WorkChoices hits low-skilled workers hard: major study


WorkChoices hits low-skilled workers hard: major study

The most-detailed study yet of the effect of WorkChoices on employees, with 8,343 people interviewed, shows the new IR laws have hit low-skilled workers hard.


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The most-detailed study yet of the effect of WorkChoices on employees, with 8,343 people interviewed, shows the new IR laws have hit low-skilled workers hard.

The study, Australia@Work, shows that highly skilled workers do better because they have a stronger capacity to bargain for wages and conditions. It was done by the Sydney University Workplace Research Centre and funded by the Federal Government's Australian Research Council, and Unions NSW.

'Particularly striking was our finding that skill level seems to be clearly linked to bargaining power: whilst highly skilled workers fared best on individual common law contracts, low skilled workers did best when they were covered by a collective agreement,' said lead researcher, Dr Brigid van Wanrooy.

No position to negotiate

'The study confirms that workers in a position to bargain are relying on common law contracts to provide flexibility, as they always have. On the other hand, AWAs are being introduced for workers who are in no position to negotiate their pay and conditions. Low skilled employees on AWAs are earning some of the lowest wages, working the longest hours, and are more likely to want fewer hours of work.'

Dr van Wanrooy said the results show some employers have already moved to side-step the safety net for working Australians that has operated through the award system.

'From now on, when we talk about the benefits of WorkChoices for working Australians we need to clearly distinguish between those who are able to benefit from direct negotiation and workers who rely on the safety net and collective bargaining.'

The study - the first to gather a statistically significant number of workers on AWAs since WorkChoices - also collected information on working hours, union membership, and attitudes about work.

Report 'damning', says ACTU

ACTU President, Sharan Burrow, said the report was 'damning' and shows WorkChoices is taking Australia in the wrong direction.

'The report shows that under WorkChoices workers have little individual bargaining power and no protection from unfair dismissal,' she said. 'It finds that millions of Australian workers are being pushed onto AWAs with inferior pay and conditions.

'The report is clear evidence that WorkChoices is destroying Australia's 100-year-old system of industrial relations that protected workers and encouraged economic growth.'

'Human story behind WorkChoices'

Unions NSW Secretary, John Robertson, said more than 8,000 randomly sampled ordinary people 'cannot be wrong'.

'These people are the human story behind WorkChoices,' he said. 'Low skilled, low paid Australian workers have gone backwards in the last 12 months. Australians are working longer, harder and many of them, for less money.'

Hockey attacks credibility

Workplace Relations Minister, Joe Hockey, tried to cast doubt on the credibility of the report which he said had been produced by 'union-friendly academics'.

'I will note that it was commissioned only recently and it was meant to be four-year research, but these former trade union officials who are parading as academics suddenly release it just before the election,' he told ABC radio. 'You have to look at their motives, and sure enough you can identify what their real intentions are.'

He said there had been some 14 'union-funded, union-commissioned' reports into WorkChoices. Hockey has attacked the authors of all of them.

'The fundamental fact is, according to the Australian Bureau of Statistics, that people on Australian Workplace Agreements earn nearly twice as much as people on awards,' he told ABC radio. 'Now, the unions can commission as much research as they want from union-friendly academics who have previously done a lot of work for the ACTU.

'But, at the end of the day, real wages, that is wages in people's pockets, have increased by more than 3% since we introduced WorkChoices and 417,000 new jobs have been created of which 85% are full-time.'

Federal Treasurer, Peter Costello, said the study was 'contaminated' and lacks credibility because it was funded by unions who want a change of government.

Key findings

The key findings of the report are:

Australians' working lives

Employees are feeling workload pressures: more than half (52%) say that more and more is expected of them for the same amount of pay.

More than half (52%) of Australian workers say they are finding it difficult to get by, or just coping, on their current household income.

Bargaining position

In general, high skilled employees* earn most on common law contracts.

In general, low skilled workers** earn most when covered by collective agreements.

Employees on AWAs, for the most part, earn less than those on common law contracts and collective agreements, but they are working longer hours.

Employees whose pay and conditions are set by awards and collective bargaining work the shortest full-time hours.

AWAs and the new agreement-making

Since WorkChoices there has been a 2.3% decline in employees reliant on awards, and a similar degree (1.7%) of growth in those covered by AWAs.

Employees who changed jobs in the year after WorkChoices were almost twice as likely to be covered an AWA than those who stayed in the same job.

The total number of employees on AWAs grew by 33% in the year after WorkChoices.

Those on the new AWAs are more likely to be young workers (36% aged 16- to 24-years) and in low skilled jobs (56%), and say they do not have the opportunity to negotiate their pay with their employer (56%).

46% of all workers on AWAs say they do not have the opportunity to negotiate pay with their employer.

The study also finds:

As in the past, the largest group (40%) of employees still rely on awards.

The bulk of individual bargaining is still occurring through individual common law contracts (almost one in five employees are covered by these contracts).

Around one in twenty (5.6%) employees are on AWAs. This equates to 450,000 employees.

* For example, managers, professionals and tradespersons
** For example, labourers, shop assistants, child care workers


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