Business organisations press for IR reform


Business organisations press for IR reform

Employer organisations have called for reform of the Fair Work system.


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Employer organisations have called for reform of the Fair Work system.
Industrial relations executives from Australia’s State and Territory Chambers of Commerce and Industry and national Industry Associations met on 29 October in Melbourne, under the auspices of ACCI’s Workplace Policy Committee.
A unanimous Statement issued by the twenty employer organisations in attendance resulted.
The organisations expressed a collective determination to call on the government, the parliament, regulators, industry and tribunals to take swift and effective action to remedy problems identified in the Statement, which have emerged during the first 18 months of the Government’s ‘fair work’ system.
ACCI and the business organisations also resolved to conduct an evidence-based review of the Fair Work system to develop solutions to these and other identified problems.
The employer bodies would also bring these issues to light in public debate and work to increase public acceptance of the case for appropriate change to both the operational aspects of the system and its legislative framework.
Review Fair Work
Speaking after the meeting, ACCI chief executive Peter Anderson said:
‘The collective resolve of employer bodies to make the fair work system work effectively and fairly for business is very strong, as is our combined desire to speak out on problem areas and work towards solutions.
Our review of the fair work laws is forward-looking and will examine the contemporary needs of workplaces in the modern economy and labour force, and does not need to cherry-pick the Fair Work laws, WorkChoices or other past systems.
There can be no doubt after today’s meeting of employer representatives that it wholly unrealistic for either the Government, the Opposition or the parliament to refuse to contemplate or rule out making changes that are detracting from labour market efficiency, fairness, and productivity.’
The meeting also discussed building industry industrial relations, discrimination and human rights issues impacting employers, junior and apprentice wages, the soon-to-commence paid parental leave scheme and developments in superannuation.
Fair Work system
The employer groups supported the national nature of the system, but noted that the efficiency gains of the new laws on that score were limited and had been overstated by the government given that well over 80% of the Australian workforce (including every company) was already in the national system prior to the fair work system commencing. Most businesses transitioning in under the fair work laws are employers operating in one jurisdiction only, not multi-state employers.
Members reported that some important elements of the system were operating unfairly or having a prejudicial effect on business efficiency. Although impacts across industry were not uniform, the labour market was holding up despite the re-regulation, not because of it.
Areas of concern included:
  • cost increases and loss of flexibility in some sectors and states from the new awards, despite government promises to the contrary
  • excessive wage demands and increases in collective bargaining that exceed inflation and have not been matched by efficiency and productivity gains, and where some unions have resisted serious dialogue on such matters
  • increased union activism through loose adherence to right-of-entry rules, threats of industrial action, attempts to frustrate an employer’s direct communication with staff, attempts to control the terms of hiring of contractors, and heightened risk of demarcation disputes
  • undue technicality and red-tape in getting bargaining agreements approved
  • regulation making it more difficult to offer existing workforces ongoing employment when a business changes hands but needs to establish more efficient work practices
  • one-size-fits-all minimum engagement rules in some sectors and regions that have cost young people after-school jobs
  • award wage movements in excess of the rate of inflation and, in many sectors, above the levels of business activity, and which limit the capacity for enterprise bargaining to occur
  • a large spike (63%) in the number of unfair dismissal claims, using new ‘adverse action’ claims to bolster unfair dismissal allegations, a return of ‘go-away money’ (in 75% of cases) to settle claims, employers being caught in ‘double jeopardy when sued for unfair dismissal after dismissing staff for OHS breaches or sexual harassment, inconsistent application of the Fair Dismissals Code exposing some small business to claims despite following the Code’s rules
  • inconsistencies and grey areas in the application and interpretation of some aspects of the new awards and national employment standards between industry, tribunals and regulators. Some of these had been ironed out through dialogue or litigation, others remain. Problems include potential new obligations to pay annual leave loading on unused annual leave, when leave is paid out when employment ceases.
More details are available on the ACCI website.
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