Chapter 1 - Overview
Relations Act 1996 was a major departure from the manner in which the
Commonwealth had regulated industrial relations since 1904. In 1996 the Senate
undertook a major inquiry resulting in a majority report rejecting the Government’s
legislation. Subsequently the Government and the Australian Democrats came to
agreement on a range of amendments enabling the legislation to pass the Senate
and return to the House of Representatives. In final consideration in the
House on 21 November 1996 Minister Reith claimed that the legislation
would provide for;
... a fair go for all so
that the system is appropriately balanced and delivers benefits for both
employees and employers...
and witnesses involved in the current inquiry demonstrate there is little
evidence to support Minister Reith’s claims. In spite of this the Government
has proposed another massive set of amendments less than three years after the
original Act was passed.
case is essentially that the 1996 legislation has delivered the economic gains
promised by the Minister and that the proposed amendments are evolutionary and
necessary for the further operation of the Act. The Government’s case was
presented by the Department of Employment, Workplace Relations and Small
Business (DEWRSB). To a degree the major employer groups who made submissions
and appeared before the Committee shared this view. It is important to note
however, that there is not consensus, even amongst the supporters of further
change, as to the degree or detail of change needed.
The issues put
forward by DEWRSB in its submission may be classified in one of three ways.
Firstly as operational or technical issues, secondly ideological issues and
finally ‘second bite’ issues – those that were considered and rejected in 1996.
by DEWRSB is problematic in two senses: firstly it was selective; and secondly
there are concerns as to how the data actually addressed the terms of reference
in relation to the period that the data actually purports to cover. Much of
the data presented actually related to the early 1990s well before the
operation of the 1996 legislation.
received from a wide range of academics, community organisations, individuals
and unions in opposition to the proposed amendments. This evidence
demonstrated that the 1996 Act has had wide ranging and serious negative social
impacts that, when foreshadowed by the Opposition in 1996, were ignored by the
Government. In 1996 the then Labor Shadow Minister for Industrial Relations,
Bob McMullan, said:
We believe that this bill
will probably not deliver anything like the economic benefits which it seeks,
but it will definitely deliver the social costs which we fear- the social
costs for individuals and families, the social costs for our society as a
was heard demonstrating that since the inception of the 1996 Act there has been
a range of negative outcomes including:
- the award simplification
process which has resulted in the loss of entitlements;
- growth in employment which
has been slower than the preceding three years and is tempered by a growth in
precarious employment – in particular full-time casual work and temporary
a poor outcome in reducing
the numbers of the very long term unemployed;
- widespread fear of and
growing job insecurity;
- the increasing incidence of
loss of employee entitlements due to insolvency; and
- the continued increase in
hours of work in turn impacting negatively on the balance between work and
In addition there
has been a widening of income inequality, in particular wages growth per hour
being less for part-time and casual workers than full-time workers. Income
inequality has also seen a widening gender gap in over award payments. In a
range of industries many of Australia’s most vulnerable workers – in the most
precarious forms of employment and on the lowest wages – have experienced wage
cuts, particularly through the loss of financial compensation for non-standard
The labour market
and economic system in the period 1996 to 1999 has, when compared with the
previous 3 years and with similar economic growth rates, failed to generate the
same employment outcomes. Indeed, the average annual growth of employment in
the period February 1993 to February 1996 was 3.1 per cent, while the average
annual growth rate in employment in the period February 1996 to October 1999
has been just 1.76 per cent. As a result the average monthly employment
generated in the period February 1993 to February 1996 was over 20,000 compared
with an average of just over 12,000 jobs per month in the period February 1996
to October 1999.
Labor Senators conclude:
- evidence provided to support the bill has little statistical
- overall employment growth post 1996 has weakened;
- full time employment growth post 1996 has weakened; and
- the rate at which the long term unemployed has reduced has slowed
Australia’s International Obligations
Australia is one of the original members of the
International Labour Organisation with a long standing reputation for
leadership in this field. It is of concern that following enactment of the
1996 Act the Australian Government was called to account for identified
breaches of ILO Conventions 87 and 98. The Government’s culpability is all the
greater in view of the Majority Report on the Workplace Relations and Other
Legislation Amendment Bill 1996 that flagged potential breaches of these
The overwhelming balance of evidence in this
inquiry shows the provisions of this Bill will put Australia further out of
step with the international community, and make us again the subject of an
embarrassing review by the relevant ILO bodies. The Department of Employment,
Workplace Relations and Small Business advised that dialogue is ongoing on the
1996 Act. However the mere fact that the Government has sought to argue with
the Committee of Experts is not evidence that Australia is not in breach of our
Labor Senators note the slow pace and seemingly
intractable nature of the ongoing dialogue between the Australian Government
and that body, and lack of any commitment by the Government to take remedial
In light of the evidence presented and the
findings of the Committee of Experts the Labor Senators conclude that the 1996
Act contravenes Australia’s international obligations as a member of the
International Labour Organisation. The enactment of further legislation of
this kind is likely to exacerbate Australia’s contravention and is particularly
Labor Senators recommend amendments to the Act to ensure Australia
is able to meet its international obligations regarding labour standards.
Standing of the
Australian Industrial Relations Commission
Much of the evidence received by the Committee
in both submissions and in hearings went to the proposed changes to the
Australian Industrial Relations Commission (AIRC). The historical role of the
Commission and the often judicial background of previous Commissioners has been
important in establishing public confidence in the AIRC as an institution.
The view that the Commission is not a judicial
body but rather a tribunal exercising executive arbitral powers in the same
manner as courts was not challenged by any evidence presented to the Committee.
The requirement to exercise these functions in a quasi-judicial manner is
demonstrated by the role of the Commissioners to hear evidence, apply
legislative provisions and legal precedents, and make binding decisions
affecting the rights of parties. It is therefore essential to ensure that the
Commission is free from improper influence and that public perceptions of its
independence are maintained. Public confidence in the Commission is essential
to ensure acceptance of the Commission’s decisions.
The Government’s proposals to alter the AIRC
were widely criticised in many submissions and during inquiry hearings. The
proposal to limit Commissioner’s terms of appointment was criticised for
compromising the Commission’s independence. The Labor Senators conclude that
even the perception that the Commission is not independent would do it damage
in the eyes of the public. The Labor Senators do not support the erosion of
the Commission proposed in the Bill.
Evidence was considered concerning the proposal
to institute private mediation to act as a supplementary dispute resolution
service to the AIRC. The Labor Senators see no merit in the proposal to create
a regulated mediation system. The fact is that private mediation has always
been available. However, parties have generally had confidence in the
Commission for the resolution of disputes.
discussed the removal of the discretion of the Commission with regard to the
making of awards to settle disputes. Despite the
Government’s rhetoric about bargaining in the workplace, a large proportion of
Australian workers remain dependent on the award system for their terms and
conditions of employment. The award simplification process and the limitation on the Commission to
make awards within the 20 allowable matters provided for in the 1996 act has
seen the most disadvantaged workers further disadvantaged. These workers are
those who depend on the award to set their total terms and conditions of
Labor Senators recommend amendments to the Act:
- to provide a greater role for the AIRC in prevention and
settlement of industrial disputes and to act in the interests of fairness and
in the national interest;
- to provide the Commission with the power to arbitrate on all
employment-related matters in order to ensure that employees have the
protection of effective awards which provide fair and relevant terms and
conditions of employment; and
- discretion be provided to the Commission to arbitrate in cases
where negotiations to conclude an agreement have failed within a reasonable
witnesses drew on the experience of the initial round of award simplification
to strongly criticise the proposed amendments as further reducing basic terms
and conditions. Labor Senators also note the removal
of long service leave, notice of termination and superannuation (which is the
subject of another bill) will have a negative impact on vulnerable workers.
commented on the removal of ‘skill based career paths’
as an allowable matter and the specific removal of ‘training and education’ as
an incidental allowable matter as particularly short-sighted.
The removal of leave for the purposes of serving
on a jury was seen in the same light as the 1996 Act’s removal of Blood Donor leave and Defence Force
leave from awards as an attack on community values. Following the removal of
blood donor leave from awards, evidence presented to the Committee demonstrated
a considerable reduction of blood supplies in Victoria and the ACT. These
provisions cast doubt on the sincerity of comments by the Prime Minister
exhorting corporations to embrace a
...new social coalition of
individuals, business, government, charitable and welfare organisations - each
contributing their unique resources and expertise to directly tackle problems.
It is apparent
that without the compulsion of an award, some businesses seem to be unwilling
to adopt Mr Howard’s principles with respect to providing the opportunity for
employees to undertake valued community activities. This should not have been
an unexpected result.
- while a system of workplace-based collective bargaining should
be retained, alternative options for workers to maintain and achieve decent
wages and conditions should be as readily available through the award system,
and through enterprise or industry-based arrangements; and
- the AIRC be empowered to
make awards without limitation on content to facilitate the settlement of
AWA’s and the
The powers of the
Employment Advocate and the administrative approval procedures stand to be
enhanced by the Bill. It is regrettable that the Employment Advocate chose to,
if not ignore, then only peripherally address the terms of reference for this
inquiry in his written submission. The written submission outlined the
activities of the Office of Employment Advocate (OEA) since inception. In
effect the only deficiency that the Employment Advocate identified with the
1996 Act was that complaints were received regarding the statutory delays
placed in the Act.
In making this point the Employment Advocate has
ignored an important function that the statutory time limits perform. First,
the time period allows employees the opportunity to seek independent advice in
private and away from the workplace. The Labor Senators see this as extremely
important. The lack of review or mechanisms for appeal after approval of an
AWA requires that employees be given every opportunity to make an informed
decision whether or not to sign documents.
The second reason is closely associated with the
first point. The ability to take an AWA away from the workplace for a period
of time, whether advice is sought or not, lessens the opportunity for employees
to be placed under duress to sign. The Labor Senators are of the opinion that
any diminution of this ability would only lead to an increase of cases of
duress in regard to AWAs.
The Office of Employment Advocate has a dual role of administering AWAs and also
assisting in the compliance aspects of the Act. Throughout
the inquiry process a great deal of evidence alleged bias on the part of the
OEA staff in dealings with regard to freedom of association issues and lack of
diligence in investigating claims of duress by employers.
While the Employment Advocate has provided a
response to the allegations made in this process, they are primarily an
unsupported rejection of the claims. The Employment Advocate has failed to
effectively refute the evidence placed before the inquiry of serious bias in
the OEA’s operations.
The Labor Senators conclude that there is a
conflict of interest inherent in the roles the OEA undertakes. Further there
is a widespread general lack of public confidence in the OEA, particularly with
respect to impartiality that impinges on the credibility of the OEA.
Labor Senators recommend that the OEA be abolished.
In addition to the abolition of the OEA, Labor Senators
recommend the following general amendments to the Act with regard to AWAs:
the protection from duress to new employees offered AWAs needs
to be provided. This protection must be in the same terms as that currently
provided for existing employees, and should provide that employees are not to
be treated as new employees in cases of transmission of business;
- a prohibition should prevent the offering of AWAs as a means
of undermining collective agreement making;
- the registration and approval of individual agreements should
reflect the transparency and accountable processes that are applied to
certified agreements; and
- on application by any interested party, any decision made with
respect to AWAs or award designations must be subject to independent review by
Balance and bargaining
A number of the Bill's provisions relate to
issues of balance and the ability of participants to bargain. Evidence as to
the affect of the 1996 Act on the ability of employees to effectively organise
and bargain demonstrates the difficulties currently faced by workers.
The 1996 changes to the powers and role of the
Commission in conjunction with the limitation on matters that may be inserted
into awards, and the limited ability for employees to influence the form of
agreement offered, has impacted negatively on the bargaining position of
workers and unions.
Perhaps the most stark example of the advantage
that employer’s currently hold is a case reported by Australasian Meat Industry
Employees Union (AMIEU) – G&K O’Connor’s Meatworks in Pakenham in
Victoria. Employees have been locked out of the premises for 8 months for
refusing to accept wage cuts of between 10 and 17½ per cent. The employer
unilaterally refused to negotiate and then instituted industrial action which
was described by O’Connor’s own counsel as ‘fairly unsophisticated’ and by
Justice Spender as ‘a baseball bat lockout’. This lockout has now
become the longest lockout
in Victoria since the Great Depression. Despite repeated attempts in both the
AIRC and the Federal Court the union has been unable to resolve the dispute due
to the intransigence of the employer.
The promotion of
‘choice’, which the Government has consistently claimed is available for both
employers and employees, was seriously questioned by many of the participants.
Evidence detailed the ‘take it or leave it’ nature of offers of non-union
certified agreements and AWAs. It was also apparent that some employers flatly
refused to negotiate with unions or employees for the introduction of s.170LJ
certified agreements. The lack of any requirement to ‘bargain in good faith’
has resulted in the wishes of the majority of staff simply being disregarded.
The current Act
has allowed employers to ignore the objects of the Act. It is a cause of
serious concern that the Commonwealth and former Victorian Governments have
been in this group. An example brought to the attention of the Committee was
the actions of the Department of Employment, Workplace Relations and Small
Business where a majority of workers in the Department are union members who
sought to be covered by a further union agreement. The Departmental Secretary
refused to negotiate a s.170LJ certified agreement even though his department
is directly responsible for the administration of the WR Act. This
situation illustrates the unbalanced nature of the current Act where there is
no real choice available to employees.
The DEWRSB example
is far from isolated. The situation in Victoria for state public servants was
...in Victoria ... it has been
impossible to get a promotion without agreeing to an AWA..
The Labor Senators
consider such actions as a form of ‘economic duress’. This deliberate action
to refuse to negotiate demonstrates the imbalance in the employment
relationship and a misuse of managerial powers that is contrary to the
intention of both s.3(c) and s.170WG of the WR Act.
In addition the
Commonwealth and Public Sector Union (CPSU) identified the Commonwealth
Department of Finance and Administration and the new Commonwealth Government
agencies of Employment National and the Australian Prudential Regulatory
Authority as having instituted policies of not negotiating collective
agreements. Staff are required to enter into AWAs in order to improve their
terms and conditions of employment above the base provided for in out of date
It is evident that
refusal to negotiate when a clear preference for the form of agreement has been
made demonstrates contempt for the principle to ‘bargain in good faith’. The
Labor Senators believe that this principle is a fundamental requirement of any
bargaining process and should be accommodated and encouraged within the
industrial relations structure.
Labor Senators recommend that:
- all parties be required to conduct negotiations in good faith;
- in cases where employees have provided a clear indication of
the type of agreement to be adopted, employers be required to negotiate in good
faith to conclude an agreement of that type.
There are a range of proposals in the Bill that
deal with various aspects of industrial action, many of these amendments were
put forward in 1996 and rejected by the Parliament. The evidence presented to
the Committee demonstrates that these proposals will severely limit industrial
action and will fundamentally reduce the rights and ability of workers to be
able to effectively negotiate an agreement.
The evidence presented by DEWRSB regarding
industrial action is that the duration of disputes is declining and compliance
functions are generally successful in dealing with unprotected action.
Industrial action is a recognised and legal part
of a negotiation process and may be undertaken by both employers and employees.
Industrial action is not an end in itself, however Labor Senators recognise
that disputes during a negotiating process are an inevitable part of a robust
Of concern to the Labor Senators is that the
Bill continues to unfairly skew the system away from the interests of
Australian workers and harmonious workplaces. The imbalance in the industrial
relations system was commenced with the 1996 Act which removed the ability of
the Commission to exercise arbitral powers to resolve intractable disputes.
The evidence presented during the inquiry has
demonstrated that this bill will not assist in the reduction of disputation.
This bill promotes disharmony in the workplace, lengthens disputes, adds cost
to the negotiating process and generates social disharmony, which is inimical
to long term economic growth.
The Labor Senators question the logic behind the
Government’s belief that making s.127 orders automatic will act to prevent
unprotected action from being taken. The automatic nature of a s 127 order is
unlikely to affect the willingness to engage in unprotected action.
It is more likely that the motivation behind the
Government’s amendments relate to criticisms levelled against Federal Court
This issue was directly addressed in an open
letter from 80 eminent industrial relations solicitors and barristers,
including three QCs;
The Minister proposes to require the Federal Court to act
promptly in dealing with the enforcement of s.127 orders. There is, however,
nothing to suggest that the Federal Court has acted in anything other than a
prompt and efficient manner in dealing with such enforcement proceedings.
The Federal Court has arranged its business so as to hear s.127
proceedings at very short notice and has been willing to hear such proceedings
outside of normal sitting hours. Raising a doubt about the Federal Court's
willingness to deal expeditiously with the enforcement of s.127 orders would
seem to have more to do with providing a justification for providing employers
with a right to choose between issuing enforcement proceedings in the Federal
Court or State Supreme Courts. It may also have something to do with the
Minister's desire to get even with the Federal Court because of the decisions
made by the Court during the course of the waterfront dispute.
Labor Senators concur with this view and reject
the Government’s proposals as inappropriate.
The assumption made by the Government in
pursuing this matter is that industrial action is ordered by union bosses and
not authorised by the members who actually go on strike. The Labor Senators
reject this narrow minded ideological view that has been promoted in the
absence of effective supporting evidence.
The Minister has consistently claimed that
secret ballots exist in the United Kingdom as a justification for this
proposal. Such claims are disingenuous as the system proposed in this bill is
considerably more prescriptive and overly bureaucratic.
The provisions proposed are unrealistically
complex as well as unnecessary and unworkable. The provisions will increase the
time associated with taking protected industrial action and will place a
financial burden on unions and ultimately their members.
It is apparent that this proposal is more about
placing obstacles to prevent the taking of any industrial action than
responding to a real need. Currently within Division 4 of the 1996 Act the
Commission has the power to order a secret ballot on application from affected
members. It is significant that applications to the Commission for secret
ballots have been rare.
Under the Western Australian system unions are
required to conduct a secret ballot prior to engaging in industrial action. It
is significant to consider the comments by the Western Australian Trades and Labour Council
that the legislative provisions requiring secret ballots for industrial action
in Western Australian have never been used:
...Employers are not
interested in using the provisions, employees are not interested in using the
provisions and, certainly, there has been no attempt by either the government
or any interested party as defined under the state legislation to trigger a
secret ballot process in spite of industrial action occurring.
The proposal to introduce secret ballots is
disincentive to employees to engage in industrial action. In addition the Bill
inserts what can only be described as a punitive provision to withhold at least
an entire days pay from employees regardless of the duration of the industrial
action. There is general agreement between unions and employers that this
provision will encourage an escalation of disputation as there will no
incentive for employees to return to work after a stop work meeting or short
Right of Entry
The Minister describes the 1996 changes to the industrial
relations laws and the current Bill as an attempt to de-regulate the labour
market. Such claims are made despite evidence of an overall increase in
bureaucratic regulation for unions.
Labor Senators find particularly disturbing the
proposals to severely limit a union’s ability to investigate award and
agreement breaches on behalf of members. In the period between the
commencement of the WR Act and 30 June 1999, the Government received 12,951
allegations of non-compliance with awards and agreements. Of these, it was
determined that a breach had occurred in 8,270 cases. When confronted with
this data during the Committee’s inquiry, the Department advised that it had
prosecuted the employers involved in 11 cases, while the employees were forced
to prosecute breaches themselves in 752 cases.
These statistics demonstrate that the Government has seen fit to abrogate its
responsibilities to investigate and prosecute award breaches.
It is evident that the changes to right of entry
will impact adversely on employees who are most vulnerable in the workplace.
The proposed amendments to require a written invitation from a union member at
the workplace prior to exercising right of entry will act as a considerable
disincentive for vulnerable employees to seek assistance.
Disadvantaged workers are already the most
likely to be affected by award or agreement breaches. The evidence from the
TCFUA concerning attempts by the union to investigate possible award breaches
demonstrates the difficulty already faced by unions to assist vulnerable
employees. The fundamental imbalance of the bill is demonstrated here with no
equivalent proposals being put forward to assist unions and employees gain
redress when employers deny access to premises and records.
The Government has comprehensively failed to
provide a case for this change. There is no evidence of widespread abuse of
the current right of entry provisions. The claims made in both submissions and
hearings relate to primarily one industry.
Employer groups admit that provisions currently
exist in the WR Act to deal with abuses of right of entry. There has been very
little use of the current provisions of the Act, which leads to the obvious
conclusion that the vast majority of incidences where unions exercise their
right of entry is done without abuse. In the absence of any demonstrated need
by either the Government or employers the Labor Senators reject the need for
repressive right of entry provisions that would deny protection to thousands of
the most vulnerable workers in Australia.
Freedom of Association
Considerable evidence was received addressing
the aspects of the freedom of association provisions of the Bill. The
Government has sought to add union encouragement clauses to the range of
provisions that are not allowed to be inserted or to remain in awards or
certified agreements. This issue was considered at length in the 1996
inquiry. Ultimately the Commonwealth Attorney General’s Department produced
advice upholding the legality of union encouragement clauses. This is another
case of the Minister having a second bite on an issue that has already been
No evidence was presented to the Committee that
demonstrated that the clauses that currently exist and are legal have been used
to breach the freedom of association provisions of the Act. The Department
supplied no information showing the prevalence of union encouragement clauses
or the existence of any union discouragement clauses in agreements.
The Labor Senators find no reason to support the
prohibition of union encouragement clauses and reject these amendments as
The other major
amendment concerning freedom of association is to prohibit
the existence of closed shops and to effectively define a closed shop as a
workplace with 60% or greater union membership.
were genuinely confused about how the closed shop provisions would be
implemented by the Government. Confusion centred around whether the Office of
the Employment Advocate would commence investigations of workplaces where there
was evidence of more than 60% unionism, or whether this would not occur until
there was some additional evidence that a closed shop was being established or
maintained at the workplace.
Concerns were also
raised as to how the Employment Advocate would establish the level of union
membership in a workplace that was under investigation. Labor Senators find
that these concerns are exacerbated by the lack of public confidence in the
impartiality of the Office of Employment Advocate.
Adding to concerns
of bias in these provisions is the fact that there is no converse presumption
that an enforced non-union shop exists if union membership was below a certain
rate. This issue was raised by several witnesses as an indication that the provisions
were, in reality, designed to prevent effective unions from organising:
The provision could possibly
be theoretically justified if there was a converse proposition, so that if a
workplace did not have 40 per cent union members then the same presumptions
applied. You could then intellectually justify that sort of measure. But,
without the converse proposition, the measure has to be seen for what it
is—that is, an attack on workers’ ability to be in unions.
The Labor Senators conclude that this provision
is designed to create an environment in which the investigative processes
themselves become anti-union and act as a deterrent on union membership. This
conclusion is supported by the arrangements by which prosecutions launched by
the Office of the Employment Advocate require a ministerial direction coupled
with the evidence. That raises serious questions about the OEA’s ability to
undertake investigations in a non-partisan manner.
Given the opposition of many employers to these
provisions, it is unlikely that the Employment Advocate will receive much
encouragement to launch campaigns for union reduction in large and well-managed
firms. Unscrupulous employers will use the 60 per cent membership clause to
incite an investigation for the purpose of intimidating unionists and potential
unionists. Labor Senators have no confidence that the Employment Advocate would
not collude in this practice.
Needs of workers vulnerable to discrimination
Many of the
provisions of this bill will have far reaching consequences for vulnerable and
disadvantaged workers. Evidence presented to the Committee demonstrated that, in practice, many employees are still disadvantaged, and the
provisions of the WR Act introduced in 1996 have exacerbated the problem.
Thirty years after
the first federal case on equal pay, equal remuneration for work of equal value
has not yet been achieved for women. Decentralisation of industrial relations
in Australia appears to be having a negative impact on pay equity, although
many academics cautioned that they are simply unable to produce concrete
findings due to a paucity of data on agreements.
The HREOC submission provides a detailed
critique of the current equal remuneration provisions of the Act and how they
have operated since 1996. HREOC
have made several recommendations to improve these provisions, including:
- allowing equal remuneration applications to be heard by a Full
Bench of the Commission;
- ensuring that the Commission, in determining equal remuneration
applications, can consider remuneration matters not limited to ‘allowable award
matters’ in section 89A(2); and
- allowing the Commission to develop principles for equal
remuneration applications, that provide a default mechanism to establish work
value in the absence of agreement between the employer and affected employees,
and specify that differential rates of pay for male and female employees for
work of equal value establishes ‘discrimination based on sex’ for the purposes
of the WR Act.
The Labor Senators concur with these recommendations.
Discrimination Commissioner in evidence drew the Committee’s attention to the
fact that it was possible for her to intervene in proceedings before the
Commission relating to discriminatory provisions in awards and agreements.
However the Sex Discrimination Act does not allow her to intervene in the
Employment Advocate’s consideration of AWAs. This is an issue of concern to the
Labor Senators as evidence provided to the Committee demonstrated that AWAs are
being used in an exploitative manner and serious questions were raised as to
the efficacy of the no disadvantage test.
The issues of awards are discussed elsewhere,
however the Labor Senators conclude that the current award system does not
provide adequate protections for low paid workers. The limitation of allowable
award matters proposed in this Bill will further marginalise vulnerable workers
by not providing adequate protection through a fair and effective safety net.
Evidence presented by HREOC to the Committee
raised concerns about the impact of award simplification on women. Labor
Senators note that the current award simplification provisions requiring the
removal of directly discriminatory provisions, is flawed as this does not
address the issue of indirectly discriminatory provisions in awards. An
indirectly discriminatory provision could include those allowing changes in
rosters and hours with little or no notice, which can have a very detrimental
affect on women with caring responsibilities. The high profile Steggles
Chicken case this year is an example of how this may occur.
Labor Senators concur with HREOC recommendation
that this issue should be addressed by allowing the Commission and the parties
to awards to deal comprehensively with the issue of eliminating discrimination
The Labor Senators note that the fairness and
effectiveness of awards is not limited to an assessment of safety net wage
increases passed on by the Commission. The award simplification exercise,
reducing awards to a core of 20 allowable award matters, has resulted in the
loss of substantive terms and conditions of employment, which workers in a
disadvantaged bargaining position have little hope of regaining in agreements.
The Labor Committee members recommend that
HREOC’s proposed amendments as detailed above be adopted.
Work and Family
The Committee notes that a considerable body of
evidence was presented regarding work and family. Many submissions to the
Committee dealt specifically with the impact of the WR Act on women, who still
tend to have primary responsibility to care for children and elderly family
members. The evidence presented in these submissions is not encouraging.
Overwhelmingly the witnesses and submissions indicated that the ability to
manage both work and carer responsibilities had deteriorated under the
deregulated environment promoted by the WR Act, particularly through the
deregulation of hours of employment.
The reason that workers were actually worse off
is primarily the initial round of award simplification. In effect the
Government arbitrarily cut terms and conditions of employment, this in turn
‘lowered the bar’ for the no disadvantage test. The Government’s approach to
further limiting and reducing the awards in this Bill will have the same result.
Arbitrary reductions in allowable award matters and the limiting of the scope
of safety net wage increases will not only affect award workers, but will also
reduce the standard against which agreements and their provisions are tested.
also demonstrated that agreements reached under the WR Act were often more
likely to trade off family friendly conditions that had previously been
available to workers.
Concern is also
expressed for what may be described as sham family friendly arrangements.
These are provisions that, at face value, appear to operate to allow employees
flexibility to balance work and family. However, these provisions will often
be worded in a manner that allows them to be implemented by employers to the
disadvantage of workers with family responsibilities. In such cases it is the
practical application of the provisions when workers seek to access them that
becomes the crucial test, not merely the words themselves.
Labor Senators recommend that:
- transparency and review mechanisms for all forms of agreements
be provided to ensure work and family provisions deliver their stated outcomes.
Provisions such as flexible hours or spread of ordinary time should be closely
examined to ensure that work and family responsibilities for current and future
staff are enhanced; and
- priority also be given to the development of model Award and
agreement provisions to assist employees balance work and family
The nature of employment in Australia has been
transformed over the past 20 years, and especially over the past three years.
The most significant element in this transformation has been the decline of
what could be called traditional lifelong, standard full-time employment and
its displacement by more insecure forms of employment such as casual,
part-time, fixed term and other forms of contingent work.
Evidence to the Committee demonstrates that the
pace of this change has picked up considerably over the past 10 years.
Insecure or precarious forms of employment have grown at almost 10 times the
rate of growth in standard employment. From August 1989 to August 1999, the
number of casual employees in Australia rose by 69 per cent and the number of
other employees by 7 per cent.
Between 1996 and 1998 alone, the number of full-time casual employees rose by
10.5 per cent and part-time casual employees by 3.6 per cent. One in four Australians is
now in casual employment.
The extraordinary rate of growth of
casualisation in Australia can be linked to various developments such as
globalisation of the economy, corporate restructuring, development of new
technology and new forms of work organisation. It can be linked also to labour
market deregulation, which was the basic area of concern to the Committee.
A wide range of evidence to the Committee
demonstrates that neither the Act nor the Bill will alleviate the growing
casualisation of the Australian workforce. In fact both the Act and the Bill
seem to be deliberately designed to encourage what the Government
euphemistically refers to as ‘flexibility’ but in reality has been a major
contributor to this growth in casualisation. A flexible working environment
must be to the benefit of both employers and employees. However, the evidence
presented to the Committee demonstrates that due to the fundamental imbalance
of the Act, flexibility has often worked for employers at the expense of
employees. Of concern to the Labor Senators is that the likely long term
effect of both the Act and the Bill will be to further aggravate negative
social and economic consequences for families, individuals and the broader
The proposals in this Bill take no account of this and other
changes; instead they are likely to increase the growing number of
Australians that are outside the protective capacity of agreements or awards
and denied the genuine possibility of union membership and the capacity to
The evidence presented to the Committee
demonstrated the close connection between the apprehension and insecurity in
the labour force, and economic change which has brought about (among other
things) the extraordinary growth in Australia of precarious employment. It is
incumbent on the Government to manage this change so that the consequences of
change can be anticipated and managed.
The Labor Senators conclude that the Government
has failed to deal with the consequences of the 1996 Act which has lead to a
growing feeling of insecurity in the workforce and further that the Bill will
aggravate these feelings.
Submissions and evidence from Victoria received
by the Committee have shown that effectively two classes of workers exist in
that State. Employees whose terms and conditions are set by Federal awards
which provide the limited protection of s.89A, allowable award matters, and
those who are covered by the minima in Schedule 1A of the WR Act, which
includes a mere five conditions of employment.
The Labor Senators conclude that while some
benefits for Victorian employees do exist in Schedule 15 of the Bill (eg
employers would no longer be able to force their employees to work 70 hours a
week for 38 hours pay, and the Department would at least have powers to
prosecute breaches of the minimum conditions), this is clearly inadequate.
The Labor Senators are particularly concerned
that the Bill would actually further disadvantage Victorians working under
Schedule 1A. Proposed amendments which will exempt some types of employees from
entitlements to annual leave and sick leave are without merit.
It is important to note that of the
approximately 300 submissions received from private citizens opposed to the
Bill, more than half of these submissions were from Victorians. The Labor
Senators believe that as a first step in providing minimum protection for
Victorian workers the opportunity should be made available for all Victorian
workers to be able to access federal award coverage.
It is unfair and inequitable that some Victorian
employees have to work under Schedule 1A conditions, while others (generally
union members) have access to the federal award safety net. The Commonwealth
Government ignores this injustice at its own peril, because it is clear that
Victorian employees are fed up.
In keeping with a consistent theme of this bill
the proposal to repeal sections 127A-C is another attack on the most vulnerable
workers. Evidence was received from community groups, churches, law firms,
State Governments and unions that rejected the need for these amendments. The
Government has failed to demonstrate why one of the few protections available
to contractors should be removed.
The Labor Senators conclude that the removal of
the ability of the Federal Court to review contracts for ‘work’ would simply
open up a loophole for unscrupulous employers to avoid the terms of employment
established under awards and agreements, by artificially contracting out work
normally performed by employees. This would encourage the use of precarious
forms of employment at the expense of permanent employment.
The Labor Senators reject any move to limit the
rights of all vulnerable workers.
Overall the Labor
Senators conclude that the evidence provided to the Committee demonstrates that
the Workplace Relations Act 1996 is regressive and has had serious and
far reaching negative social impacts particularly on the most disadvantaged
Australian workers. In addition there is a paucity of evidence to support the
need to extend further de-regulation on the labour market as proposed in this
Labor Senators do not claim to come to the above
issues without preconceptions. But the evidence that came before the Committee
was overwhelming. In particular the opinions of the ordinary people who sent in
submissions opposing this Bill, condemning the changes of 1996 for the damage
it had done to their work, their health, their family lives, their friends and
their community. Also, eminent persons such as Professors’ Hancock, McCallum
and Isaacs; academics like Drs’ Peetz, Pocock and Hall; and the community
groups, lawyers, unions, public servants and employers. Some employers made a
real effort to leave political allegiances aside, and deal with the issues
before us in a dispassionate and thoughtful manner. Notable for their
constructive contributions were the Australian Industry Group, the Victorian
Automobile Chamber of Commerce and the Australian Catholic Centre for
Unfortunately, the majority report does not
reflect much of the evidence. This is unfortunate for those who made an effort
to contribute to the Committee’s Inquiry. The inability to deal honestly and
constructively with the thoughtful contributions of so many people and
organisations does no credit to the majority or to the Senate and the
Perhaps the best example of this assertion is in
the different treatment by the reports of the issue of work and family. How we
balance the competing demands of our working lives with our personal lives is
one of the most difficult issues confronting us as individuals and as a
society. There was significant evidence put before the Inquiry as well as a
much wider continuing debate within the community and the media on this matter.
That it only merited five paragraphs in the majority report is disappointing.
This unfortunate pattern is repeated throughout
the majority report. Where the evidence is problematic for the Government case,
it is either ignored, misconstrued or conclusions drawn in the absence of any
support in the evidence.
In some ways, the majority report serves as an
analogy for the manner that this Government deals with industrial relations.
Where the issue is the bargaining power of workers, prescription reigns – when
the union can see employees, how, where, when they can take industrial action,
under what circumstances, for what reason, how long and the list goes on. When
it comes to the bargaining power of capital, or employers, the Minister wants
flexibility and choice. Choice, but not mutual choice, and little care for the
position of vulnerable workers.
the Labor Senators have structured the remainder of the report in the following
manner. The next 10 chapters involve substantive discussion reflecting the
Committee’s terms of reference. Within each of these policy areas the impact of
the 1996 legislation, and the probable impact of the proposed amendments are
examined. Finally the conclusion sets out, schedule by schedule, our
concerns with the Bill.
recommend that the Act should be amended in accordance with the recommendations
set out above, and consequently that the Bill be withdrawn.
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