Mr GIBBONS (6:02 PM) —I rise in this debate on the Workplace Relations Legislation Amendment (More Jobs, Better Pay) Bill 1999 tonight to speak from two perspectives. As my friend the honourable member for Corangamite has pointed out, I had some 15 years involvement with the trade union movement as a full-time official looking after the hospitality industry in regional Victoria—15 years of my life of which I am extremely proud. I am very proud of the achievements of the trade union movement during that time and I wish them well in the future. The second perspective was as a small business person. Prior to coming to this place in October, I operated a small business specialising in providing advice to other small businesses to sort out the mess the Kennett government made of industrial relations in the state of Victoria and then later on, once the Howard government was elected, to sort out the mess that they had created. I will have a bit more to say about that a little later.

The government claim that these changes are vital to aid the strong economic growth that they so often tell us about. But they do not understand that in regional Australia and in regional Victoria if you take away the purchasing power of salary and wage earners, making them work for less, that lessens their spending power. Remember, these people dispose of all of their income every week or fortnight. If you take away that purchasing power, that impacts on other small businesses and their ability to employ people. So it is a myth that this is going to aid economic growth, especially in regional Victoria.

Another myth that I would also like to highlight is the government's claim to be the champion of small business. As I said, before entering this place I conducted a small business—an industrial relations consultancy and a computerised payroll bureau. I dealt with some 40 or 50 businesses from various sectors. I found that the thing that small businesses need most of all is certainty. They have had anything but that over the last three or four years and, under the old state legislation of Victoria in particular, from well beyond that. They like certainty. In the hospitality industry, some of them were a little bit concerned about the penalty rate system, but it was pointed out to them that, if you take the penalty rate system out of the hospitality industry, it is only a matter of time before all the other industries follow suit. When that happens, the people who work in those industries do not have the purchasing power to dispose of to the hospitality industry. That is the first industry to suffer. Once that is pointed out, they seem to understand. Small business need certainty, and they certainly have not got it.

Again, the government claims to be the champion of small business. When you have a good hard look at it, the government only represents small business associations. The overwhelming majority of small businesses in Australia are not members of an association. Out of roughly 900,000 small businesses identified in the ABS statistics between 1996 and 1997, around 33 per cent are members of small business associations. The rest of them go it alone. So for the government to claim that it is the champion and representative of small business is just a myth, and one that needs to be exposed.

I would like to highlight the impact of this new legislation and the first wave of IR reforms under this government in an industry that you, Mr Deputy Speaker Adams, are certainly very familiar with. I refer to the firm of G. and K. O'Connor Pty Ltd, which runs a beef export plant at Pakenham, south-east of Melbourne. The plant employed up to 350 workers, all members of the Australian Meat Industry Employees Union, and for eight years prior to 1999 it has been a closed shop. For the eight years that it had the closed shop, there had been little industrial trouble. The plant had run its affairs under the terms and conditions of two registered enterprise agreements, both of which were negotiated between the AMIEU and the employer without any strike action or industrial bans being used by the workers in support of their claims. It was a great system. There were fair negotiations, no strikes, no industrial bans and agreements were being reached. During the term of these two agreements, wage increases were minimal and the general conditions of leave, hours, penalties and other entitlements had hardly altered from those that applied during the 1980s. Here we have a responsible trade union. It has been negotiating in a cooperative manner with the employer—no strike action to achieve its goals, no industrial bans—and agreement has been reached.

In the middle of 1998 Kevin O'Connor, the managing director of G. and K. O'Connor, met with the AMIEU and a number of major meat industry employers to discuss future enterprise agreements. The parties concurred—I emphasise that: the parties concurred—that claims would be modest due to a temporary downturn in the industry but that the status quo would prevail, with a small wage adjustment. That was agreed to. The union was acting responsibly. It realised that the industry was in a downturn—in fact, the beef industry in Victoria, as the honourable member for Corangamite would be well aware, is in about a 30-year low period. And again responsible trade unionism negotiated a deal which was acceptable.

What has changed? You will see as I go on that this particular matter has the fingerprints of the Minister for Employment, Workplace Relations and Small Business all over it. He has been standing there with that smoking gun. In November 1998 O'Connor served a list of 28 claims for its new agreement against the AMIEU which started with wage cuts of at least 10 per cent to all employees and up to 17½ per cent for slicers. The other 26 items cut back various entitlements such as public holidays, penalties, shift allowances, superannuation and so on.

A short time later, notification of a bargaining period under the Workplace Relations Act 1996 was issued specifically for negotiating a new agreement with the union. I emphasise `a new agreement with the union'. A series of negotiations in December 1998 and January 1999 took place, each one of which was characterised by the company refusing to talk about offsets or ways of reaching agreement unless the wage cuts were accepted as a prerequisite. The last such negotiations were in early January 1999. In March, without any further attempt to settle the new terms, the company used the Workplace Relations Act to lock out the remaining 220 workers. By this time many had already left, fearing the consequences of O'Connor's intended use of the act.

So you can see there has been a major change in attitude from this employer—from cooperation with the union over a period of almost 10 years, in which agreement was able to be reached, to, all of a sudden, a major change, and enter the minister for workplace relations. At the time of writing, the lockout is in about its 28th week. In stark terms, this means that 220 workers who were employed at the plant at the commencement of the lockout in mid-March have now been without income or work at the meatworks for almost 200 days. You can imagine the hardship that has been placed on them. I understand there have been homes repossessed, marriage breakdowns—all the things you would expect when workers on relatively low wages are deprived of their work via a lockout. It is important to examine the role of the minister's Workplace Relations Act in this dispute and the devastating social effect O'Connor's use of this act has had on the Pakenham meatworkers that I have just referred to. They not only have been denied their livelihoods but have not been paid any of the accrued entitlements owing to them—that is a major factor in this—at the time they were locked out. The minister's legislation has enabled O'Connor to do this. It would be quite reasonable to assume that the minister himself, his department or his legal firm, Dunhill Madden Butler, have advised O'Connor to use the act in this vicious fashion. Normally when a factory closes, be it permanently or seasonally, as is the case with O'Connor under normal circumstances, the employer pays out pro rata long service leave, annual leave, unused sick leave and rostered days off.

As I said before, the meat industry is in a downturn—especially the beef industry in Victoria. There are several other large abattoirs in Victoria which have closed seasonally but paid up all of the accrued entitlements as per the norm. But O'Connor is different. And why? Because the stamp of the minister for workplace relations is all over it.

Many of O'Connor's workers had up to 20 years service—20 years faithful service—with the company and would in normal circumstances be paid out many thousands. In the legislation a lockout is only supposed to be legal if proper negotiations have preceded it. O'Connor never at any stage sought to properly negotiate dollars for built up leave entitlements; O'Connor's cruel use of the Workplace Relations Act has meant that these people did not receive one cent.

Fortunately, fellow unionists, progressive organisations and many individuals have heeded the unions's call to provide assistance to the locked out employees. Thousands of dollars have been collected and donated to the fund set up to assist those in need as a result of the actions of O'Connor and the government. At the start of the lockout the union took legal action to try to force a resumption of work under the agreement. All discussions between O'Connor and the union were prefaced by the company's up-front demands of wage reductions of 10 and 17 per cent before it was prepared to discuss any other matters. It was holding a gun at the union's head. Judge Marshall in the Federal Court found that, because the company had made this claim for wage cuts and it had been rejected by the work force at Pakenham, this constituted proper negotiations and the lockout could continue.

This exposes once and for all the real intent of the Workplace Relations Act, which is to destroy workers' wages and conditions and undermine their bargaining position. This is, of course, what was always intended by Mr Reith and Mr Howard. There is a consistent thread behind all their legislation—to make life harder for workers and easier for employers. An example of the hypocrisy of the company and the way the legislation assists these employers to be dishonest can be seen in recent developments in the saga. On the weekend of 14 and 15 August, many, if not all, of the locked out members received a new lockout notice. It should be emphasised that the original lockout notices in March were for the purpose of renegotiating an agreement with the union. That was clearly spelt out when the company applied for the prescribed bargaining period.

The new notices over the period 14 and 15 August, however, state that O'Connor seeks to make an Australian workplace agreement. In other words, the reason for the previous 23 weeks of hardship and acrimony has not changed and the company seeks to impose Australian workplace agreements on the employees or recruit new workers under terms and conditions not only vastly inferior to the last enterprise agreement but also vastly inferior to those offered in November 1998. These outrageous developments are subject to legal challenge on a number of well supported grounds, and I understand there was a hearing in the courts in Melbourne today.

Nevertheless, this is still a stark reminder of the human distress that callous use of the minister's legislation can effect and a timely reminder of how much worse it could be if the second wave of attacks on worker and union rights is not resisted vigorously in this parliament.