degree of flexible organisation seem acceptable to many unions. The demands of workers' organisations as compensation for increased flexibility include:

  • the reduction of working time without loss of income
  • increased employment security and reduction of precarious work
  • creation of jobs
  • reduction of overtime
  • leave provisions that are advantageous to workers
  • special leave and working time arrangements for specific categories of workers (workers with family responsibilities, older workers, workers with disabilities etc.)
  • equal rights for full-time workers, part-time workers and temporary workers
  • improved education and training possibilities
  • improved working conditions.
Disadvantages for trade unions

Flexible working time schedules can have the following consequences.

  • they may shift the emphasis from collective arrangements to individual arrangements and contracts
  • this may decrease solidarity among workers and diminish the bargaining strength of trade unions
  • individualised working hours may also shift attention away from collective reductions of working hours and thus take pressure off employers
  • flexible hours arrangements may limit the creation of full-time job opportunities.
Advantages for workers

The main advantage of flexible hours is the aim of reducing working time without loss of salary so as to increase employment.

It is not surprising then that the main advantage seen by unions is a reduction of working time. This may have positive effects on the health and social and family lives of workers, either for all workers, for workers in hazardous or strenuous employment, or for special categories of workers, such as workers with family responsibilities, older workers, and workers with disabilities.

The ILO cites certain advantages for workers such as:

  • the safeguarding of employment through increased competitiveness
  • more possibilities to adjust working time to individual needs and thus better co-ordination between personal and working life
  • greater job satisfaction as a consequence of being more independent and receiving more responsibility.
Disadvantages for workers

The ILO mentions the following disadvantages for workers, and these mainly concern family life:

  • the organisation of family life can become particularly strained, since rest, leisure and working time may be different from the rest of the family. The preparation of meals, household work, taking care of the children, all must be constantly adapted to the irregular working hours
  • time spent with family members is reduced. This may cause serious problems between parents and children or between spouses. If the spouse works as well and on a different schedule, difficulties increase and may lead to a separate family and social life
  • contacts with friends and relations have to be planned more carefully; sports, cultural and political activities may become more difficult; leisure time is more often spent alone
  • potential transport difficulties are mentioned, since public transport schedules are frequently adjusted to normal working hours
  • all of these problems are compounded if the worker lives in rural areas.

The advantages and disadvantages for employers and employees are not clear cut. They are meant to be a general representation of interests and in specific circumstances may have much less (or greater) importance.

Governments

Governments have sought to assist the introduction of more flexible working arrangements. However the nature of introduction of working time arrangements has been at the enterprise level, as the OECD observes:

Negotiations have tended to become increasingly concentrated at enterprise and plant levels where positions have become more detailed and sophisticated (14) .

Therefore the form of any government intervention has been tailored to the particular institutional structures of the country's labour market and usually is not prescriptive, and where legislation has been enacted, it can be considerably out of kilter with shop floor operations. The OECD report on flexible working time found that the letter of the work hour law is often side stepped and some countries tolerate practices which violate the letter of the law (15). It also quotes one labour lawyer's reference to a 'certain helplessness' of the legislator in respect to regulating new work arrangements (16). As a response to demands for working hours flexibility, governments prefer to add a margin of flexibility to working hours regulations.

Nevertheless, governments have regulated certain entitlements, increasingly broaching family care leave and paid leave arrangements. The United States has attempted to support employers demands for numerical flexibility and employees demands for income security through short time compensation legislation. The federal law prescribes model legislation which might be adopted by the States and it is described in Appendix 4.

The United States has also responded to employees needs for working hours flexibility by introducing a form of (basic) family care and personal sick leave entitlement. The Family and Medical Leave Act 1993 requires employers of fifty employees or more to provide job security and leave to employees who have worked twenty or more workweeks in the current or preceding calendar year. It mandates up to twelve weeks unpaid, job-protected leave for the birth or placement for adoption of a child, or a serious health condition of an employee, spouse, child, parent. Many US States have similar laws. The federal law does not diminish the provisions State laws which provide a better standard.

For other countries, hours of work are often legislated but are capable of being modified through collective agreements. In short, governments find it difficult to weaken working hours regulations, while nevertheless favouring the new time arrangements. A review of some national approaches to working hours flexibility is contained below in the section 'Working Hours: Overseas Experience'.

Working Time Arrangements in Australia

In Australia, the last major industrial claim for an across the board reduction in standard hours occurred in 1979-82. This was the period when key unions in engineering and manufacturing pushed for wage improvements as well as the introduction of the thirty eight hour week. The forty hour week had become the norm by the mid 1940s.

Working time arrangements became an issue during the wages processes under the AIRC's Restructuring and Efficiency process in 1987 and later under the SEP or ARP (1988-1991). It is this period which opened the debate on working time demands, particularly in respect to shift work, overtime arrangements they use of casual and part-time employment.

The reluctance of unions to readily embrace permanent part-time arrangements in awards has been noted by Romeyn in her report on casual and part-time work arrangements. She quoted a 1986 survey of federal awards which showed part-time provisions to be half as prevalent as casual employment provisions, although this has possibly improved since (17). Awards are more likely to feature casual employment provisions and this helps explain the growth in casual employment, i.e. casual employment is the more prevalent award provision to part-time employment provision. Casual employment grew from 20 per cent of the workforce in August 1989 to 22.7 per cent by August 1993 (18). Casual employment is a more precarious form of employment by comparison to permanent part-time employment, but unions have assumed that the added cost of casual employment would limit its use.

A report prepared for the DIR at the conclusion of award restructuring (prior to enterprise bargaining), summed up the progress made on working time arrangements (1992),

Wages policy in Australia over recent years has focused on the need to improve our productivity and international competitiveness. As a result of award restructuring and workplace bargaining a broader range of options is now available to achieve greater working-time flexibility. These options include continuous twelve hour shifts, loaded base hourly rates, flexible working hours and time off in lieu arrangements (19).

The demand by industry for more flexible working arrangements resulted with the union movement developing guidelines advising unions and employees as to how the new time arrangements might be best managed. This can be seen in release of guidelines by the ACTU in 1990 on part-time and casual work, job sharing and twelve hour shifts. These guidelines are reproduced in Appendix 2. The ACTU guidelines on new time arrangements represent an in-principle acceptance of these arrangements by the union movement. The guidelines also make clear to individual affiliates that the construct of a new hours package for a particular enterprise, such as a twelve hour shift arrangement and any consequent leave or time off arrangements, will determine its suitability and acceptance by a particular workforce.

Another aspect of flexibility concerns pay structures. The work and pay motives created by the traditional Australian pay system comprising a base rate and allowances was confronted at ICI in the late 1980s and the replacement remuneration system using annualised salaries have been emulated in a number of enterprises and industries since. The traditional base pay and allowances wage system has been recently characterised by a House of Representatives Report on the long term future of work,

The traditional pay system which was characteristically a weekly wage with additional overtime or bonuses creates the situation where workers are, in effect, paid for attendance rather than work done which encourages workers to spread the work out to ensure overtime (20).

The new hours arrangements operating at that plant have provided ICI workers with secure pay, including allowances and much greater access by workers to social activities and a social life than was the case under the former continuous eight hour shift arrangements. This does not mean that each employee has been clearly financially advantaged in the move from a base rate of pay and allowances.

The Sheraton Pacific Hotels Agreement is noteworthy because it attempted to limit the use of casuals in Sheraton hotels by basing its staffing needs on an extremely complex roster arrangement (See Appendix 7). As Probert notes, the Sheraton Agreement has been rightly held up as an example of 'best practice' (21). Both the ICI and Sheraton examples highlight the potential gains for working hours arrangements to be made under enterprise bargaining compared to the more circumscribed hours arrangements typified under the centralised wage system.

Working Hour Arrangements

This period of change to the standard working week warrants some analysis of the current working arrangements used within the workforce. An ABS survey on working arrangements (for August 1995) found that out of a workforce of 6.69 million about 4.24 million workers had fixed start and finish times, and of these about 905 300 had negotiated start and finish times (22). For 2.44 million employees, start and finish times were not fixed, with about 1.51 million of these able to vary their start and finish times on a daily basis. The ABS found a slight increase in the proportion of full-time workers who were able to vary their start and finish times compared to 1993. For part-timers the proportion who were able to vary their times remained unchanged. The occupations most likely to be able to vary their times were managers, professionals and clerks. The occupations were times were most likely to be fixed were labourers, plant/machine operators and tradespersons. About 1.77 million workers had access to an RDO as part of their work routine.

Overtime was worked by 2.38 million workers regularly. Of these about 608 000 worked overtime of one to four hours per week; 682 000 (1993: 630 000) worked five to nine hours and 653 900 (1993: 568 000) worked between ten to nineteen hours, while 252 200 (1993:217 000) worked twenty hours or more. About 43 per cent of full-timers worked overtime, while 12 per cent of part-timers worked overtime.

The variations to the standard Monday to Friday working week were strong but not overwhelming. Of the 5.1 million full-time workers, 75 per cent (3.825 million) worked the standard five day week (1993: 78 per cent), 13 per cent worked week days and weekends (1993:12 per cent) and 9 per cent worked varying days each week (unchanged).

Who works long hours?

Three tables have been prepared indicating the incidence of full-time employees working long hours. Table 1 shows the strong increase in the percentage of full-time employees working more than forty hours per week. Table 2 shows the percentage working forty hours or more. Until the mid 1980s, this trend was downward and would no doubt reflect the trends to shorter hours which the ILO and OECD refer to. It can be seen that whereas it was the norm in the 1960s for about 30 per cent of full-time workers to work more than forty hours, by the early 1990s and taking the recession into account, it was common for forty per cent or more full-time workers to work more than forty hours. Table 3 further breaks down hours worked.

Table 1 Proportion of full-time employed persons working in excess of 40 hours per week

---------------------------------------------------------------------------------- 
              Worked >    F/T Employed    Worked >40    Total Labour    Worked >40
                 40hrs        Persons*       as% F/T           Force    as % Total
                                            Employed                        Labour
                                             Persons                         Force
                  '000            '000                          '000
----------------------------------------------------------------------------------

Aug-66 1241.4 4348.8 28.5 4902.5 25.3 Aug-67 1294.8 4423.2 29.3 5019.8 25.8 Aug-68 1335.1 4524.8 29.5 5136.8 26.0 Aug-69 1418.0 4610.3 30.8 5261.9 26.9 Aug-70 1501.6 4825.9 31.1 5473.8 27.4 Aug-71 1511.1 4939.6 30.6 5608.4 26.9 Aug-72 1542.4 4988.4 30.9 5753.9 26.8 Aug-73 1630.9 5092.9 32.0 5888.7 27.7 Aug-74 1571.0 5127.8 30.6 5996.1 26.2 Aug-75 1440.4 5046.8 28.5 6119.7 23.5 Aug-76 1403.2 5036.9 27.9 6190.5 22.7 Aug-77 1443.3 5094.6 28.3 6354.7 22.7 Aug-78 1583.0 5045.3 31.4 6403.7 24.7 Aug-79 1687.7 5113.1 33.0 6456.0 26.1 Aug-80 1712.6 5251.1 32.6 6675.9 25.7 Aug-81 1719.5 5337.1 32.2 6774.3 25.4 Aug-82 1650.2 5285.9 31.2 6840.7 24.1 Aug-83 1616.0 5150.3 31.4 6927.9 23.3 Aug-84 1783.7 5318.8 33.5 7070.1 25.2 Aug-85 1850.3 5464.0 33.9 7248.3 25.5 Aug-86 1956.9 5608.8 34.9 7516.2 26.0 Aug-87 2026.4 5671.1 35.7 7694.4 26.3 Aug-88 2249.9 5874.6 38.3 7892.1 28.5 Aug-89 2416.4 6096.8 39.6 8183.7 29.5 Aug-90 2358.2 6141.6 38.4 8392.6 28.1 Aug-91 2229.2 5905.8 37.7 8428.1 26.4 Aug-92 2282.8 5752.2 39.7 8515.9 26.8 Aug-93 2425.8 5800.5 41.8 8537.0 28.4 Aug-94 2660.0 5961.7 44.6 8683.5 30.6 Aug-95 2711.7 6183.5 43.9 8939.6 30.3 ----------------------------------------------------------------------------------

*Defined as persons who worked 35 hours or more a week.

Source: ABS Labour Force (Cat.No.6203)

Table 2 Proportion of full-time employed persons working 40 hours or more per week

--------------------------------------------------------------------------------------------
                 Worked     F/T Employed    Worked 40+ as      Total Labour       Worked 40+
                  40+hrs          Persons            % F/T             Force      as % Total    
                                                  Employed                      Labour Force
                                                   Persons
                    '000              '000                              '000    
--------------------------------------------------------------------------------------------


Aug-66 3535.6 4348.8 81.3 4902.5 72.1 Aug-67 3556.2 4423.2 80.4 5019.8 70.8 Aug-68 3578.8 4524.8 79.1 5136.8 69.7 Aug-69 3576.7 4610.3 77.6 5261.9 68.0 Aug-70 3630.3 4825.9 75.2 5473.8 66.3 Aug-71 3846.5 4939.6 77.9 5608.4 68.6 Aug-72 3861.1 4988.4 77.4 5753.9 67.1 Aug-73 3935.4 5092.9 77.3 5888.7 66.8 Aug-74 3790.0 5127.8 73.9 5996.1 63.2 Aug-75 3699.4 5046.8 73.3 6119.7 60.5 Aug-76 3686.0 5036.9 73.2 6190.5 59.5 Aug-77 3729.8 5094.6 73.2 6354.7 58.7 Aug-78 3518.9 5045.3 69.7 6403.7 55.0 Aug-79 3664.3 5113.1 71.7 6456.0 56.8 Aug-80 3669.1 5251.1 69.9 6675.9 55.0 Aug-81 3671.0 5337.1 68.8 6774.3 54.2 Aug-82 3370.1 5285.9 63.8 6840.7 49.3 Aug-83 3266.2 5150.3 63.4 6927.9 47.1 Aug-84 3340.3 5318.8 62.8 7070.1 47.2 Aug-85 3262.1 5464.0 59.7 7248.3 45.0 Aug-86 3358.1 5608.8 59.9 7516.2 44.7 Aug-87 3447.4 5671.1 60.8 7694.4 44.8 Aug-88 3674.8 5874.6 62.6 7892.1 46.6 Aug-89 3857.8 6096.8 63.3 8183.7 47.1 Aug-90 3841.6 6141.6 62.6 8392.6 45.8 Aug-91 3590.2 5905.8 60.8 8428.1 42.6 Aug-92 3594.4 5752.2 62.5 8515.9 42.2 Aug-93 3654.9 5800.5 63.0 8537.0 42.8 Aug-94 3943.8 5961.7 66.2 8683.5 45.4 Aug-95 4012.5 6183.5 64.9 8939.6 44.9 --------------------------------------------------------------------------------------------

Source: ABS Labour Force (Cat. No 6203)

Table 3 Weekly hours worked 1975-1995 Hours Worked by Employed Persons

--------------------------------------------------------------------------------------------------------
Weekly
Hours               Male              Married Friends         Unmarried Female          Total Female
Worked   ----------------------- ----------------------- ----------------------- -----------------------   
            1975    1985    1995    1975    1985    1995    1975    1985    1995    1975    1985    1995
--------------------------------------------------------------------------------------------------------
0         230713  206488  185706  103793   82950  105356   43877   48397   60553  147670  131347  165909
1-15       89471  144865  292022  197020  303813  398781   68557  148211  291906  265577  452024  690687
16-29     128704  249137  314938  221954  331202  483255   38848  115225  183440  260802  446427  666695
30-34     129622  334636  265289  103712  142047  187522   36386  100158  101146  140098  242205  288668
35-39     403636  721233  717577  184607  241245  357222  161023  243923  260524  345630  485168  617746
40       1602343  953951  844213  371245  214548  266987  285362  243325  189591  656607  457873  456578
41-44     188705  253750  264039   33811   43266   85939   29562   54489   67972   63373   97755  153911
45-48     321962  385795  474631   26317   51799  102855   21915   46328   76481   48232   98127  179336
49+       725470  861237 1314044   61180   97835  205647   31505   55757  120090   92685  153592  325737
TOTAL    3820626 4111092 4672459 1303639 1508705 2193564  717035 1055813 1351703 2020674 2564518 3545267
--------------------------------------------------------------------------------------------------------

% Hours Worked by Employed Persons

--------------------------------------------------------------------------------------------------------
Weekly
Hours               Male              Married Friends         Unmarried Female          Total Female
Worked    ----------------------  ----------------------  ----------------------  ----------------------

          Aug-75  Aug-85  Aug-95  Aug-75  Aug-85  Aug-95  Aug-75  Aug-85  Aug-95  Aug-75  Aug-85  Aug-95
--------------------------------------------------------------------------------------------------------

0 6 5 4 8 5.5 4.8 6.1 4.6 4.5 7.3 5.1 4.7 1-15 2.3 3.5 6.2 15.1 20.1 18.2 9.6 14 21.6 13.1 17.6 19.5 16-29 3.4 6.1 6.7 17 22 22 5.4 10.9 13.6 12.9 17.4 18.8 30-34 3.4 8.1 5.7 8 9.4 8.5 5.1 9.5 7.5 6.9 9.4 8.1 35-39 10.6 17.5 15.4 14.2 16 16.3 22.5 23.1 19.3 17.1 18.9 17.4 40 41.9 23.2 18.1 28.5 14.2 12.2 39.8 23 14 32.5 17.9 12.9 41-44 4.9 6.2 5.7 2.6 2.9 3.9 4.1 5.2 5 3.1 3.8 4.3 45-48 8.4 9.4 10.2 2 3.4 4.7 3.1 4.4 5.7 2.4 3.8 5.1 49+ 19 20.9 28.1 4.7 6.5 9.4 4.4 5.3 8.9 4.6 6 9.2 TOTAL 100 100 100 100 100 100 100 100 100 100 100 100 --------------------------------------------------------------------------------------------------------

Source: ABS, The Labour Force (Cat. No. 6203.0)

What is striking from Table 3 is the dramatic departure from the forty hour week for both males and females over a twenty year period and for males at least, it would be difficult to explain this change solely by the introduction of the thirty eight hour week. It would be important to look at how the composition of the workforce has changed, particularly with the growing proportion of managerial and professionals over the period. A proportion of the slippage has gone into that sector working forty five hours or more, but there has also been slippage toward more people working less than forty hours. Wooden discounts the possibility that the growth in the number of males and females working excessive hours can be explained by people working more than one job. While this has occurred, he calculates that the practice would account for little more than a fifth of the growth (over 1982-1992) of full-time people working more than forty hours per week (23).

The proportion of professionals working more than forty nine hours per week is reported to have risen from nineteen per cent in 1986 to 26.7 per cent in 1994 (24). Probert, refers to social perceptions which require people with higher status jobs to work very long hours with attendance at meetings at either 7.00 am or 7.00 pm expected. Those in lower status jobs are expected to make themselves 'available' at non-social hours-a particular feature of employment in tourism and retail sectors (25).

More money or more time - the stress of work

Freeland, Australian Council of Social Service (ACOSS), argues that Australia is currently at an historically high level of paid employment and that this has come about by more people participating in paid work (26). Freeland argues that to understand the level of 'high' employment, it is useful to calculate the number of hours worked (full-time and part-time) across the working age population. On this basis, he shows that each individual of working age 'worked' an average of ten hours in 1966 and 12.5 hours in 1991. Australians have never been more employed-at least as far as paid employment is concerned. Meanwhile male participation in the labour force has fallen while women's employment has risen strongly and is now at a plateau. Freeland and other researchers argue that we need to redefine 'work', and respond to the redistribution of work which has occurred.

There are additional features of modern work arrangements which belie the trend of the reduction in working hours. There is the problem for many workers of the time taken to travel to and from work which can add considerable hours to the daily work routine. These demands no doubt add to the perception of Australians that they feel that they are overworked. This perception is borne out in a survey on work and leisure conducted by Mackay Research. It reported that most respondents preferred 'a bit less work' than at present and that most responders sought to get the 'balance' between work and leisure right. Survey comments included:

I have never worked so hard in my life. There have been a lot of retrenchments at work, and everyone knows that they have to put their heads down and get on with it and,

No-one ever died saying 'I wish I'd spent more time at the office'. I believe that, but it is amazing how you can get involved in a job and then suddenly find you haven't spent any time with the kids for weeks (27).

This Mackay report found that most respondents did not welcome the idea of working a four day week:

Given the widespread belief that there is not for the time being, enough work to go round, is there, perhaps, some readiness in the community to accept a radical redeployment (for example in the form of a shift to shorter working hours)? The answer to that question appeared to be a resounding "no".

An explanation for the apparent spread of hours worked away from the standard working week has been raised by Tracy and Lever-Tracy. It concludes that the overall trends are towards shorter standard weekly hours arrangements and shorter annual and lifelong worktimes. Within these trends are elements of polarised and redistributed work reductions. Polarised reductions means an increase in work hours for some with an absence of work altogether for others. For males, work distribution is more markedly polarised, i.e. many working long hours but other males are unemployed Women have done better at redistributing their paid employment hours, thus keeping more women in paid work (28). Nonetheless there does appear evidence of stress from long working hours for those in paid employment.

Working Hours and Enterprise Bargaining

One response by workers to longer working hours might be to put working hours on the industrial agenda of enterprise agreements. A DIR report on enterprise bargaining (required under federal legislation to be presented to Parliament annually)) attests to the managerial preoccupation of adjusting working hours to 'suit' their enterprise. The report reviews the 1 360 federal agreements registered in the twelve months to April 1995. It claims

By far the most common employment condition provision included in ... agreements was the issue of hours of work. This provision was included in 68 per cent of (Part V1B) agreements ... The incidence of different initiatives categorised under the broad heading of hours worked varied, with the most common provisions relating to rostered days off ... and span of hours. Most of the hours of work provisions appear to have concentrated on providing employers with greater numerical flexibility, although they have also provided improvements in administrative efficiency (29).

Another analysis by DIR of the 4 996 agreements contained on its database (i.e. including those operating before April 1994) prepared for this paper (table below), shows that the issues of part-time and casual work are being included in agreements, but the more 'liberating' arrangements such as telework or job sharing are much less a feature (although one large industry, the banking industry, is pursuing job share arrangements and the low number of job share provisions in agreements possibly misrepresents the position where thousands of employees may have access to these arrangements).

Table 4 New time arrangements in certified and other agreements recorded by the Department of Industrial Relations' database

---------------------------------------------------
All Agreements              4996       Proportion %
---------------------------------------------------

Part-time 666 13.3 Casual 1215 24.32 Home based work 24 0.48 Job share 62 1.24 Flexible working hours 1157 23.16 RDOs 1919 38.41 ---------------------------------------------------

(Source: Evaluation of contents of agreements contained the DIR database, as at September 1995, provided by DIR for this paper)

This information does not allow a qualitative assessment to be made of these working time arrangements, but their appearance in agreements is some indication of the priority of the parties toward flexible arrangements.

Leave issues are on the industrial agenda. The family leave case has been before the AIRC, with a decision given in 1994 (30). This allowed private sector employees under federal awards access to their sick leave to care for family members. It also allowed facilitative clauses to be inserted into awards providing access to part of annual leave so the employee could use the time to care for family members. Unions sought to aggregate certain award provisions which allow access to leave (other than annual and long service leave) into a block and five days of which can be taken depending upon the particular contingency. Bereavement leave, which is usually an entitlement of two to three days per year, remains dormant for most workers for most years. A decision by the AIRC on 28 November 1995 substantially granted the ACTU's claim (31).

Working Hours Flexibility: Overseas Experience

The working hours debate received a strong impetus after an agreement to reduce hours was signed between the Volkswagen (VW) auto company and its workforce in 1993. Researchers such as Jens Bastian accord much significance to the VW agreement since it marks an important concession from the unions: namely for job sharing to work unions cannot claim increased wages for the lost time (32). Also important is the European Working Time Directive which is reproduced as Appendix 3. The importance of this directive is that it tries to set a limit of forty eight hours per week of paid work. The following summary of international working arrangement rules and options is taken from the OECD and ILO reports cited earlier.

Hours of work of part-time workers in Denmark are a minimum fifteen hours per week and a maximum of thirty hours. In Belgium minimum weekly working hours for part-time workers are a third of the weekly working hours for full-time workers. Overtime hours are all those performed by the part-time worker above the hours set out in the work schedule. Part-time workers in Belgium have priority for full-time employment with the same employer. The maximum daily hours are ten and the maximum weekly hours are fifty. Overtime is compensated for by giving half-days or full days off. Over a three-month period, the average working time must correspond to the hours set out in the collective agreement.

France has less jobs being created than other economically comparable countries with similar growth rates. Agreement has been reached between the major employers' group Patronat and four large unions to commence to cut the five day-thirty nine hour week to four days and thirty three hours. It is hoped that 300 000 to 400 000 jobs can be created over 1996-97. This will include a cut of 50 per cent on employers' social security contribution with each new job created, or for each permanent job converted from a full-time job if this means an additional job is created (33). Also, French employers are relaxing their opposition to working time reduction, but seek that over the course of a year overtime compensation should take the form of time in lieu for the first 100 hours (34). The application of these principles is to be applied on an enterprise basis.

nency for part-time employment. It hopes for the creation of 2 million jobs.

The Netherlands all new positions in the public sector are limited to a maximum thirty two hour week. It did experience a 30 per cent rise in employment between 1983 and 1991, along with a 13 per cent reduction in hours worked per person.

Switzerland in mechanical engineering, an industry arrangement recently concluded allows contractual work time of forty hours per week, but a 'flexi-year' can be introduced. The length of the working week can fluctuate between thirty and forty five hours, provided that over one year, actual hours coincide with contracted hours. plus a maximum of forty hours can be carried over from one year to the next (35). This arrangement is now spreading to other sectors such as construction textiles, watch manufacturing and furniture. Overtime only paid when the upper limit on the bandwith is exceeded.

employers associations and unions as a 'means of increasing the number of people who retain a solid labour force attachment' (36).

The German Government has also encouraged the use of part-time work in a policy approach of June 1994. It is based on the belief that:

  • there is widespread prejudice by employers against part-time employment
  • there is demand for part-time employment from employees
  • administrative and production structures are too inflexible to take full advantage of part-time employment.

Research commissioned by the Government suggests about two million in full-time jobs are willing to convert to part-time. Research undertaken at the Government's request by McKinsey and Co. suggests there to be an initial increase in costs from a conversion of full-time jobs, but offset by better morale and attendance, equal to between to 2 and 4 per cent of labour costs. The program seeks to convert 60 per cent of full-time jobs in Germany to less than full-time arrangements (37).

nd central Europe, processes of economic restructuring are now underway that are very likely to result in greater flexibility in labour legislation. Thus far, most of the changes are still in the planning stage. An example of the likely outcomes is the Czech legislation on flexitime. While it is more flexible than the existing law, limits are placed on the form of the schemes that may be introduced.

In the US there has been little reduction in actual hours of work in industry since 1960. The types of working time arrangements that are found reflect this: they are less comprehensive and less connected to the organisation of work. However, the relatively flexible legislation that has been in force for many years, together with the interests of individuals in more flexible and (sometimes) in shorter hours, have led to the development of novel working time practices.

Japanese practices are quite different from those of other highly industrialised countries. The long hours of work found in Japan and the fact that they have not declined since 1975 are very important. The working time arrangements in Japan tend toward being more rigid. It is also difficult to decouple these working hours arrangements in Japan from the system of life-time employment. However government policy is to reduce average hours from the early 1990s average of 2 050 to 1 806 by the year 2010 (38).

Can New Work Arrangements Create Jobs?

Some reports show that new time arrangements have warded off the threat of redundancies or created new jobs. The ILO reports that some experiments have generated employment. It cites, for example, a French company which increased the number of its workers by 25 per cent, a British car manufacturer recruited 1 200 new workers, and two German car producers hired 900 and 1 200 more workers respectively after flexible working time practices were adopted. These achievements aside, the ILO is also aware that the potential employment benefit resulting from these arrangements is 'highly controversial' (39).

Will there be a broad demand for universal reduction in hours again? Bastian, amongst other researchers, suggests not, at least not while income levels are not reduced on a pro rata basis (40). The OECD suggests that more consideration is likely to be given to flexible hours rather than an across the board reduction.

Bastian argues that there is a growing understanding on the part of employees, and increasingly unions, that work-sharing means pay-sharing and must not be allowed to increase unit labour costs. But as an offset, a decade of growing incomes for most of those in employment in Europe and other countries, increased the numbers of employees who are sufficiently well paid to countenance a tradeoff between pay and working time.

Work sharing is popular because it goes with the grain of more flexible and family friendly working hours. However, the working hours redistribution system hinges on workers' preferences and living standards, and while VW did cut hours leaving many of its workforce unhappy with shorter hours and less pay, Nissan workers in the UK preferred to keep their hours and pay, with a number being offered redundancy (41).

Olmsted and Smith acknowledge that the 1990-93 recession in the US was not conducive to experimentation with hours due to a focus on downsizing and consequent loss of interest in work sharing. They also quote an American Management Survey 1993 which criticised the downsizing philosophy:

Fewer than half the firms that have downsized since January 1988 report that profits increased after the cuts were made, and only a third reported increases in productivity. Almost invariably worker morale suffered As organisations reach the limit of their cutbacks, and understaffing begins to be recognised as a critical issue, the desire to relieve employee stress and retain skills may provide a revived interest in worksharing (42).

In Australia, the case for work sharing has been promoted by the former NSW Coalition Government, while John Langmore MP and John Quiggin have put the case for humanising work through shorter working hours (43).

There are those who doubt the potential of work redistribution. The Hon. Barry Jones MP has agreed that job sharing may be suitable for some workers, and while work can be redistributed with more workers working less hours, 'it rarely works out like that' (44). Sloan is also critical of job sharing on two grounds: one objection arises if workers demand shorter hours without accepting lower pay-'this is unambiguously adverse' since it drives up labour costs. But where workers do accept a cut in income for working fewer hours, the uptake in employment is not certain since the 'employed have different characteristics to unemployed ' (45).

Wooden also argues against the mathematical approach which attempts to redistribute excessive, usually overtime, hours. Many of these hours are unpaid and, where they are paid, the distribution of overtime across a large number of small firms would not be enough to create just one full time job of forty hours, he suggests (46). Wooden does allow for the possibility that there may be some improvement in the productivity of firms due to reduced boredom and fatigue in the workforce, but taking up the unemployed may mean taking up poorer quality labour. Also, the publicised attempts to save jobs by cutting hours (e.g. the VW approach) appear to target those who are not already working excessive hours. In other words reducing the hours of those working say a 38 hour week, while not targeting those working more than 48 hours.

Finally, the Commission on Employment Opportunities commissioned by the Prime Minister in 1993 to prepare the blueprint for the Working Nation strategy, argued against schemes such as work sharing and early retirement. It reported

The evidence to the Commission suggests that while these sorts of approaches may in some cases increase employment in the short-term they lead to a poorer long term employment result primarily because they lower overall productivity levels, and therefore per capita incomes ... This is not to deny that work sharing in particular might have positive implications in some individual cases when the people concerned are prepared to share their incomes as well as their jobs. The evidence suggest, however, that while there are some people in this category, the majority of workers ... would increase their working hours (and their incomes) if they could (47).

Conclusion

The evidence seems to suggest that reduced working hours are more likely to be promoted during downturns and as an alternative to retrenchment. The schemes operate heavily on individual preference and circumstance and do not appear to be amenable to regulation. The debate is obviously associated with quality of life issues, and it would be fair to say that during the late 1980s boom, quality of life issues gave ground to increasing consumption. However, Probert is confident that the cause of redistributing work can be established on the industrial agenda:

We can develop concrete proposals aimed at redistributing work in a range of different ways appropriate to different industries - from banning overtime to promoting flextime, and from pushing for the right to a six hour day to establishing yearly banks of hours as the basis for negotiation (48)

Enterprise bargaining may allow for the improvements in productivity to be returned to the workforce through shorter hours or enhanced leave entitlements. However staff often prefer the income option in preference to leave or shorter hours and this has also suited employers.

The AIRC is required to review federal awards to ensure that they are relevant to industries' needs (49). The recent Family Leave Test Case decisions recommended that unions and employers address permanent part time arrangements with the aim of encouraging less than full time employment practices by including such provisions in awards (if the relevant award was silent on part time employment). A mechanism to review part time work arrangements is now in place with the major industrial tribunal. The Family leave cases will no doubt be recognised in State industrial jurisdictions. So, there are now processes being developed to encourage the investigation of reduced hours for employees who seek or require these.

The impediment to work redistribution appears to be employers' perceptions that key staff who opt for leave or short time arrangements lack commitment to the organisation, and this would seem the most difficult obstacle to overcome since it will determine preferences and practice. Firms are recognising the value of trained employees and a number of enterprise agreements have provided leave and time off options as means of recognising valued staff and their domestic obligations. Overall, there would seem to be limited opportunities to redistribute work to the degree required to make an impact on unemployment.

The data on hours worked in Australia indicate a dispersion of working hours away from the standard working week , both toward shorter hours and excessive hours. The research on excessive hours (more than 49 hours per week) suggests that much of this is unpaid (ie not as overtime), making the task of redistribution that much harder. In addition, where reduced hours have been used to stave off retrenchment as in the VW Germany example, there is not clear evidence that the employees were working 'excessive' hours. The redistribution of hours has affected those working much closer to standard weekly hours.

Nonetheless, the working hours debate opens opportunities for reviewing the imperatives which underpin excessive hours. Even where excessive hours worked are unpaid (ie, voluntary), should the practices be condoned? Do such work demands coincide with a balanced life and balanced domestic responsibilities? Possibly the debate will be expressed in Australia through workforce pressures to create national policy on working hours, most probably along the lines of the European Working Time Directive, and may attempt to set guidelines on limits on time worked on the basis of health and safety and quality of life improvements and less so on employment targets.

Appendix 1 Terminology

Flextime is the generic term for flexible scheduling programs or work schedules that permit flexible starting and quitting times within limits set by management.

The flexible periods are usually at either end of the day, with a 'core time' set in the middle, during which all employees must be present. The employer can adapt flextime to the organisation's individual needs through the decisions made about such issues as 1) whether flexibility is a daily or periodic choice; how core time is defined and whether credit and debit hours and 'banking' of hours are allowed.

According to Olmsted and Smith, flextime was the first major divergence from the standardised forty-hour, 9-5 workweek. The concept of allowing employees some individual choice in their starting and quitting times was introduced in Germany in 1967. At that time, it was seen as a means of relieving transit and commuting time problems. Shortly thereafter, flextime began to gain adherents in Switzerland as a way to attract women with family responsibilities into the labor force. The Hewlett-Packard Company is credited with introducing flextime in the US in 1972, after having tried it first in a German division.

Flexplace is another term for: telecommuting, working from home, satellite office or telework . Its use is based on the growth of personal computer use. It is dubbed the alternative lifestyle method of work and allows management to decrease their accommodation overheads while employees can escape the daily commute. The US Federal Clean Air Act 1990 requires employers of one hundred or more employees in designated badly polluted region to design 'trip reduction programs'. One recognised trip reduction program is the adoption of telecommuting practices.

Permanent part-time (PPT) is part-time employment that includes job security and all the other rights and benefits available to an organisation's regular full-time workers on a pro rata basis. Most countries have witnessed a growth in part-time arrangements. PPT has become popular due to increased participation of women in the workforce, the shift from production based to service based manufacturing, and the increasing need of workers for more personal time.

Compressed workweek refers to a (standard) workweek that is condensed into fewer than five days, e.g. into 4x10 hour days, or 3x12 hour days, or the 9/80 format which allows a day off once a fortnight. In the Australian construction industry 'shorter hours' were introduced through a form of this system which facilitated the reduction of the forty hour week to thirty eight hours, so gaining a rostered-day-off (RDO) once per fortnight. It is said that the compressed work week can be used to attract labour into otherwise unattractive shifts.

Job sharing is a form regular part-time work in which two people voluntarily share the responsibilities of one full-time position, with salary and benefits pro-rated. The term covers a spectrum of shared responsibility ranging from jobs that are essentially split between two people, requiring no, or very little interaction, to jobs that must be shared collaboratively in all aspects. At one end are job sharing receptionists or production line workers, where the amount of sharing may be limited to discussing the co-ordination of their schedules. At the other extreme are occupations such as executive assistants, engineers or marketing directors who often need to be interchangeable.

Work sharing is an alternative to retrenchment, in which all or part of an organisation's workforce temporarily reduces hours and salary in order to cut operating costs. It has a long history in the US where state and federal legislation support its use, and in some situations make work sharing mandatory. In states where work sharing known as short time compensation (STC) Legislation has been passed, the reduction in incomes can be partly recompensed. An extract from US Department of Labor (DOL) guidelines on STC is included in this paper as Appendix 4. STC avoids the legal contest associated with mass redundancies. It is also said to provide equity in the workplace since the opportunity for cost saving through reduced working hours can be distributed across a firm, whereas retrenchment more likely affects production workers and is less likely to affect administrative staff.

V-time programs are a way to offer reduced work time options to a broad base of employees in a way that integrates part-time with full-time employment. V-time is a time/income trade-off arrangement that allows full-time employees to reduce work hours for a specified period of time with a corresponding reduction in compensation. It differs from part-time employment as there is usually a time limit designed for a return to full-time work.

Leave time is one V-time option. It is an authorised period of time away from work without loss of employment rights. This absence may be paid or unpaid and is usually extended and taken for such reasons as family responsibilities, health care, education and personal growth, or career breaks. Is usually linked to periods of paid leave-can be for extended holidays or sabbaticals.

The APS is experimenting with leave time arrangements such as the 48/52 scheme which allows an employee to reduce their salaries over a year by about seven per cent and so 'purchase' an additional one months leave.

Phased and partial retirement: Phased retirement is a way for individuals to retire gradually by reducing their full-time employment commitment over a set period of years. Partial retirement is a part-time employment arrangement in which salary may or may not be combined with partial retirement income. It has become relevant due to the cost of downsizing programs; the spectre of employee shortages over future years, especially for older workers with difficult to replace skills and can also create options for younger employees.

Annual hours: This also is a system to allow for a variety of both leave taking and hours working over the course of a year. The move to annualised hours is said to have started in Swedish and Finnish pulp and paper industry in 1970s. It is most often used in continuous production industry; can be used to bring on cultural change via adoption of a 'salaried' perspective. It forces a redefinition of overtime.

Annualised salary is a variation of the annual hours approach. In Australia, the best known experiment with annualised salaries has been the ICI Botany plant, which introduced annualised salaries, incorporating penalty and other allowances into weekly or fortnightly pay (see Appendix 6 for a description of the ICI approach to annualised salaries).

Timesharing: This arrangement allows one individual works for more than one organisation on a regular basis.

Appendix 2 ACTU Codes of Conduct on Twelve Hour Shift Work and Casual and Part Time Work

Twelve Hour Shifts (1990)

This code of conduct by the ACTU spells out that the introduction of twelve-hour shifts should only be permitted where there is a continuous work process or other special circumstances can be shown to exist; where twelve-hour shift work will not impose excessive physical or mental workload; where, after a proper examination of the possible injurious effects to employee health and social well-being, there are demonstrated benefits for the workers concerned; after full consultation with union(s) and with the support of at least two-thirds of workers affected; and in conjunction with possibilities of reducing working time generally.

The ACTU also insists that rosters must be developed in consultation with employees through their unions, and provision made for on-going consultation and resolution of disputes about the rosters. It further suggests that the introduction of twelve-hour shift work should be on a trial basis for twelve months to allow workers to evaluate the changes.

To minimise the health and safety risks of twelve-hour shift work, the ACTU also advises unions to negotiate measures, such as a maximum of two night shifts in succession; at least a twelve-hour interval between shifts; a short cycle period with regular rotation; at least two free weekends each month; allowing workers some flexibility about shift change times and shift length; additional paid breaks and an extended rest period during night shift; no overtime; special rosters for workers exposed to hazards, where health and safety standards are determined on the basis of exposure over eight hours; additional paid leave; early retirement provisions; continued application of weekend and holiday premiums; provision of adequate information on issues such as shift rosters, rest, fatigue, etc.; provision of welfare facilities and services, such as meals and drinks, transport services, rest areas and recreational facilities, etc.; training of supervisors to increase awareness of the special requirements of twelve-hour shift working; provision of health services, including pre-placement health examinations and periodic examinations afterwards and health counselling; and the requirement for employers to take all necessary steps to find suitable alternative employment for workers who are unable to continue shift work for health reasons.

Part-time, Casual Work and Job Sharing (1990)

ACTU policy recommends that part-time work should be negotiated on the basis of 'permanent' part-time work with pro-rata benefits, in a controlled ,manner with a clear ratio of full-time to part-time jobs; and that

Union organisation for part-time workers should involve:

  • union collection of separate membership figures for full-time and part-time workers
  • recruitment to unions of part-time workers
  • removal of barriers to union involvement for part-time workers
  • negotiation of part-time work arrangements, and
  • extension of all employment benefits to part-time workers
  • casuals employed on a regular, long term basis for months or years should not be casual, but 'permanent' employees
  • casual employment should be limited to a short period of time and used only for short-term, irregular , seasonal or emergency employment.

The ACTU guidelines also recommend strategies to decasualise workforces by using PPT work as a means to counter casual employment, and using award provisions to limit the employment of casuals to certain hours or for a limited period.

(Source: Flexible Working Time: Part-Time and Casual Employment, DIR, 1992)

Appendix 3 European Directive: Working Time

The Working Time Directive, adopted by a qualified majority vote of the Social Affairs Council of the European Union Employment Ministers on November 23, 1993 (to be implemented by November 1996), contains the following provisions for all workers:

  • a maximum forty-eight hour week (including overtime) on an average over four months
  • eleven consecutive hours of rest per day
  • thirty-five consecutive hours of rest per week, in principle including Sundays, although this would not be mandatory. The weekly rest periods could be averaged out over two weeks. The thirty-five hours could be reduced to twenty-four for objective technical or work organisation reasons
  • rest break during the day for all workers working over six hours and terms to be fixed by collective agreement or national legislation/practice
  • four weeks' paid annual leave, subject to the conditions of entitlement laid down by national law/practice. three weeks would be permitted for the first three years after implementation of the directive (that is, until 1999). Leave entitlements could not be cashed in (except for outstanding leave on termination of contract)
  • work organisations to take into account health and safety and workers' needs.

The directive also includes special provisions for night workers and modifications to the general rule for certain industries/circumstances to allow them to deviate under specified circumstances-for example, some kinds of seasonal work or activities where a permanent presence is required or continuity of production services is necessary. The details of these modifications would be defined by national law or by collective agreements at national, regional, or local levels as appropriate.

In the future the concepts embodied in annual hours systems would appear to be a promising area for employers seeking to move beyond the programmatic use of flexibility towards more strategic applications.

(Source: Olmsted, B. & Smith. S. Creating a Flexible Workplace-How to Select & Manage Alternative Work Options AMACON, 1994)

Appendix 4 US Guidelines on Short Term Compensation

Highlights of the US Department of Labor guidelines (to State governments) are:

  • there must be a need for the workweek to be reduced at least 10 per cent before a request for STC can be considered
  • STC benefits should be pro rata of regular unemployment insurance benefits
  • employees should not be required to make themselves available for other work or conduct a job search as a test of their eligibility to collect benefits but are required to be available for a normal work week
  • the total reduction in hours under STC should be no greater than the reduction in hours would have been had layoffs taken place
  • during the preceding four months, the employer's workforce must not have been reduced by more than 10 per cent by layoffs
  • the employer must continue to provide health and retirement benefits as though the workweek had not been reduced.
  • where the workforce is unionised, the union must consent to the STC plan.

Definitions

  1. 'Affected Unit' means a specified plant, department, shift. or other definable unit consisting of not less than ( employees to which an approved short-time compensation plan applies.
  2. 'Fringe Benefits' include, but are not limited to. such advantages as health insurance (hospital, medical, and dental services. etc.), retirement benefits under defined benefit pension plans (as defined in Section 3(35) of the Employee Retirement Income Security Act of 1974). paid vacation and holidays, sick leave, etc., which are incidents of employment in addition to the cash remuneration earned.
  3. 'Short-Time Compensation' or 'STC' means the unemployment benefits payable to employees in an affected unit under an approved short-lime compensation plan as distinguished from the unemployment benefits otherwise payable under the conventional unemployment compensation provisions of a State law.
  4. 'Short-Time Compensation Plan' means a plan of an employer (or of an employers' association which association is a party to a collective bargaining agreement) under which there is a reduction in the number of hours worked by all employees of an affected unit rather than temporary layoffs of some such employees. The term 'temporary layoffs' for this purpose means the separation of workers in the affected unit for an indefinite period expected to last for more than two months but not more than one year.
  5. 'Usual Weekly Hours of Work' means the normal hours of work for full-time and PPT employees in the affected unit when that unit is operating on its normally full-time basis, not to exceed forty hours and not including overtime.
  6. 'Unemployment Compensation' means the unemployment benefits payable under this Act other than short-time compensation and includes any amounts payable pursuant to an agreement under any Federal law providing for compensation, assistance, or allowances with respect to unemployment.
  7. 'Employers' Association' means an association which is a party to a collective bargaining agreement under which the parties may negotiate a short-time compensation plan.

Criteria for Approval of a Short-Time Compensation Plan

An employer or employers' association wishing to participate in an STC program shall submit a signed written short-time compensation plan to the Director for approval. The Director shall approve an STC plan only if the following criteria are met.

  1. The plan applies to and identifies specified affected units.
  2. The employees in the affected unit or units are identified by name, social security number and by any other information required by the Director.
  3. The usual weekly hours of work for employees in the affected unit or units are reduced by not less than 10 percent and not more than ( percent.
  4. Health benefits and retirement benefits under defined benefit pension plans (as defined in Section 3(35) of the Employee Retirement Income Security Act of 1974), will continue to be provided to employees in affected units as though their work weeks had not been reduced.
  5. The plan certifies that the aggregate reduction in work hours is in lieu of temporary layoffs which would have affected at least 10 percent of the employees in the affected unit or units to which the plan applies and which would have resulted in an equivalent reduction in work hours.
  6. During the previous four months the work force in the affected unit has not been reduced by temporary layoffs of more than 10 percent of the workers.
  7. The plan applies to at least 10 percent of the employees in the affected unit, and when applicable applies to all employees of the affected unit equally.
  8. In the case of employees represented by an exclusive bargaining representative, the plan is approved in writing by the collective bargaining agent; in the absence of such an agent, by representatives of the employees in the affected unit.
  9. The plan will not serve as a subsidy of seasonal employment during the off season, nor as a subsidy of temporary part-time or intermittent employment.
  10. The employer agrees to furnish reports relating to the proper conduct of the plan and agrees to allow the Director of his/her authorised representatives access to all records necessary to verify the plan prior to approval and, after approval to monitor and evaluate application of the plan.

(Source: Olmsted, B. and Smith, S. Creating a Flexible Workplace-How to Select and Manage Alternative Work Options, AMACON,1994: 333 et seq.)

Appendix 5 Options for Managing the Workload when Employees take Prolonged Leave:

  • Work is re-routed to other departmental employees.
  • A replacement from within the company is obtained on a temporary basis.
  • A replacement from outside the company is hired on a temporary basis.
  • Only urgent work is rerouted to other employees, with the remainder of the work held for the leave-takers return.
  • Work is forwarded to the leave-taker at home.
  • A permanent replacement is obtained, and the leave-taker is transferred to another job.
  • A permanent new replacement is hired.

(Source: Olmsted, B. and Smith, S. Creating a Flexible Workplace-How to Select and Manage Alternative Work Options, AMACON,1994: 341)

Appendix 6 ICI Botany: The 'Annualised Salary' Approach For Engineering Technicians (Fitters and Riggers)

Introduction

This summary outlines the 'annualised salary' arrangements under the Metal Trades ICI Botany Agreement negotiated with the Metals and Engineering Workers Union (MEWU) and Federation of Industrial Manufacturing and Engineering Employees (FIMEE).

This s.115 agreement and three others assisted in achieving a dramatic turnaround in performance, profitability and employee morale. There is now one s.134C site agreement incorporating all unions at ICI Botany.

The Process Of Change

ICI Botany first started turning its operations around in 1986 through a Green Paper (developed solely by management) outlining a log of claims by management aimed at removing a number of negative workplace practices that emerged over the last thirty years.

In early 1988 meaningful consultations with the workforce about their vision for the future took place. Needs identified by the parties included an improved organisational structure, greater reliability and precision in the making of the product, improved service and innovation, and an appropriately multiskilled workforce

The need for real change saw changes in the way people worked, rather than a new form of words, as the key outcome. This was reflected in the three years taken to develop new work organisations and put appropriate training programs in place which are ongoing.

Type Of Agreement

The Agreement was negotiated with the MEWU and FIMEE. The Agreement was negotiated as a Certified Agreement under the former Section 115 of the Industrial Relations Act ('the Act'), and certified by the Commission on 18 November 1991 to expire on 29 January 1992 to bring it in line with the expiry dates of the other certified agreements.

Under the Agreement former weekly wage rates have been renegotiated into a composite annualised salary based on a previously developed formula (see below).

Remuneration Levels and Adjustment

Employees are paid an all-inclusive annualised salary which includes base salary, overtime, call ins and all other allowances and shift premiums associated with the conditions of employment under the Agreement.

This annualised salary is based on averaged overtime levels over the previous three years. In the event that overtime levels are reduced, the Agreement provides that salary levels will be maintained.

Salary adjustments are granted on attainment and successful assessment of agreed skill levels in the career structure.

Flexible Working Time Arrangements

Flexible working hours are provided for permanent employees and casuals employed either 'part-time' (employed one day to three months) or temporaries' (in excess of three months).

The parties mutually agree on the hours of work having regard to business needs and provided that an average of thirty eight hours per week is worked. In ensuring 24 hour plant coverage employees maintain their own workgroup rosters and cover any absences within their workgroup having regard to safety and statutory requirements. Agreed work-force levels are maintained during the life of the Agreement.

No employee will be required to work more than sixteen hours per twenty four-hour period with a ten-hour break allowed between work completion and commencement time.

Meal breaks are to be determined by the workgroup and may be staggered to meet the needs of the business.

Plant shutdowns have been included in the salary formation, but do not attract any additional overtime payments.

Public Holidays

As penalty rates are included in the annualised salary, employees are only entitled to one day off for each day worked. All statutory public holidays are observed with the proviso that employees working on any public holiday shall receive an alternative day off as agreed by their workgroup.

Payment of Leave

For employees remaining in employment, accrued annual leave, long service leave and leave loading are paid at the annualised rate. Employees leaving of their own volition are not entitled to payment at the annualised rate except when they die or leave for reasons of retirement, voluntary retrenchment, or retirement due to ill health.

Payment of Annual Leave Loading

Annual leave loading is paid in full in December of each year. As a transitional arrangement outstanding annual leave loading (based on pre-existing base rates) was paid to employees over a maximum period of six months to minimise the cash flow impact. Any leave loading under the new Agreement is paid at the annualised rate.

Leave Entitlements

Maternity, paternity and adoption leave are covered by the Agreement. Annual leave is based on the Metal Industry Award standard. Long service leave applies as per the NSW Long Service Leave Act of 1955.

An example of the substantial improvements in productivity involves the Botany Propathene Plant which last year (1991) cut its first-run reject rate (that requiring reworking or discarding of poor quality output) from 16 to 4 per cent.

(On 3 September 1992 Commissioner Johnson of the AIRC ratified a s.134C agreement at ICI Botany covering all unionised employees (FIMEE, MEWU and Electrical Trades Union).

Calculating the Annualised Salary of an ICI Engineering Technician Level 1
  1. The base weekly rate is determined from the relevant MTIA award for a fitter. This rate includes a supplementary payment and a trade tool allowance
  2. To this base rate add site allowances such as the Chemical Industry Special Rates Allowance, Availability Allowance, Laundry Allowance, Site Tool Allowance, Post Trade Training Allowance. Also add the 2nd instalment of the Structural Efficiency round and the ICI productivity allowance.
  3. Determine a weekly value for periodic payments associated with former shift and overtime arrangements including: Meal Allowance, Travel Allowance (Call-ins), First-Aid Allowance, Confined Space Allowance, Dirt Allowance. Reduce this to an hourly rate.
  4. To the rate determined in point 2, add an average overtime period of 8.4 hours per week at a 1.8 hourly loading rate (which adds the $ equivalent of 15 hours work).

The final salary will comprise the values of 2+3+4 , ie the revised base rate including regular allowances, a value for periodic allowances, a shift/overtime component and the weekly rate for these can be multiplied by 52 to derive the annual salary.

(Source: Making Time, Flexibility in the Workplace, DIR, 1992)

Appendix 7 Sheraton Pacific Hotels: The 'Annualised Salary/Loaded Hourly Rate' Approach

Introduction

The Sheraton Towers Southgate Employee Relations Agreement 1992 was negotiated with the then Federated Liquor and Allied Industries Employees Union at the company's new establishment in Melbourne.

The Agreement utilised the recent amendments to Division 3A of the Industrial Relations Act which are specifically designed to assist parties in registering enterprise agreements. Signed on 23 July 1992, the Agreement covers 300 permanent full-time and PPT employees and is effective for a period of twelve months. The parties anticipate that the next agreement will last for twenty four months.

The Agreement operates in lieu of the parent award, the Hotels, Resorts and Hospitality Industry Award (1990) ('the Hotels Award'). The Hotels Award was restructured to provide greater flexibility, including alternative arrangements for penalty rates.

A key feature of the Agreement is its emphasis on dealing with the issue of penalty rates and working time flexibility, which Is a major issue within the twenty four-hour day/seven day week tourism/hospitality industry.

Sheraton has not approached the penalty rates/working-time flexibility issue in a negative cost cutting manner, but has consulted with the union and employees in order to address the issue as part of a broad process of workplace reform, as evidenced in the Agreement outlined below.

Flexible Working-Time Arrangements

Flexible working hours are provided for full-time and part-time employees through the following means.

Full-time employees' ordinary hours are 152 hours in any four week cycle; providing:

  • ordinary hours are between six and ten hours on any given day, before overtime becomes applicable, provided they are part of the monthly roster; employees are entitled to eight RDO per four-week cycle, not necessarily on weekends; and
  • if necessary, employees may work up to ten days in succession PPT employees' ordinary hours of work provide for a minimum of forty eight hours and a maximum of 128 hours in any four-week cycle; with between three and ten hours to be worked on any given day.

Rotating monthly rosters, covering all hours in which the premises operates, are posted on a monthly basis with employees informed in writing at least one days prior to the commencement of each month. However the roster may be altered by mutual consent at any time or by amendment to the roster provided no less than seven days' notice is given.

Overtime

All time worked in excess of or outside ordinary rostered hours is considered overtime and is paid at overtime rates. However at the instigation of the employee there may be an agreement in writing between the employer and the employee to take time off with pay equivalent to the amount for which payment would otherwise have been received. Overtime is allocated according to the company's needs and shared among employees as far as possible.

Public Holidays

The additional cost of employing staff on public holidays is offset by granting the employee a day off in lieu of additional payment or a day with pay can be added to their annual leave entitlement.

Penalty Rates/Remuneration Levels

The issue of penalty rates has been addressed by incorporating them into a loaded-base hourly rate. Included in the base rate are the following penalties contained in the Hotels Award $1.03 premium for every hour or part thereof before 7 am and after 7 pm (Monday to Friday);

50 per cent loading for work performed on Saturday;
75 per cent loading for work performed on Sunday (100 per cent loading for employees handling alcohol); and
150 per cent loading for all time worked on public holidays.

A new four level classification structure has been introduced to replace the classifications contained in the Hotels Award. The new salaries are based on the highest total remuneration paid for the traditional positions within each new level. For part-time employees the calculation includes the 10 per cent premium existing under the Hotels Award.

After nine months employee earnings under the Agreement will be compared with what each employee would have earned under the Hotels Award. If employees earn less under the new annualised salaries arrangements, the company will make up the shortfall. Three months later a further audit will be conducted to compare what each employee has earned during this period with their earnings for the previous nine months.

Allowances

Special rates and disability allowances for working under particular conditions or performing certain tasks are not a feature of the Agreement. The weekly remuneration comprehends all relevant allowances.

Flexibilities within the Award

Much of the flexibility achieved by the Sheraton agreement is also available under the Hotels Award. Many of these arrangements are available in the Hotels Award if agreement is reached between employer and employees.

Casuals and Contract Labour

With the flexible working arrangements available in the Agreement the need for casual labour is greatly reduced. In fact the Agreement states that: 'Except in exceptional circumstances, there will be no positions offered to casual employees'. The result is greater job security for employees, and reduced training and administrative costs for the Company.

Contractors and sub-contractors may be used to carry out work on the premises from time to time, although for any work carried out in the context of the Agreement the contractor must observe the Hotels Award conditions of employment.

Classification Structure

The Agreement has a four level classification structure with each level receiving unique development and training opportunities consistent with the objectives of employee empowerment and job enrichment. The classification structure provides that:

level 1 staff members are rostered to allow for rotation across all work areas in order to provide diversified work experience and on-the job training;

level 2 allows increased scope for decision making and autonomy in all work areas and also provides for job rotation;

level 3 staff are trained to be capable of on-the-job training and supervision of level 1 and level 2 employees; and

level 4 staff are given the skills to be able to be accountable for the quality of all work performed within their areas and also to be capable of supervising other work areas.

The four level classification structure has a number of advantages including reduced administrative costs, reduced demarcation disputes, cross-task flexibility through multiskilling, and greater flexibility to replace short-term absences. Multiskilled employees with greater career prospects and increased job satisfaction are of greater value to the Company leading to a more efficient and competitive workplace. The system of remuneration will reinforce this emphasis on multiskilling. The broadbanded structure provides increased flexibility by reducing the need to hire additional staff or pay employees different rates on the one day for working in higher classifications.

Skills-Based Career Paths

A skills development career structure will apply. For an employee to achieve promotion they must reach the clearly defined competencies and skills for each level. Following this, however, actual progression to any vacancy in higher levels is merit based.

Consultative Committee

A Consultative Committee comprising representatives from management and line staff has been established with the objectives of increasing employee contributions to the decision making process; to focus attention on the requirements of customers and the needs of employees; and to improve efficiency.

New broadbanded four-level classification structure established in the Agreement 'level one' contains the following rates calculated for all traditional positions within each level, namely

Guest Services 1 $326.00;

Kitchen Attendant 1 $326.00;

Guest Services 2 $338.10

Kitchen Attendant 2 $340.30.

From these rates the highest annual salary of all traditional positions within each level ($340.30 for level one) has been taken as the determined minimum for the actual annualised/loaded hourly salary.

$340.30 x 52 weeks = $17 695.60; then a loading for penalties (approx 20.54 per cent) has been added to provide an annual salary of $21 330, an hourly rate of $10.79 based on a 52-week year and a 38-hour week has also been determined.

The annualised salary covers the following relevant penalties from the Hotels, Resorts and Hospitality Industry Award (1990) (the Hotels Award)

Premium of $1.03 for every hour or part thereof before 7:00am and after

7:00pm (Monday to Friday), with a minimum payment of S1.57 for any one day;

50 per cent loading for work performed on Saturday;

75 per cent loading for work performed on Sunday (unless handling alcohol in which case there is a 100 per cent loading); and

150 per cent loading for all time worked on public holidays.

Following nine months of the Agreement, or upon termination of an employee, the company will conduct an audit to ensure the annualised/loaded hourly salary paid under paragraph 1 for an employee's rostered hours is not less than that which the employee would have been entitled to under the Hotels Award for the same rostered hours. This calculation includes the 10 per cent premium existing under the Hotels Award for part-time employees.

(Source: MakingTime, Flexibility in the Workplace, DIR, 1992)

Endnotes

  1. OECD, Flexible Working Time, Collective Bargaining and Government Intervention, OECD, 1995.
  2. 'Synthesis Report' in OECD 1995:18.
  3. See Romeyn, J. Flexible Working-Time: Fixed Term and Temporary Employment DIR, 1994: 7-10.
  4. Hewiit, P. About Time, The Revolution in Work and Family Life, Oram Press, London, 1993:2.
  5. Probert, B. Part-Time Work and Managerial Strategy: 'Flexibility' in the New Industrial Relations Framework, Department of Employment, Education and Training, 1995: 11.
  6. Hensher, D. Battellino, H. & Mackay,A. 'On the Road to Flexible Working Times', Policy, Summer 1994-95.
  7. OECD,OECD Societies in Transition: The Future of Work and Leisure, OECD, 1994: 14.
  8. International Labour Organisation, The Hours We Work: New Work Schedules in Policy and Practice, Conditions of Work Digest, v.2, 1990: 4.
  9. OECD 1995: 19-20.
  10. Dr Stanley Nollard quoted in Olmsted and Smith: 94.
  11. OECD 1995: 22
  12. 'The Myth of the Electronic Outworker' , The Australian Financial Review, 6 July 1995.
  13. Olmsted and Smith: 22.
  14. OECD 1995: 13-14.
  15. ibid.: 21.
  16. ibid: 12.
  17. Romeyn, J. Flexible Working Time: Part-Time and Casual Employment DIR 1992: 7.
  18. ABS Weekly Earnings of Employees Cat.No.6310.
  19. Keily, J. Making Time, Flexibility in the Workplace, DIR October 1992: vi.
  20. Report of the Inquiry into the Workforce of the Future, House of Representatives Standing Committee for Long Term Strategies, 1995: 49.
  21. Probert,B. Part-Time Work and Manageial Strategy:'Flexibility' in the New Industrial Relations Framework, Department of Employment Education and Training, 1995: 33.
  22. ABS, Labour Force Cat.No. 6203, January 1996.
  23. Wooden, M. 'Overemployment, Unemployment and the Work Sharing Debate' in Australian Bulletin of Labour, December 199: 325.
  24. 'High Fliers Work Longer Stay Later', The Weekend Australian, 17 June 1995.
  25. ibid.
  26. Freeland, J. 'Reconceptualising Work, Full Employment and Incomes Policies', The Future of Work, Australian Council of Social Service,1993.
  27. 'Work and Leisure', The Mackay Report, Mackay Research, March 1994.
  28. Tracy, N. & Lever–Tracy, C. 'The Longer Working Week in Australia—Working Time Experiences and Preferences of men', Labour and Industry, v.4,n. March 1991.
  29. DIR, Annual Report 1994, Enterprise Bargaining in Australia—Developments under the Industrial Relations Reform Act, AGPS, 1995: 144.
  30. AIRC Print L6900, 29 November 1994.
  31. AIRC, Print M6700, 28 November 1995.
  32. Bastian, J. 'Work Sharing: the Reappearance of a Timely Idea', Political Quarterly, v.65, n.3, July/September 1994.
  33. International Labour Review v.132, n.3, 1993: 293.
  34. European Industrial Relations Review v.257, June 1995.
  35. ibid, v.258, July 1995.
  36. Olmsted and Smith: 339.
  37. 'Government Launches Part–Time Work Initiative', European Industrial Relations Review v.247, August 1994.
  38. OECD 1994: 14.
  39. ILO, 1990: 8.
  40. cf fn 27.
  41. 'The Case for Work Sharing', The Financial Times, 24 November 1993.
  42. Olmsted and Smith: 336.
  43. Langmore, J. and Quiggin, J. Work for All, Full Employment in the Nineties Melbourne University Press, 1994.
  44. Jones, B. 'Will the Future Work', Australian Business Monthly, December 1992.
  45. 'Job Sharing is not the Answer', The Australian Financial Review, 2 April 1993.
  46. Wooden, M, loc. cit.: 318.
  47. Committee on Employment Opportunities, Restoring Full Employment: A Discussion Paper AGPS, 1993: 69.
  48. Probert, B. 'The Over-worked and the Out of Work: Redistributing Paid Work, Unpaid Work and Free Time' in The future of work, Australian Council of Social Service, 1993: 38.
  49. Industrial Relations Act 1988, s.150A.

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