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Autumn 2006

John Howard's Industrial Relations Laws Take Effect

On Sunday 26 March 2006 whilst the nation’s attention was on the Commonwealth Games, the Minister for Workplace Relations, Kevin Andrews released some five hundred plus pages of regulations to accompany the more than one thousand pages of legislation passed by the federal Parliament late last year.

The Workplace Relations Amendment (Workchoices) Act took effect from Monday March 27. A new era of industrial regulation has commenced and the balance of power in workplaces has been shifted dramatically to employers.

The federal Government has promoted the new provisions as a "simplification" of industrial laws. The laws have been described as one simple national system. If more than fifteen hundred pages of legislation and regulations can be described as simplification then we should all be thankful that we do not have a complicated system.

All parties, unions, employers and, in particular, small business will find this legislation difficult to understand and will require a bevy of lawyers to fully understand their rights and responsibilities. The legislation attempts to override state industrial relations systems and move most employees and employers into the federal arena. This matter will be the subject of a High Court appeal that will be heard some time in May of this year.

For our members the legislation may have a direct impact on all members in the private sector. The scope of the legislation seeks to cover all employees working for a constitutional corporation. The legislation envisages about eighty five percent of all employees across Australia will be covered by the Act. Whether workers in Disability Services, Community Services and Nursing Homes are employed by constitutional corporations within the meaning of the constitution is not clear and will be determined by the High Court case referred to earlier.

We do know that the Federal Act will not cover members working in the State Service, they will remain in the State industrial relations system.

The Workplace Relations Amendment (Workchoices) Act 2005 changes the industrial landscape dramatically. The award is no longer the safety net for all conditions and many of the conditions members currently enjoy are under threat.

The Howard Government has legislated just five conditions, which all workers must receive:

• The minimum wage rate for the classification;
• 38 hour week although this can be averaged over twelve months;
• 52 weeks unpaid parental leave;
• 4 weeks annual leave although two weeks of this can be negotiated away; and
• 10 days personal leave which includes Sick Leave, Carer's Leave and Bereavement Leave.

The wage rates will be determined by the newly established "Fair Pay Commission" which will also determine the minimum wage, currently $484 per week or $12.75 per hour. Until such time as the Fair Pay Commission meets and determines wage rates members will continue to be paid their current award rate.

All other conditions currently enjoyed by members are not protected and unscrupulous employers can strip them away. These include shift penalty rates, overtime penalties, roster provisions such as notice of changes, leave loadings etc.

If ever there was a time to join the union it is now. Collectively workers can resist any attempts to remove hard won conditions, individually it is between your bargaining power and the employer's.

HACSU does not expect employers in our industry to rush in and start removing conditions such as penalty rates and the like. Indications in this early stage are that for the time being it will be business as usual. However, the new laws impose considerable burdens on all parties and employers will be required to abide by the laws as much as employees and unions will.

Members are well aware of the financial constraints on employers in our industries. As Disability Services, Community Services and Aged Care all receive federal Government funding it is possible that the Howard Government will link federal funding to industrial relations. In the Higher Education sector they have demanded that Universities offer Australian Workplace Agreements (individual contracts) as a condition of funding. It is more than likely that employers in our industries may be placed under similar pressure.

The federal Government has repeatedly stated that these new laws will result in higher wages and better jobs. The rationale is that there is a labour shortage and workers have the bargaining power. That may be the case at present, but what happens to workers' pay and conditions when the economy starts to slow down and companies look to reduce costs? The removal of workers' rights makes it that much easier to reduce costs by removing conditions of employment.

In effect, the Government is saying that when things are going well workers can have a share but when things turn bad then workers must shoulder an unreasonable share of the pain. Business should have the capacity to maintain their profit level even if it results in workers' pay and conditions being cut.

This is not the fair society that many of us wish to see. The economic benefits and pain should be shared equitably and those who can least afford it should be shielded from the pain of economic downturns.

The Howard Government's dramatic change to workplace regulation is based on a "survival of the fittest" philosophy and leaves the workers with the least bargaining power to the mercy of employers. It is a system which removes fairness from the employment relationship and shifts the power to employers. It is a system which deliberately attempts to deny workers the right to organise collectively and places individual contracts at the forefront of employment regulation.