Speak to any politician of many years standing, and they will tell you that politics is about the art of what is possible. The Productivity Commission has taken a leaf out of the old politician's book and has suggested a number of achievable fine tuning type measures for Australian's work place relations system. This is no clarion call for revolutionary change. Without saying so, this Productivity Commission report recognises the white hot politics of workplace relations in Australia. It has sought to chart a minimalist course without being too controversial. The real interest arising from the Report will be the reaction of Australia's employer groups, trade unions and major political parties. It would be a sad indictment of our political system generally if common ground cannot be found within this Reports' recommendations which are modest, sensible and seek to eliminate some of the more unfortunate and unwarranted aspects of our existing workplace relations system.
For example, the Report recommends that abuses with respect to notified protected industrial action be subject to limitation. It unfortunately has become an aspect of the industrial landscape that an organised group of employees will give notice of protected industrial action only to call it off at the last moment. This is a cause of great cost and disruption and is an indefensible abuse of the system that protects industrial action. It is a sensible development to deal with this issue. Further, at the present time an employer can suffer a wide range of different types of protected industrial action but is left with only one response, and that is the lock out. The Productivity Commission is seeking guidance on more graduated employer response and how that can be defined in statute. In short, the Productivity Commission is recognising that the current single response of a lock out is so extreme as to be unlikely to be used, thus leaving an employer relatively defenceless in the face of concerted industrial attack. Again a very sensible and modest suggestion aimed at creating balance.
Interestingly, with respect to enterprise agreements, the Productivity Commission is open to extending the life of greenfields agreements to match a project's life. For the infrastructure projects on the drawing board in states such as New South Wales, this is good news. It is good news because it stops the project being held to ransom mid-project simply because enterprise agreements have expired. Not only will such projects receive financial certainty it will have a positive affect upon employment security.
The Productivity Commission has taken an interesting view of enterprise agreements. It notes that for many small employers, who employ a large number of persons in Australia, enterprise agreements are simply not relevant. The Commission is seeking further information about the gap between an individual arrangement and enterprise agreements while it considers whether or not to introduce a new industrial instrument, an enterprise contract. Such a contract would not have all of the formal requirements normally associated with an enterprise agreement. This is a sensible idea which is worth further thought.
Perhaps the most significant recommendation is on penalty rates. The recommendation has been limited to the hospitality and entertainment industry and provides that Sunday penalty rates be set at the corresponding Saturday rate. Penalty rates for the rest of the work force are thus left untouched. This is not a world ending suggestion. Rather it is a modest modification of the existing regime which is not working in the hospitality, restaurant and café industry. It will increase the potential for employment on Sundays.
Perhaps where the Productivity Commission has been slightly bolder has been in the area where significant controversy has existed, namely unfair dismissals. There is probably not a business in the country which has not suffered an unfair dismissal claim. The Productivity Commission recommends that the Fair Work Commission should focus more on the merits of the decision to terminate employment rather than procedural errors. They recommend that the emphasis on reinstatement be removed and that Fair Work Commission should apply more up front filters to remove unmeritorious claims. These are propositions which are long overdue.
Perhaps the most curious aspect of this Report relates to productivity. After all, it is a Productivity Commission Report and one might expect that productivity may receive significant attention. Draft Finding 15.1 states that the case for including mandatory productivity clauses in agreements is not strong but is light on reasoning as to why. Productivity is potentially controversial because it often operates within the paradigm of an increase in efficiency corresponds with a diminution in wages or conditions. Clearly the old politician would mark this under the heading of what is not possible and the Commission has steered itself away from this subject.
This Report is not designed to create winners or losers. The Commission's view is that the system is not broken but it does need repairs. Cleverly it has presented a small target for attack by sectional interests so it will be interesting to observe over the coming days and weeks how these interests respond to this Report.