Final modern awards welcomed, but employers say they are ‘unfair’


Final modern awards welcomed, but employers say they are ‘unfair’

The AIRC’s completion of the modern award process has been welcomed by the Federal Government, but has had a mixed response from employer organisations — with one describing it as ‘quite unfair’.


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The AIRC’s completion of the modern award process has been welcomed by the Federal Government, but has had a mixed response from employer organisations — with one describing it as ‘quite unfair’.
ACCI chief executive Peter Anderson said the finalised awards allay ‘some but not all of the concerns of industry’.
He said the decision not to extend industrial award regulation to managerial and professional staff not historically covered by awards ‘is welcome and sensible’.
Mixed bag
‘However, the final result of award modernisation is a mixed bag for employers,’ Anderson said.
‘In terms of quantity of awards, the reduction in numbers due to amalgamations and rationalisation is to be commended.’
‘In terms of content, the prospects for employers in some states in some key industries like retail, restaurants and pharmacy are quite unfair.’
‘Four years of higher wages’
‘For these businesses, they face four years of higher wages, penalty rates, allowances and loadings not because staff will work differently but because state-specific rules have been nationalised.’
Anderson said that while the process has been described as award modernisation, the AIRC was not in a position to review the merit of individual award rules (like penalty rates) to assess whether they reflected the best form of employee compensation in modern, seven-day service industries.
‘There are also obligations on employers to ensure no employee is worse off in the new regulatory mix, but no similar protection for employers — simply the phasing-in of labour cost increases,’ he said.
Significant ‘dampener’
‘While the overall body of industrial award regulation will be in better shape because of award modernisation, the impact on jobs and small business viability from labour cost increases that were promised would not occur, remains a significant dampener on what has otherwise been a useful regulatory clean-up.’
The Australian Industry Group (Ai Group) was far less critical, saying the AIRC had addressed the major concerns it had expressed.
Important aspects
Ai Group chief executive Heather Ridout said that the final Stage 4 modern awards now incorporated the following very important aspects:
  • Unlike the earlier draft, the Miscellaneous Modern Award will not cover professional employees.
  • The Miscellaneous Modern Award will now expressly exclude ‘those classes of employees who, because of the nature or seniority of their role, have not traditionally been covered by awards including managerial employees and professional employees such as accountants and finance, marketing, legal, human resources, public relations and information technology specialists’.
  • Accounting practices will not be covered by a modern award.
  • All modern awards will contain a clause clarifying the coverage of on-hire employees similar to a draft clause submitted by Ai Group.
  • A modern award will not be made for the employment services industry or the group training industry, as argued by Ai Group. The earlier draft award will be modified to limit its application to the labour market assistance sector. Group apprentices and trainees will be covered by the award applicable to the industry in which they are placed.
Complex task
‘Award modernisation is a massive and extremely complex task, with very tight timeframes,’ Ridout said.
‘Ai Group commends the Commission for the consultative approach which it has taken.’
IR Minister Julia Gillard said that as a result of the award modernisation process, the AIRC has reduced the number of awards and instruments from more than 4000 to only 122.
‘Both employers and employees will benefit greatly from the reduced complexity and red tape through the introduction of simple, modern awards,’ she said.
Profound economic reform
‘The Government has delivered a profound economic reform for Australian employers and employees, a reform that has defeated successive governments for several decades.’
‘The Government understands that modernising and simplifying our award system has been a huge and a difficult job, but it is a job that needed doing to ensure this nation moves forward with fairness.’
Gillard welcomed the AIRC’s decision to clarify that the Miscellaneous Award will not apply to certain categories of employees who have not been traditionally covered by awards.
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