Opposition’s IR Policy: Summary and Reaction

Opposition’s Leader Tony Abbott’s industrial relations policy was released last week, key points from the policy include;

• Restrict union right of entry into workplaces.
• Create a Registered Organisations Commission to police unions and employer groups.
• Lift penalties for registered organisations to match those of corporations.
• Only allow strikes after “genuine and meaningful” discussion on “realistic and sensible claims” and only allow strikes after bargaining formally starts.
• Support a greater role for Individual Flexibility Agreements (IFAs) in collective deals.
• Include a circuit breaker for deadlocked negotiations on major Greenfield projects after three months, so unions cannot unduly hold up major projects in order to satisfy unreasonable demands.
• Introduce an appeal division into the Fair Work Commission (FWC) – this is an important measure as the FWC is widely viewed to be overweight with union-oriented appointees.
• Re-establish the Australian Building and Construction Commission, extending its powers to cover offshore construction and, by implication, the Maritime Union of Australia.
• Scrap the Remuneration Tribunal setting “safe rates” for the trucking industry.
• Enable the Fair Work Ombudsman to advise small business as well as employees.
• Only allow the Fair Work Commission to hear bullying claims after investigations by other bodies.
• Mandate a review of workplace laws by the Productivity Commission.
• Introduce a Paid Parental Leave scheme for over and above the Government scheme (26 weeks on full replacement wage), funded by a 1.5 per cent levy on larger companies.

Penalty rates and unfair dismissal laws will remain and individual contracts will not be restored.

The Coalition will seek a mandate for further change at the 2016 Federal Election, after a Productivity Commission review, pushing the possibility of any major changes to the Fair Work Act out to 2017.

Reaction to the Policy

The Australian Financial Review described the changes as “timid”. Employer groups such as the Business Council of Australia (BCA), the Australian Industry Group (AIG) and the Australian Chamber of Commerce and Industry (ACCI) all welcomed the changes heralded by the policy but criticised the decision to push out any further changes to 2017. ACCI, which represents over 300,000 mainly small-to-medium sized businesses, was particularly critical, with Chief Executive Officer Peter Anderson indicating that:

The proposals are too modest because they do not just retain the framework of the Gillard government’s fair work laws, but also retain much of their content. Small Businesses, the engine room of jobs growth, are Too Big to Ignore but on the whole there’s not a lot for them to be excited about.

Under the policy, important and necessary excesses of union power are pared back but the power of centralised tribunals and one size fits all laws remain. It is a serious disappointment to the non-union sector, especially small business, that individual workplace agreements would still not be not allowed, and that collective bargaining and one size fits all rules would remain the mainstay of the system.

Nor does there appear to be any remediation of unfair dismissal laws on the horizon.

The ACTU on the other hand described the greater role for IFAs as an attempt to “return individual contracts to the heart of the IR system”, raising the prospect of Howard Government-style Australian Workplace Agreements (AWAs).

Employment and Workplace Relations Minister Bill Shorten said that claims of union militancy did not bear any scrutiny because industrial disputes and hours lost to such disputes had fallen under the Labor Government.

The Greens pledged to block any relevant Coalition legislation in the Senate if they retain the balance of power after the 2013 Federal Election.

iHR Australia understands the importance of balanced and fair industrial relations system that provides a baseline and safety net for employers and employees alike. That being said there are some key elements that iHR has observed in successful organisations that see these organisations needing to pay little attention to IR policy as they exceed policy requirements. These elements include:

• A respectful workplace culture that reduces the risk of conflict including workplace bullying
• Effective management practices that promotes open dialogue, clear communication of role expectations and honest, evidence-based feedback on performance
• Fair remuneration with systematic reviews that reflect organisational and employee needs, productivity and ability for the organisation to pay.