Code of practice needed for bargaining, says BCA

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Code of practice needed for bargaining, says BCA

The Business Council of Australia has called on the Federal Government to issue a code of practice for good faith bargaining to clear up uncertainties in how it should operate.

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The Business Council of Australia (BCA) has called on the Federal Government to issue a code of practice for good faith bargaining to clear up uncertainties in how it should operate.
 
‘Without this it could take several years of experience before the new laws deliver the workplace productivity benefits envisaged by the government,’ said BCA chief executive Katie Lahey.
 
A BCA discussion paper on the matter, Embedding Workplace Collaboration: Good Faith Bargaining, was launched today.
 
Requirements not clear
 
‘The new Fair Work Act seeks to improve fairness and productivity through collective agreements arrived at by good faith bargaining negotiations,’ Lahey said.
 
‘But what will be required under good faith bargaining is not entirely clear.’
 
‘It is not clear, for example, how much information must be provided by employers to parties in a negotiation, or what specifically will be regarded as capricious or unfair behaviour.’
 
‘It will not help the nation to lift its productivity growth, as the Prime Minister has called for, if negotiations between employers and employees are constantly before the workplace umpire because of disagreements about what the laws require.’
 
Formal guidance
 
Lahey said the government should provide more formal guidance on how it expects good faith bargaining to be applied in a way that meets Australian needs and imperatives.
 
‘Without further clarity, good faith bargaining could easily become leap of faith bargaining,’ she said.
 
‘This will do nothing to help our workplaces make the contribution to productivity growth that will be required to meet the Prime Minister’s objectives.’
 
Embedding Workplace Collaboration: Good Faith Bargaining incorporates a paper by Professor Breen Creighton, an industrial relations expert and adviser to the BCA.
 
Prof Creighton argues Australia needs a good faith bargaining model that is tailored to meet local conditions, and not a model imported from another country.
 
‘More sophisticated approach’
 
He says the Fair Work Act represents an attempt to learn from past experiences internationally and domestically to provide legislative support for collaborative workplace relations. As such, it is more sophisticated than previous attempts to give legislative effect to the good faith principle in Australia.
 
Prof Creighton says that legislation can play only a limited role in developing a more collaborative workforce culture. The real key is the commitment of the parties.
 
The paper notes that overseas experience and International Labour Organisation standards offer only limited assistance in guiding good faith bargaining in Australia.
 
Prof Creighton says that while many consider the United States to be an international benchmark in understanding what good faith bargaining means, in practice there are several reasons why this should not provide the template for Australia.
 
Complex, litigious
 
He says this is because good faith bargaining in the United States is excessively complex, highly litigious and has insufficient focus on producing timely outcomes. Collective bargaining in the United States also applies only to a small proportion of the workforce.
 
‘Our paper highlights that legislation by itself cannot produce constructive relationships in the workplace,’ Lahey said.
 
‘Productivity will be determined by how the parties in good faith bargaining negotiations approach the task.’
 
‘Ultimately, the test of the new workplace relations laws will be their contribution to productivity growth as well as to greater fairness.’
 
‘The government has a clear role and investment in providing formal guidance now that will minimise any misunderstanding in how to approach good faith bargaining. Taking a leap of faith in negotiations is not the best way to achieve productivity growth.’
 
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