The Federal Coalition Opposition released its much anticipated employment and industrial relations Policy on 9 May 2013.
The Policy, called The Coalition’s Policy to Improve the Fair Work Laws, does not propose an overhaul of the current industrial relations laws; instead it focuses on changes to the edges of the current system.
It is very much a steady as she goes Policy approach to Australia’s industrial relations framework.
The key aspects of the Policy are set out below.
Productivity Commission Review
The Productivity Commission will be asked by a Coalition Federal Government to undertake a “comprehensive and broad” review of the Fair Work Laws and the impact they have on the economy, productivity and jobs. The Productivity Commission will be tasked with making recommendations on how the Fair Work Laws can be improved.
The Coalition proposes that any changes to the Fair Work Laws will be taken to the following election, making it clear to employers that they should not expect any significant changes to the workplace relations system other than the changes proposed in the Policy.
While this provides certainty for business, some of the more significant changes sought by employers, such as to the adverse action provisions and bargaining, are not on the medium term horizon if there is a change of government.
Fair Work Commission, Road Safety Remuneration Tribunal and ABCC
The Policy flags “improvements” to the Fair Work Commission rather than an intention to do away with the Commission. The Policy states that it is crucial that the workplace relations system is supported by an efficient and modern tribunal which promptly provides effective and consistent decision-making. The Policy also states that a coalition government will give active consideration to the establishment of an independent appeal jurisdiction.
The Policy proposes the re-establishment of the Australian Building and Construction Commission (ABCC), which under the Federal Government became the Fair Work Building & Construction in June 2012. The ABCC will be tasked with responsibility for enforcing legal compliance on building and construction projects both onshore and offshore. The Policy proposes to roll back the Federal Government’s changes to the ABCC, other than in relation to compulsory interview process retaining the Ombudsman’s oversight and videotaping requirements.
The Coalition proposes to ‘urgently’ review the Road Safety Remuneration Tribunal, which sets pay and conditions for the road transport industry.
The Policy proposes that Individual Flexibility Arrangements (IFA) in Enterprise Agreements cannot restrict the use of IFAs. This means that an individual employee can opt to enter into an IFA with their employer because the terms of an IFA will not be able to be restricted by the terms of an Enterprise Agreement.
The Policy makes it clear that IFAs are not intended to be a kind of Australian Workplace Agreement or individual contract and they will continue to operate alongside Modern Awards or Enterprise Agreements.
The Coalition proposes that IFAs will continue to have to meet the Better Off Overall Test currently in place to ensure that there is not, overall, a reduction in an employees terms and conditions under the IFA.
Importantly, the notice period for terminating IFAs will be extended to 13 weeks.
The issue of termination of IFAs has been a major concern for employers, as employees can currently unilaterally terminate the IFA on 28 days written notice.
Union right of entry
The Policy proposes to amend the current union right of entry laws to bring them back to the position under the Workplace Relations Act1. A key difference will be that under the Coalition union officials will only have a right of entry to a workplace if:
- The union is covered by an Enterprise Agreement that applies there;
- The union is a bargaining representative seeking in good faith to make an agreement to apply to the workplace; and
- There is "evidence" that the union has members who have requested their presence.
If a workplace is covered by a Modern Award, or an Enterprise Agreement that does not cover a particular union, access will be allowed only if:
- The union can demonstrate they have or previously have had a lawful representative role in the workplace; and
- There is "evidence" that the workers or members have requested the presence of the union.
The Fair Work Commission will have the power to resolve disputes about the frequency of unions' workplace visits and ensure the "rules are enforced". If rules are breached a penalty "could be imposed".
The Policy does not propose to change right of entry to investigate breaches, represent a member in a dispute over an award or agreement, investigate OHS breaches, and existing outworker provisions.
The Coalition Policy does not adopt the Federal Government proposed changes to make the meal / break room the default area for discussions if agreement cannot be reached with the employer and the permit holder.
The Policy also responds to the Federal Government’s proposed amendments to the Fair Work Act to make workplace bullying a matter to be dealt with by the Fair Work Commission.
The Coalition position on workplace bullying is very similar to the Federal Government’s current position.
The Coalition proposes to address the issue of workplace bullying by requiring that the worker with the bullying complaint first try to seek preliminary help, advice or assistance from an independent regulator (which is likely to be the relevant health and safety regulator such as Worksafe). If a worker has taken this step then the worker will be able to make their complaint to the Fair Work Commission.
Bargaining and industrial action
The Policy proposes to include new requirements in relation to the taking of protected industrial action.
Protected industrial action will only be able to take place after there have been ‘genuine and meaningful’ talks between workers and employers at the workplace during bargaining. The Fair Work Commission will be required to determine when this has occurred.
The Policy proposes that the current provisions requiring that the parties are genuinely trying to reach agreement before a protected action ballot is approved be amended so that the Commission is satisfied that claims made:
- Are not exorbitant, having regard to the conditions at the workplace and the industry in which it operates;
- Are fair and reasonable having regard to the conditions at the workplace and the industry in which it operates; and
- Would not adversely affect productivity.
These changes are likely to lift the bar in terms of what is required to be made out by unions before protected action can be taken.
The Fair Work Commission will also be required to consider whether the parties to an Enterprise Agreement have considered productivity as part of the negotiations. The parties have no obligations other than to consider productivity. It is unclear how this proposal will have any meaningful impact on workplace bargaining.
The Coalition proposes to prevent delays arising from union negotiations in relation to Greenfield Enterprise Agreements (where there are no employees employed at the time of making the agreement) by:
- Introducing ‘good faith bargaining’ rules to cover negotiations for Greenfield agreements – currently good faith bargaining is required in relation to agreements that are not Greenfield agreements;
Requiring agreement to be reached with a union within 3 months of the business starting negotiations. Where agreement isn’t reached within this time the business will be able to take the agreement to the Fair Work Commission for approval. The agreement must satisfy the following tests in order to be approved:
- it must meet the Better Off Overall test and Public Interest Test; and
- the pay and conditions in the proposed Greenfields agreement must be consistent with the prevailing standards and conditions within the industry for equivalent work. The Policy does not provide any guidance on what “prevailing” standards and conditions are or how they may be determined.
In addition, a business will only need to negotiate a Greenfield agreement with a union that will cover the majority of workers to be employed on the site and the Fair Work Commission will make that union a party to the Agreement if it is approved.
Paid Parental Leave Scheme
A Coalition Federal Government will provide mothers with 26 weeks of paid parental leave, at full replacement wage or the national minimum wage, whichever is greater – plus superannuation.
What does it all mean?
For most businesses the Coalition workplace relations agenda will not involve any meaningful change in relation to your legal risks relating to employment litigation (particularly adverse action and unfair dismissal) and is aligned to the Federal Government’s own approach to making workplace bullying an industrial relations issue.
For businesses that have a difficult relationship with unions, particularly industrial disputation risks, there are some improvements to protected industrial action proposed – but these changes will not substantially alter the existing framework. Similarly, in relation to agreement making the Coalition is proposing amendments that will assist around the edges of the current agreement making requirements.
All in all, it will largely be business as usual (as it is now) under a Coalition government in the area of industrial relations.