Chapter 1

Introduction

1.1
The Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 (bill) seeks to amend the Fair Work Act 2009 (FW Act), Fair Work (Registered Organisations) Act 2009 (FWRO Act), Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act), and related legislation to make a range of changes to Australia's industrial relations framework.

Context of the bill

1.2
The Regulation Impact Statement (RIS) provided as part of the explanatory memorandum states that secure, well-paid jobs are critical enablers for financial independence, stronger communities, and broad-based prosperity. Despite this, the RIS notes that real wages growth in Australia has failed to keep pace with productivity growth and increases in the cost of living. In addition, it contends that the enterprise bargaining system—which should incentivise increased productivity, higher wages, and better conditions—no longer works effectively.1
1.3
In response, the bill seeks to implement commitments made by the Australian Government (government) during the 2022 federal election and at the September 2022 Australian Jobs and Skills Summit. These commitments aim to modernise Australia's workplace relations system, with an emphasis on boosting wages and closing the gender pay gap.

The government's workplace relations commitments

1.4
During the 2022 federal election campaign, the current government made several election commitments regarding workplace relations reform. This section provides a brief overview of some of the key commitments relevant to the bill.

Implementing Respect@Work recommendations

1.5
The current government committed to fully implement all 55 recommendations of the Respect@Work: National Inquiry into Sexual Harassment in Australian Workplaces (Respect@Work report). Among other measures, this included introducing legislation requiring employers to have a positive duty to take reasonable and proportionate measures to eliminate sex discrimination, sexual harassment, and victimisation.2

Improving gender equality

1.6
The current government stated that it would create pay equity and care sector expert panels within the Fair Work Commission (FWC) and reform the equal remuneration provisions in the FW Act to strengthen the FWC's ability and capacity to address gender pay inequality.3

Enhancing enterprise bargaining

1.7
As an outcome of the Australian Jobs and Skills Summit, the current government indicated that it would support the following measures in relation to enterprise bargaining:
provide the FWC with broader powers to arbitrate disputes in relation to, or arising in the course of, enterprise bargaining;
prevent the unilateral termination of collective agreements if termination would reduce employee entitlements; and
improve access to collective bargaining and potentially introduce multiemployer bargaining.4

Limiting the use of fixed contracts

1.8
The current government proposed to limit the number of consecutive fixed term contracts an employer can offer for the same role or a maximum duration, up to a maximum cap of two years, including renewals. Except in limited circumstances, once the cap is reached, the employer would be required to offer the worker a permanent position.5

Improving job security

1.9
The current government committed to amending the FW Act to enshrine 'secure work' as an additional objective of the FW Act. Such a reform would require the FWC to consider job security in its decision making.6

The Australian Jobs and Skills Summit

1.10
On 1 and 2 September 2022, the government held the Australian Jobs and Skills Summit (Summit) at Parliament House in Canberra, which brought together businesses, unions, civil society, and the federal, state, and territory governments.
1.11
The Summit was led by the Prime Minister, the Hon. Anthony Albanese MP, and the Treasurer, the Hon. Dr Jim Chalmers MP, and focussed on:
keeping unemployment low, boosting productivity and incomes;
delivering secure, well-paid jobs and strong, sustainable wages growth;
expanding employment opportunities for all Australians including the most disadvantaged;
addressing skills shortages and getting our skills mix right over the long term;
improving migration settings to support higher productivity and wages;
maximising jobs and opportunities from renewable energy, tackling climate change, the digital economy, the care economy and a Future Made in Australia; and
and ensuring women have equal opportunities and equal pay.7
1.12
In the lead-up to the Summit, since at least August, the government and the Department of Employment and Workplace Relations (department) extensively consulted on reforms to get wages moving, improve job security, and support gender equity.8
1.13
Following the Summit, the government agreed to 36 immediate initiatives, including modernising Australia's workplace relations laws to make collective bargaining accessible for all workers and businesses.9

Origins of collective bargaining in Australia and the current reform agenda

1.14
The following section provides a brief overview of the origins of collective bargaining in Australia and outlines the government's rationale for its current reform agenda.10

Collective bargaining in Australia and the FW Act

1.15
The current bargaining framework is contained within the FW Act and aims to support the tailoring of workplace arrangements to the unique circumstances and requirements of each business and their employees. The FW Act commenced in full on 1 January 2010 in the wake of the global financial crisis. It replaced an industrial relations system which had evolved through several major reforms during the 1990s, culminating in the Work Choices reforms of the then Howard coalition government in 2005–06.11
1.16
Among other things, the intention of the FW Act was to 'promote productivity and fairness through enterprise bargaining'.12 It did this through a number of mechanisms, such as:
providing the right for employees and employers to appoint persons to represent them in negotiations;
facilitating good faith bargaining through orders and assisting with disputes;
allowing low-paid bargaining orders, which aimed to increase outcomes for lowpaid sectors within the economy; and
implementing the better off overall test, aimed at ensuring employees were better off under any agreement than the applicable new award.13
1.17
Notwithstanding the Work Choices reforms, for most of the last three decades, a core principle of the Australian workplace relations framework has been bargaining at an enterprise, not individual, level. This approach involves negotiations between an employer and their employees, including bargaining representatives, with the aim of reaching agreement on the minimum terms and conditions of employment for a particular enterprise.14
1.18
This form of bargaining arose during the 1980s as a way for unions to exceed the government wage controls in place at the time, which were themselves implemented as a response to stagflation15 Australia experienced during the 1970s. The original policy intent of this approach was to 'provide parties at the industry and workplace level with the opportunity to reach agreements directed at lifting productivity and competitiveness'.16
1.19
When the bill for the FW Act was introduced into the Australian Parliament in November 2008, the then Rudd Labor government highlighted evidence demonstrating that collective bargaining and higher productivity were positively correlated, and that the new framework contained within the bill would promote worker productivity.17
1.20
Currently, there are four bargaining streams in the framework. These are:
single-enterprise stream;
single-interest employer authorisation stream;
multi-enterprise agreement stream; and
low-paid bargaining stream.18

Rationale for the current reform agenda

Decline in the utilisation of enterprise agreements over time

1.21
According to the Australian Bureau of Statistics (ABS), the proportion of employees covered by enterprise agreements fell from 43 per cent in 2010 to 35 per cent in 2021. Over the same period, reliance on industry and occupation awards (also known as modern awards) rose from 15 per cent to 23 per cent.19 Further, data collected by the department show that the number of new agreements made in 2020–2021 was approximately half that made in 2013–14.20
1.22
A number of reasons have been posited to explain the decline in enterprise agreements over time. These include:
employers and employees choosing not to replace existing arrangements;
procedural and technical complexity of the system;
the costs involved and perceptions around delays in agreement approvals;
those employers inclined to bargain have already done so;
loopholes and inefficiencies; and
declining union membership.21
1.23
Notwithstanding this longer-term decline, since 2018 there has been an increase in the number of employees covered by current agreements. This increase is the result of the renewal of large agreements that had been relied on for extended periods post their nominal expiry date. This trend was particularly evident in the retail sector, as demonstrated by the national Woolworths supermarket agreement in 2018, as well as the education and higher education sectors, where 13 new university agreements were made.22
1.24
Currently, agreements in place continue to operate past their nominal expiry date unless they are replaced with new agreements or are terminated by the FWC. Hence, these agreements remain fully enforceable during this period, even if there have been substantive changes to the relevant modern award. This can result in situations where employees' overall pay and conditions are less under an agreement than they would be under the relevant award.23
1.25
Further, although most agreements provide for annual wage increases prior to their nominal expiry date, it is uncommon for increases to continue past this date, resulting in agreements operating with no further wage increases for employees.24
1.26
The Productivity Commission recently noted that 56 per cent of employees covered by an agreement are on an expired agreement, with this figure considerably higher in various industries, including health care and social assistance, education and training, and accommodation and food services.25 In fact, the Australian Institute of Employment Rights highlighted that just 14.7 per cent of employees in Australia are covered by an enterprise agreement that is not expired.26

Ongoing inequality and the gender pay gap

1.27
According to the Workplace Gender Equality Agency, data shows that the gender pay gap27 in Australia is currently 14.1 per cent. Research highlights that a combination of salary differences between men and women and gender concentrations within specific industries contribute to this gap.28
1.28
It has been argued that countries which enable both single and multi-employer bargaining have both lower wage inequality and higher employment, and that this outcome is particularly evident for vulnerable cohorts, including women, and for individuals employed on a temporary or part-time basis.29

Wages growth has decoupled from productivity gains

1.29
Productivity measures the efficiency of production within an economy and relates inputs, such as labour and capital, to outputs, such as goods and services. Productivity increases if additional output is produced from the same level of inputs, or an equal amount of output is produced with fewer inputs.
1.30
Labour productivity is generally driven by capital accumulation, research and development, innovation, management practices, and workplace arrangements—all of which can be influenced to varying degrees by enterprise agreements.30
1.31
Historically, labour productivity and real wage growth have been highly positively correlated, and labour productivity growth is generally considered to be a key driver of long-term real wage growth over time. This is based on the rationale that if workers are more productive, firms are able to pay higher wages, as well as take on additional workers. Over time, this places upward pressure on wages and can result in higher standards of living.31
1.32
However, this longstanding relationship has reduced over time and the two variables appear to be 'decoupling'. Such an outcome has significant ramifications for workers, as they no longer benefit to the same degree from their increased productivity. For example, over the last decade, productivity growth in Australia was 11 per cent, while real wages growth was only 0.1 per cent.32
1.33
Both nominal and real wages growth in Australia over the last decade has been not just the worst in post-war Australian history, but also among the worst of any Organisation for Economic Co-operation and Development (OECD) countries.33

Non-compliance with international obligations

1.34
Many submitters to the inquiry noted that Australia's severe restrictions on workers' rights to collectively bargain and take industrial action are inconsistent with Australia's obligations under International Labour Organisation (ILO) conventions, including the Freedom of Association and Protection of the Right to Organise Convention No. 87 and the Right to Organise and Collective Bargaining Convention No. 98.34
1.35
Several witnesses also noted that Australia is an outlier among OECD nations for its substantial restrictions on access to multi-employer bargaining in the FW Act, particularly in comparison with comparable Western European countries.35

Power imbalances during enterprise bargaining negotiations

1.36
A fit-for-purpose enterprise bargaining framework must promote the ability of businesses and employees to bargain on an equal footing. However, it is argued that exploitation of loopholes and the unintended usage of FW Act provisions has eroded this principle over time and resulted in power imbalances during collective bargaining negotiations.36
1.37
Evolving case law and a decade of lived experience with the FW Act continues to reveal issues. For example, in the 2015 Aurizon case, the full bench of the FWC expanded the ability of employers to apply to unilaterally terminate, or threaten to terminate, an expired enterprise agreement during the bargaining process. It has been argued that this is an unfair negotiating tactic as it influences employees' decision to accept a new agreement, with potentially inferior pay and conditions to the existing agreement, as the alternative would be to revert to the even lower modern award.37
1.38
Several submitters noted that Qantas used the threat of enterprise agreement termination as a bargaining tactic with their international flight attendants. In that instance, termination and reversion to Award rates would have represented a pay cut of between 25 to 70 per cent. The threat of this substantial pay cut enabled Qantas to coerce workers into voting for an offer that had earlier been rejected by a resounding 97 per cent majority.38

Overview of the bill

1.39
The bill seeks to amend the FW Act and related legislation to make changes to industrial relations laws relating to enterprise bargaining processes, job security and gender equality, workplace conditions and protections, and the abolition of the Australian Building and Construction Commission (ABCC) and Registered Organisations Commission (ROC).
1.40
This overview is based largely on the provisions of the bill as referred to the Senate Education and Employment Legislation Committee (committee) on 27 October 2022. A summary of the government's amendments to the bill is provided in Chapter 2.

Changes to enterprise bargaining

1.41
The bill seeks to improve the enterprise bargaining system by reducing barriers to the existing multi-employer bargaining streams under the FW Act to allow more employers, employees, and their representatives to engage in the bargaining process on an equal footing.

Supported bargaining stream

1.42
The bill would amend the existing low-paid bargaining provisions in the FW Act to create a supported bargaining stream.39 Under the bill, the FWC would be required to make a supported bargaining authorisation if it is satisfied that it is appropriate for the relevant employers and employees to bargain together when considering:
the prevailing pay and conditions in the relevant industry/sector, including whether low rates of pay prevail in the industry or sector;
whether the employers have clearly identifiable common interests which may include geographic location, the nature of the enterprises to which the agreement will relate, and the terms and conditions of employment in those enterprises, and whether they are substantially funded, directly or indirectly, by the Commonwealth, a State or a Territory;
whether the likely number of bargaining representatives is manageable; and
any other matters the FWC considers appropriate.40

Cooperative workplaces bargaining stream

1.43
The bill would amend existing provisions in the FW Act related to the making of multi-enterprise agreements to be known as the cooperative workplaces bargaining stream. The proposed changes would allow employers and employees to apply to the FWC to be covered by an existing cooperative workplace agreement. Specifically, the bill would empower the FWC to exclude persons for the purposes of an agreement in certain circumstances if the agreement is a cooperative workplace agreement, single interest employer agreement, or supported bargaining agreement. It would also vary an existing cooperative workplace agreement to add employers and employees.41

Single interest employer authorisations and agreements

1.44
The bill would remove certain limitations on access to single interest employer authorisations and simplify the process for obtaining them. The proposed amendments would also enable single interest agreements to be varied to remove an employer and affected employees from coverage. The bill would:
remove the requirement for two or more employers with common interests who are not franchisees (or otherwise single interest employers) to obtain a ministerial declaration before applying for a single interest employer authorisation;
provide for employee bargaining representatives to apply for a single interest employer authorisation to cover two or more employers, subject to majority support of the relevant employees;
permit employers and employee bargaining representatives to apply to vary a single interest employer authorisation to add or remove the name of an employer from the authorisation, subject to specific requirements; and
insert a new provision to permit employers and employee organisations covered by existing single interest employer agreements to apply to the FWC to extend coverage of that agreement to the new employer and its employees, subject to meeting specific requirements.42

Arbitration of intractable bargaining disputes

1.45
The bill would increase scope for the FWC to provide effective assistance to parties to resolve intractable bargaining disputes. It would repeal the current serious breach declarations and bargaining related provisions in the FW Act and introduce a new intractable bargaining declaration scheme. The new arrangements would allow the FWC to issue an intractable bargaining declaration if it is satisfied, among other things, that there is no reasonable prospect of the parties reaching agreement.43

Termination of enterprise agreements

1.46
The bill would amend the FW Act and the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009 (FW Transitional Act) to clarify that the FWC can only terminate an enterprise agreement that has nominally expired on the unilateral application of a party in limited circumstances.44 The proposed amendments would require the FWC to terminate an enterprise agreement that has passed its nominal expiry date if it is satisfied the:
continued operation of the agreement would be unfair to employees;
agreement does not, and is not likely to, cover any employees; or
continued operation of the agreement would pose a significant threat to the viability of the employer's business.45

Sunsetting of 'zombie agreements'

1.47
The bill would amend the FW Transitional Act to provide for the sunsetting of all remaining agreement-based transitional instruments, state employment agreements and enterprise agreements made during the 'bridging period' for the FW Act.46

Changes to the Better Off Overall Test (BOOT)

1.48
In order to address concerns about the complexity of the current process for approving enterprise agreements, the bill would simplify and clarify the operation of the BOOT. Specifically, it would:
require the FWC to consider the views of specified persons and give primary consideration to any common views expressed by the specified bargaining representatives;
clarify that the BOOT must be applied as a global assessment, not a line-by-line comparison between the proposed agreement and relevant modern award;
require the FWC to only have regard to patterns or kinds of work, or types of employment that are reasonably foreseeable at the time the BOOT was applied; and
enable the FWC to directly amend or excise a term in an agreement that does not otherwise meet the BOOT.47
1.49
The proposed amendments would also enable the BOOT to be reassessed if there has been a material change in working arrangements or the relevant circumstances were not properly considered during the approval process.48

Approval of enterprise agreements

1.50
The bill would simplify the approval requirements for enterprise agreements by replacing most pre-approval requirements with a more flexible principles-based requirement for the FWC to be satisfied that an enterprise agreement has been genuinely agreed to by the employees covered by the agreement. Specifically, the bill would:
remove the various steps that an employer must currently take within strict timeframes, including the requirement to provide employees with access to the agreement during a seven day 'access' period;
remove the requirements to provide a Notice of Employee Representational Rights (NERR) and to wait until at least 21 days after the last NERR before requesting employees to vote on the agreement;
replace pre-approval requirements with a broad requirement for the FWC to be satisfied that an enterprise agreement has been genuinely agreed to by the employees covered by the agreement.49

Initiating bargaining – single enterprise agreements

1.51
The proposed amendments would simplify the process for initiating bargaining by permitting an employee bargaining representative to initiate bargaining where the proposed qualifying single-enterprise agreement would replace an existing agreement that has a nominal expiry date within the past five years and has a scope substantially like the proposed agreement.50

Protected industrial action

1.52
The bill would establish a panel of ballot providers who are 'pre-approved' to conduct Protected Action Ballots (PAB). It would empower the FWC to require bargaining representatives to attend a conciliation conference during the PAB period and enable the FWC to conduct the conference within a 14-day period before voting closes on the PAB.51 It would also include a new notice requirement (120 hours) before commencing protected industrial action for single interest employer and supported bargaining agreements.52

Dealing with errors in enterprise agreements

1.53
The bill would enable the FWC to vary enterprise agreements to correct or amend obvious errors, defects, or irregularities. It would also enable the FWC to validate a decision to approve an enterprise agreement or variation, in circumstances where the wrong version of the document was inadvertently submitted to the FWC for approval.53

Improving job security and gender equality

1.54
The bill seeks to implement a series of reforms designed to improve job security and gender equality for workers, with a particular focus on employees in low-paid sectors and ensuring that women can participate more easily in the workforce.

Objects of the FW Act

1.55
The bill would amend the FW Act to include job security and gender equality in the objects of the FW Act, the modern award objective, and the minimum wage objective. It would require the FWC to take the objects of the FW Act into account when performing functions or exercising its powers under the Act.54

Limiting the use of fixed-term contracts

1.56
The bill would insert new provisions into the FW Act to prohibit an employer from engaging an employee on a fixed-term contract for the same role beyond two years (including renewals) or on a contract which may be extended more than once, whichever is shorter. The provisions would prohibit the use of a third or more fixed-term contract where an employee has previously been engaged on two consecutive contracts for the same or similar work. For the prohibition to apply, there must be substantial continuity between all three or more of the contracts. The prohibition would apply when the employment relationship exceeds two contracts, even if it does not exceed two years in duration.
1.57
The FWC would be empowered to resolve disputes regarding an employee's status as a fixed term employee, including by consent arbitration. Employees would also be able to access the small claims jurisdiction in eligible courts to enforce the legislative provisions. These provisions will commence 12 months after the bill receives Royal Assent.55
1.58
The bill contains nine relatively broad exceptions to the limitations, including where:
an employee is engaged to perform a distinct and identifiable task involving specialised skills;
the employee earns more than the high income threshold;
they are engaged under a training arrangement;
they are engaged in essential work during peak demand;
they are engaged during the temporary absence of another employee; or
if their employment is funded by government funding for more than two years, where there is no reasonable prospect that the funding will be renewed.56

Prohibiting sexual harassment in connection with work

1.59
The bill would implement recommendation 28 of the Respect@Work report by inserting an express prohibition on sexual harassment in connection with work into the FW Act, which would:
apply to workers, prospective workers and persons conducting businesses or undertakings;
create a new dispute resolution function for the FWC that would enable people who experience sexual harassment in connection with work to initiate civil proceedings if the FWC is unable to resolve the dispute; and
merge the existing stop sexual harassment order jurisdiction into new Part 3-5A of the FW Act to ensure all provisions dealing with sexual harassment are located together and streamline the processes for applicants.57

Expert panels

1.60
The bill would establish a Pay Equity Expert Panel and a Care and Community Sector Expert Panel within the FWC to determine equal remuneration cases and certain award cases. It would also allow for the appointment of members with expertise in gender pay equity, anti-discrimination, and the care and community sector.58

Equal remuneration

1.61
In relation to equal remuneration and work value cases, the bill would amend the FW Act to require that the FWC's consideration of work value reasons be free of assumptions based on gender and include consideration of whether there has been historical gender-based undervaluation of the work under consideration. Specifically, the proposed amendments would:
provide examples of matters the FWC may take into account when deciding whether there is equal remuneration for work of equal or comparable value;
clarify that evidence of a 'male comparator' is not required for the FWC to grant an Equal Remuneration Order (ERO); and
allow the FWC to make an ERO on its own initiative as well as on application and would confirm that the FWC is not required to find discrimination based on gender to grant an ERO.59

Prohibiting pay secrecy

1.62
The bill would insert new provisions into the FW Act to provide employees with a positive right to disclose (or not disclose) information about their remuneration and any related terms and conditions of their employment to any other person, as well as to ask other employees about their remuneration and other related terms and conditions of their employment.60

Flexible working arrangements

1.63
The bill would amend the FW Act to expand the circumstances in which an employee may request flexible work arrangements, to include situations where an employee, or a member of their immediate family or household, experiences family and domestic violence. The proposed amendments would also amend the procedure for dealing with requests for flexible work by expanding the employer's obligations to:
discuss a request for a flexible work arrangement with the employee;
provide reasons for any decision to refuse the request; and
if the request is refused, inform the employee of any changes in working arrangements the employer is willing to make that would accommodate the employee's circumstances.61
1.64
The FWC would be empowered to resolve disputes regarding flexible work arrangements where the employer refuses the employee's request or does not respond to the employee's request within 21 days. This includes by mandatory arbitration where the employer refuses the employee's request or does not respond to the employee's request within 21 days. Contraventions of the flexible work provisions in Division 4 of Part 2-2 would be a civil remedy provision under section 44 of the FW Act.62
1.65
The FWC would not be permitted to make an order that would be inconsistent with a provision of the FW Act or a fair work instrument that applies to the employee and employer (other than a previous order made by the FWC under these provisions).63

Improving workplace conditions and protections

1.66
The bill would make several changes designed to strengthen workplace conditions and protections for workers, including additional anti-discrimination measures in the workplace, increasing the amount of unpaid entitlements workers can recover through the small claims process, and prohibiting job advertisements with unlawful rates of pay.

Anti-discrimination and special measures

1.67
The bill would add three further protected attributes—breastfeeding, gender identity and intersex status—to the existing provisions that provide protections against discrimination. The bill would confirm that 'special measures to achieve equality' are matters pertaining to the employment relationship and therefore matters about which an enterprise agreement may be made and that 'special measures to achieve equality' are not discriminatory terms and therefore not unlawful terms in an enterprise agreement.64

Enhancing the small claims process

1.68
The bill would increase the monetary cap on the amounts that can be awarded in small claims proceedings under the FW Act from $20 000 to $100 000. The proposed amendments would also enable the court, in a small claims proceeding, to award a successful claimant any filing fees they paid to the court as costs, from the other party.65

Prohibiting advertisements with a pay rate that would contravene the FW Act

1.69
The bill would insert a new provision prohibiting national system employers from advertising employment at a rate of pay that would contravene the FW Act or a fair work instrument. The new provision would require advertisements of piecework to include any periodic rate of pay to which the pieceworker would be entitled. Employers would not contravene the provision if they had a reasonable excuse for not complying.66

Workers' compensation presumptions for firefighters

1.70
The bill would amend existing presumptive liability provisions in subsection 7(8) of the Safety, Rehabilitation and Compensation Act 1988 (SRC Act) to reflect the outcomes of the Review of the Firefighter Provisions of the Safety, Rehabilitation and Compensation Act 1988. The new provision would outline the circumstances in which employees are taken to have been employed as a firefighter for the purposes of the Act.67 The bill would clarify that employees covered by paragraph 7(9)(a)(i) of the SRC Act are taken to have been employed as a firefighter during any period in which they were a member of a firefighting service.68 The bill would also amend section 5 of the SRC Act to update the references to the emergency services legislation of the Australian Capital Territory included in the SRC Act.69

Abolition of the ABCC and the ROC

1.71
The bill would amend the BCIIP Act to abolish the ABCC and repeal the Code for the Tendering and Performance of Building Work 2016, while transferring the ABCC's remaining functions to the Fair Work Ombudsman. The bill would retain provisions of the BCIIP Act that establish the Federal Safety Commissioner and the Work Health and Safety Accreditation Scheme.70 The bill also proposes to amend the FWRO Act to abolish the ROC and transfer its regulatory functions to the FWC.71

Financial implications

1.72
The explanatory memorandum notes that the government has committed $111.6 million over four years to support the implementation of the measures contained in the bill.72 In its submission, the department indicated that the abolition of the ABCC 'will deliver a saving to the budget of $130.9 million over the forward estimates from 2022–23'.73

Consideration by other parliamentary committees

1.73
When examining a bill, the committee considers any relevant comments published by the Senate Standing Committee for the Scrutiny of Bills (Scrutiny Committee) and the Parliamentary Joint Committee on Human Rights (Human Rights Committee).
1.74
At the time of writing, neither the Scrutiny Committee nor the Human Rights Committee had considered the bill; however, the statement of compatibility with human rights, included in the bill's explanatory memorandum, concluded that the bill is compatible with the Human Rights (Parliamentary Scrutiny) Act 2011 because it 'promotes human rights, including civil, political, social, economic and labour rights. To the extent that it may limit human rights, those limitations are reasonable, necessary and proportionate'.74

Conduct of the committee's inquiry

1.75
On 27 October 2022, the Senate referred the bill to the committee for inquiry and report by 17 November 2022. On 17 November 2022, the committee presented a progress report requesting that the Senate grant an extension of time to report until 22 November 2022.
1.76
The committee advertised the inquiry on its website and invited submissions by 11 November 2022. The committee received 96 submissions which are listed at Appendix 1 of this report. The public submissions are available on the committee's website.
1.77
The committee held five public hearings:
Sydney – Friday, 4 November 2022;
Canberra – Friday, 11 November 2022;
Melbourne – Monday, 14 November 2022;
Melbourne – Tuesday, 15 November 2022; and
Canberra – Tuesday, 22 November 2022.
1.78
A list of the witnesses who gave evidence at the hearings is included at Appendix 2.
1.79
The committee thanks those individuals and organisations who contributed to this inquiry by preparing written submissions and giving evidence at the public hearing.

Notes on references

1.80
References in this report to the committee Hansard are to the proof Hansard. Page numbers may vary between the proof and official transcripts.

  • 1
    Department of Employment and Workplace Relations, Enterprise Bargaining outcomes from the Australian Jobs and Skills Summit, Regulation Impact Statement (Regulation Impact Statement), p. 3.
  • 2
    Australian Government, Budget October 2022–23: Building a better future, October 2022, p. 51.
  • 3
    Australian Government, Budget October 2022–23: Building a better future, October 2022, p. 27.
  • 4
    Australian Government, Budget October 2022–23: Building a better future, October 2022, p. 19.
  • 5
    Australian Government, Budget October 2022–23: Building a better future, October 2022, p. 19.
  • 6
    Australian Government, Budget October 2022–23: Building a better future, October 2022, p. 19.
  • 7
    The Treasury, Jobs and Skills Summit, https://treasury.gov.au/employment-whitepaper/jobs-summit (accessed 31 October 2022).
  • 8
    Department of Employment and Workplace Relations, Submission 49, p. 4.
  • 9
    Prime Minister of Australia, Media Release, 2 September 2022, https://www.pm.gov.au/media/ outcomes-jobs-and-skills-summit (accessed 1 November 2022).
  • 10
    Much of the information contained within this section has been sourced from the regulation impact statement (RIS) included with the bill's explanatory memorandum.
  • 11
    Regulation Impact Statement, p. 4.
  • 12
    Regulation Impact Statement, p. 4.
  • 13
    Regulation Impact Statement, p. 4.
  • 14
    Regulation Impact Statement, p. 4.
  • 15
    Stagflation is an economic term used to describe economies simultaneously experiencing slow economic growth, high unemployment, and high inflation.
  • 16
    Regulation Impact Statement, p. 7.
  • 17
    Regulation Impact Statement, p. 7.
  • 18
    For more information on each bargaining stream, see pages 5 and 6 of the regulation impact statement which accompanies the bill.
  • 19
    Regulation Impact Statement, p. 3.
  • 20
    Regulation Impact Statement, p. 10.
  • 21
    Regulation Impact Statement, pp. 11–12.
  • 22
    Regulation Impact Statement, p. 10.
  • 23
    Regulation Impact Statement, pp. 10–11.
  • 24
    Regulation Impact Statement, p. 11.
  • 25
    Productivity Commission 2022, 5-year Productivity Inquiry: A more productive labour market, Interim Report, Canberra, October, P. 54.
  • 26
    Australian Institute of Employment Rights, Submission 17, p. 10.
  • 27
    The gender pay gap is measured by differences in average weekly full-time earnings.
  • 28
    Regulation Impact Statement, p. 13.
  • 29
    Regulation Impact Statement, p. 13.
  • 30
    Regulation Impact Statement, p. 13.
  • 31
    Regulation Impact Statement, p. 13.
  • 32
    Regulation Impact Statement, p. 14.
  • 33
    Dr Jim Stanford, Economist and Director, Centre for Future Work, Committee Hansard, 11 November 2022, p. 23.
  • 34
    See, for example, Australian Council of Trade Unions, Submission 47, p. 57; Australian Institute of Employment Rights, Submission 17, pp. 8 and 20; Mr Tom Roberts, Senior Legal Officer, Australian Council of Trade Unions, Committee Hansard, 4 November 2022, p. 31; Per Capita Australia, Submission 14, p. 6.
  • 35
    See, for example, Associate Professor Chris F. Wright, Committee Hansard, 4 November 2022, p. 5; Mr Tom Roberts, Australian Council of Trade Unions, Senior Legal Officer, Committee Hansard, 4 November 2022, p. 31; Centre for Future Work, Submission 18, pp. 14–15.
  • 36
    Regulation Impact Statement, p. 16.
  • 37
    Regulation Impact Statement, p. 16.
  • 38
    Centre for Future Work, Submission 18, p. 23; Transport Workers Union of Australia, Submission 83, p. 3; Australian Council of Trade Unions, Submission 47, p. 84.
  • 39
    Explanatory Memorandum, p. 159.
  • 40
    Explanatory Memorandum, pp. 159–170. Once an agreement is made under the proposed supported bargaining stream, it may then be varied to cover additional employers and their employees, subject to certain conditions.
  • 41
    Explanatory Memorandum, pp. 189–192. The new provisions would not apply to bargaining for a greenfields agreement or for an agreement for which a single interest employer authorisation is in operation.
  • 42
    Explanatory Memorandum, pp. 171–188.
  • 43
    Explanatory Memorandum, pp. 143–149.
  • 44
    Currently, under section 225 of the Fair Work Act 2009, if an enterprise agreement has passed its nominal expiry date, an employer, employee, or union covered by the agreement may unilaterally apply to the Fair Work Commission to terminate the enterprise agreement.
  • 45
    Explanatory Memorandum, pp. 116–120.
  • 46
    Explanatory Memorandum, pp. 121–124. A legacy agreement (commonly referred to as a 'zombie' agreement) refers to instruments made prior to the commencement of the Fair Work Act 2009 and during the 'bridging period' between 1 July 2009–31 December 2009.
  • 47
    Explanatory Memorandum, pp. 136–140.
  • 48
    Explanatory Memorandum, pp. 139–140.
  • 49
    Explanatory Memorandum, pp. 125–132. The bill would require the Fair Work Commission to publish a 'statement of principles' containing guidance for employers about how they can ensure employees have genuinely agreed.
  • 50
    Explanatory Memorandum, pp. 133–135.
  • 51
    Explanatory Memorandum, p. 150.
  • 52
    Explanatory Memorandum, pp. 150–158.
  • 53
    Explanatory Memorandum, pp. 141–142.
  • 54
    Explanatory Memorandum, pp. 65–67.
  • 55
    Supplementary Explanatory Memorandum, p. 1.
  • 56
    Explanatory Memorandum, pp. 101–107.
  • 57
    Explanatory Memorandum, pp. 80–96.
  • 58
    Explanatory Memorandum, pp. 71–77.
  • 59
    Explanatory Memorandum, pp. 68–70.
  • 60
    Explanatory Memorandum, pp. 78–79. The proposed measure would apply to all new contract employment contracts or other written agreements entered into (including contracts or agreements that are revised or amended) after the provision comes into effect.
  • 61
    Explanatory Memorandum, pp. 108–112.
  • 62
    Explanatory Memorandum, pp. 112–115.
  • 63
    Supplementary Explanatory Memorandum, p. 19.
  • 64
    Explanatory Memorandum, pp. 97–100.
  • 65
    Explanatory Memorandum, pp. 193–194.
  • 66
    Explanatory Memorandum, pp. 195–197.
  • 67
    Supplementary Explanatory Memorandum, p. 46.
  • 68
    Supplementary Explanatory Memorandum, p. 46.
  • 69
    Explanatory Memorandum, p. 209.
  • 70
    Explanatory Memorandum, pp. 27–64.
  • 71
    Explanatory Memorandum, pp. 5–26.
  • 72
    Explanatory Memorandum, p. iii.
  • 73
    Department of Employment and Workplace Relations, Submission 49, p. 3.
  • 74
    Explanatory Memorandum, p. l.

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