Employers welcome IR detail, but doubts remain (1)


Employers welcome IR detail, but doubts remain (1)

Employers have generally welcomed the further detail released by IR Minister Julia Gillard on Labor’s IR system, but still have concerns about unfair dismissal laws and the scope of ‘good faith’ collective bargaining.


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Employers have generally welcomed the further detail released by IR Minister Julia Gillard on Labor’s IR system, but still have concerns about unfair dismissal laws and the scope of ‘good faith’ collective bargaining.

The ACTU has been guarded in its acceptance of the policy details, while the Greens have dismissed Labor’s plans as ‘a continuation of WorkChoices’.

Australian Industry Group chief executive Heather Ridout said business welcomed the fact that:

  • restrictions will remain on the content of bargaining claims, rather than being totally unfettered as sought by the unions

  • good-faith bargaining obligations will be procedural in nature and the new body, Fair Work Australia, will not have the power to force a party to make concessions

  • there will be no right to take industrial action or access compulsory arbitration for multiple-business agreements

  • the ability to vary awards outside of four yearly reviews will be very limited

  • a Minimum Wage Panel will be established within Fair Work Australia, drawing on the best elements of the past wage setting approaches of the Australian Industrial Relations Commission and the Australian Fair Pay Commission

  • The Fair Dismissal Code for small businesses will be short and easily applied.

Business concerns

However, Ridout said there were concerns about:

  • The Government’s proposals regarding access to compulsory arbitration of disputes remain on the face of it too broad.  This is a major concern for industry.  If this is not appropriately resolved there is a potential for arbitrated outcomes to flow-on across industries.

  • There is a lack of clarity about which workers will be included for the purposes of good faith bargaining rights and obligation, for example, will blue-collar unions be able to obtain bargaining rights for professional and administrative staff if they obtain the support of the majority of the total number of employees in an enterprise?

  • As well, in relation to multiple-business agreements, the removal of the existing restrictions has the potential to substantially reduce the scope for genuine enterprise bargaining in some industry sectors.

Unfair dismissal plans ‘ambitious’

‘The Government’s desire to have in place the unfair dismissals and bargaining arrangements by the middle of 2009 appears very ambitious,’ she said. ‘This is particularly so given that Fair Work Australia and the new award system will not be in place and that the proposed reforms will require a massive education effort for business and industry.’

Risk in ‘collective’ approach

Peter Anderson, chief executive of ACCI, said the risks in Gillard’s announcement ‘lie in the almost exclusively collective approach’.

‘Whether this works in an era of much lower unionisation is debatable,’ he said. ‘The prospect of union claims for changes to union entry, safety matters forming part of industrial relations disputes and ambiguity on what may be included in future workplace agreements and the subject of strikes are particular concerns.'

‘Unless the proposed Code works, small business will gain no confidence from being re-exposed to unfair dismissal claims. Draft new industrial awards would impose higher costs on doing business.’

Anderson said it was disappointing there had not been progress on the States referring their remaining IR powers to the Federal Government to create a national system.

Intergovernmental gridlock

‘The initiative seems to have struck intergovernmental gridlock,’ he said.

The ACTU welcomed the fact that Australian workers will have a right to genuine collective bargaining, union representation and other protections.

It was also pleased that workers will regain protection from unfair dismissal, a fairer system of setting minimum wages, and the regular review of awards and minimum employment standards.

However, ACTU president, Sharan Burrow said unions are concerned that Labor’s new independent umpire, Fair Work Australia, will not have sufficient powers to settle disputes.

‘This could particularly disadvantage low paid workers by fettering multi-employer bargaining,’ she said. ‘In most cases, employers and workers will be able to reach agreement without any intervention from the independent umpire.'

Resolve disputes

‘But in a small number of cases, as a last resort the umpire will need the power to step in and resolve disputes.'

‘We welcome the fact that Fair Work Australia will be able to ensure that collective bargaining occurs and that parties can be directed to engage in the process of bargaining.'

‘This will bring an end to the type of unfair behaviour we have seen in recent weeks from employers like Telstra, Cochlear, Maxitrans and Pilbara Iron.’

Burrow said an area of remaining concern was the restrictions on the scope of bargaining and the content of agreements which appeared to be based on an outmoded concept of matters pertaining to the employment relationship.

Reflect changes in society

‘Bargaining should take account of changes in society, reflecting the modern workplace and current issues, such as climate change,’ she said.

The small business body COSBOA said small business could be pleased with the Fair Dismissal Code as it provided a simple checklist for employers to follow.


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