Chapter 5 - Dissenting Report by the Australian Greens
5.1
The Australian Greens do not
believe the bill should be passed in its current form. The bill does not
achieve the objective of providing a fair safety net for employees. While it
may be said the bill provides a 'stronger' safety net that is only because the
current safety net is so weak.
5.2
The committee has been made aware
of a number of deficiencies in the bill relating to the coverage of the
fairness test, the application of the test and the lack of transparency in
decision making.
Coverage
of the 'fairness test'
5.3
A number of the submissions and
evidence to the committee highlighted the fact that many employees will not
have their agreements subject to the 'fairness test'. Those employees include
all those who have signed a workplace agreement between 27 March 2006 and 7 May
2007 and all those on AWAs whose full time equivalent annual salary is more
than $75 000.
5.4
The Greens see no justification
for these blanket exceptions from the fairness test. While it may be a
difficult task to assess the workplace agreements lodged prior to 7 May 2007, it is
unreasonable for the government to acknowledge there have been employees who
are worse off under such workplace agreements and yet provide no remedy at all.
5.5
We note the submission of Professor Andrew Stewart and
his suggestion that for agreements lodged between 27 March 2006 and 7 May 2007, employees
should be provided with the right to seek termination of their agreements if
those agreements fail the “fairness test”.[1]
In those circumstances and with protection from their employment being
terminated, employees can then enter new workplace agreements which will be
subject to the 'fairness test'. While this is not a perfect solution to the
problem created by the bill and it does not compensate those employees for loss
of award conditions now subject to the 'fairness test', we urge consideration
of the suggestion as an alternative.
5.6
The Greens are also opposed to the
income exclusion. As the ACTU submissions point out, over one million employees
are potentially excluded by these provisions.[2]
Of particular concern is that because the annual threshold amount is applied
pro rata to part time employees there will be part time workers who earn
significantly less than the prescribed amount whose agreements will not be
subject to the test.
5.7
The other means the bill uses to
exclude people from the 'fairness test' is by having it apply only to those
employees whose work is 'usually' regulated by an award. As the bill is currently
drafted this means regulated by a federal award. The committee heard evidence
that these provisions mean that substantial numbers of employees previously in
the state industrial relations system will be excluded.
5.8
We note the supplementary submission
from the Department of Employment and Workplace Relation’s indicates that the
government's policy intent was to ensure that employees working in
'traditionally' award covered areas are subject to the 'fairness test' and that
the government will be moving an amendment in the Senate to this effect.[3]
In principle we welcome such an amendment, but await the detail of this
amendment to consider whether the problem is adequately addressed therein.
5.9
Another issue concerning employees
previously in the state system is when the Workplace Authority Director must
designate an award for the purposes of the test. Again the definition of award
means that the Director can only designate a federal award. However, there may
not be an appropriate federal award to designate if the kind of work performed
by the employee was usually regulated by a state award. This provision has the
potential to mean that some employees previously in the state system will not
have the 'fairness test' applied to their agreements by virtue of there not
being an appropriate federal award to use in the test. The bill should provide
that the Workplace Authority Director can designate a state award in relation
to an employee or employees if appropriate.
5.10
The Greens believe the bill should
be amended so that 'fairness test' must be applied to each and every
workplace agreement lodged.
Recommendation 1
That
the bill be amended so that the every workplace agreement must pass the
fairness test.
Application
of 'fairness test'
5.11
A second area of concern is the
operation of the 'fairness test'. The test is limited to considering a
restricted list of 'protected award conditions.' Submissions from the ACTU and Professor Stewart listed
the range of other award conditions that can be traded away without compensation.[4]
These conditions include redundancy pay, long service leave, rostering
provisions and other working hours provisions, casual loadings that are more
than 20 per cent, any rights to request flexible working conditions and paid
maternity leave. These are important conditions that affect employees' working
and family lives and should be factors in the test if it is to be truly fair.
The Greens believe an adequate fairness test must consider all award
conditions.
Recommendation 2
That
the fairness test considers all award terms and conditions.
5.12
The Greens are also concerned
about the extent of the matters the Workplace Authority Director can take into
account in deciding whether an agreement passes the fairness test. In
particular we note the objections of the ACTU to the Director being able to
take into account an employee’s personal circumstances.[5]
We agree with comments made by the ACTU in their written submission and in
evidence before the committee that such a provision is discriminatory and
should not be contained in the legislation.
5.13
We are also concerned about the
breadth of the 'exceptional circumstances' exemptions open to employers in
respect of the industry, location or economic circumstances of the employer. If
there is to be an ability for an employer to have their economic circumstances
taken into account, in all fairness, it must be done in an open and transparent
manner whereby the employer provides proof to the Director that their business
is in short term crisis. Furthermore, a resulting agreement should be limited
to no more than one year or at least be reviewable after one year so that if
the employer’s business has picked up their employees are not subject to an
inferior agreement for any longer than necessary.
Recommendation 3
That subsections (3), (4)
and (5) of section 346M be deleted, OR alternatively, ...
That any agreement where the employers' circumstances
are taken into account should be in operation for no more than one year.
5.14
Another issue with the application
of the fairness test that was raised with the Committee concerns the provision
that the test in the case of collective agreements requires a consideration of
the 'overall effect on the employees whose employment is subject to the
collective agreement'. This provision allows for a situation where some
employees under the agreement may not be provided with fair compensation for
the loss of conditions while others are. The Greens do not believe such
inequity should be allowed and that a simple amendment should be made requiring
the fairness test to be applied to ensure each employee under the agreement has
received fair compensation for loss or modification of award conditions.
Recommendation 4
That
the fairness test be applied to collective agreements to ensure all employees
under the agreement receive fair compensation for loss or modification of award
conditions.
5.15
A number of submissions also
raised the concerns about defining and assessing 'fair compensation' and in
particular taking into account 'non-monetary compensation'. The Greens share
those concerns and believe the bill should provide a clearer definition of
'fair compensation'. We note the submission of Professor Stewart and
his suggestion, although admittedly not perfect, for a definition of 'fair compensation'.[6]
The Greens believe this suggestion should be considered.
Transparent decision making
5.16
An important issue raised in a
number of submissions refers to the lack of a transparent and reviewable
decision making process in the application of the fairness test. A number of
submissions also recommended the test be applied by the AIRC rather than the
Workplace Authority Director and the Greens believe this suggestion has merit.
The Greens are concerned with the lack of transparency in the decisions made by
the Workplace Authority Director and believe it would enhance the fairness of
the bill if provision was made for a person affected by a decision of the
Director to have the right to request and receive written reasons for the
decision. Furthermore, there should be a process for review of the Director's
decision. These decisions potentially affect people's livelihoods and as such
there should be robust mechanisms to ensure the administrative decisions are
taken in accordance with the legislative requirements.
Recommendation 5
That
a review process of the decisions of the Workplace Authority Director in
applying the fairness be established, including the provision of written
reasons when requested by a party to the agreement the subject of the decision.
Other Matters
5.17
The Committee received submissions
and heard evidence in respect of a number of other matters of concern in the
bill. Two matters of particular interest include what happens when an
agreement fails the test and the protections from dismissal when an agreement
fails or may not pass the fairness test.
5.18
There is concern that in certain
situations an employee under an workplace agreement that fails the test may go
back to having their employment governed by an agreement that would also not
pass the test, for example an pre-7 May 2006 AWA. The Greens believe the
potential for employees to be worse off because an agreement fails the fairness
test is a situation that should be avoided.
5.19
Both the ACTU and Professor Stewart
submitted that the provision protecting employees from dismissal when a
workplace agreement does or may fail the fairness test are inadequate. The
Greens believe section 346ZF should be redrafted to close the loopholes
identified by Professor Stewart to ensure real protection for employees.[7]
Recommendation 6
That
section 346ZF be redrafted to provide adequate protection for employees from
dismissal or other unfavourable treatment.
Welfare to Work
5.20
We note the submission of the ACTU
concerning the relationship with Welfare to Work and the concern that a refusal
by someone in receipt of benefits to sign an unfair AWA as a condition of
employment may lead to an 8 week non-payment period. We support the ACTU’s
recommendation that a consequential amendment be made to the Social Security
Act to ensure that people who refuse to sign an unfair agreement are not
penalised.[8]
Recommendation 7
- That in light of the
amendments to the Workplace Relations Act, the Social Security Act be amended
to ensure that people in receipt of benefits are not disadvantaged by refusing
to take a job on the basis the workplace agreement was unfair.
Senator
Rachel Siewert
Australian
Greens
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