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Wednesday, 28 June 2000
Page: 18401

Mr REITH (Minister for Employment, Workplace Relations and Small Business) (10:13 AM) —I move:

That the bill be now read a second time.

The coalition's 1998 workplace relations election policy More Jobs, Better Pay contained commitments to further legislative reform in our second term of office.

These commitments were reflected in four pieces of legislation already introduced by the government since October 1998, dealing with small business unfair dismissal exemptions, superannuation, youth wages and multiple reform issues in the Workplace Relations Legislation Amendment (More Jobs, Better Pay Bill) 1999.

That bill was passed by the House of Representatives on 14 October 1999 but subsequently blocked by the combined opposition of the Labor Party and the Australian Democrats in the Senate.

Since opposing the `more jobs, better pay bill' last November, the Democrats have publicly indicated that they prefer to deal with the contents of that bill on an issue by issue basis, not as an omnibus piece of legislation.

In a speech to the ACT Industrial Relations Society on 6 April 2000, Democrat spokesman Senator Murray said, and I quote:

In my view only technical bills should be general and broad ranging. Policy bills should be specific. It is far better for a reformist government to deal with one issue at a time on a specific and limited basis.

And again, in the course of the inquiry by the Senate Employment, Workplace Relations, Small Business and Education Legislation Committee into the bill, the senator said:

It seems to me the Act can be conveniently broken up into major sectors ... I find these kind of omnibus bills result in a lot of negativity and it is very difficult to progress them.

Taking these sentiments into account, the government has sought to accommodate the preferences of the Australian Democrats by proceeding, other than on technical issues, with an issue by issue consideration of policy matters arising from the `more jobs, better pay bill 1999'.

The first of these issue by issue bills was a bill dealing with pattern bargaining and related matters which passed the House on 1 June 2000, but which is now also being opposed in the Senate by the Labor Party and, so far, by the Democrats.

The government is now in a position to introduce further single issue bills drawn from the `more jobs, better pay bill 1999'.

This bill concerns procedural and technical amendments to the approval processes for Australian workplace agreements.

The Workplace Relations Act 1996 has provided a wide range of options to employers and employees recognising that different workplace arrangements will suit different organisations. Employers and employees can choose between collective certified agreements, made with a union or directly with employees, Australian workplace agreements, which are made directly between a single employer and employee, informal agreements, or a mix of these forms.

The right for an employer and employee to make formal individual employment agreements has been one of the outstanding features of this government's reforms.

There is no doubt that AWAs have found support among employers and employees. This is evidenced by the increasing use of AWAs. Over 100,000 individual agreements have been made since the provisions of the Workplace Relations Act came into effect, covering around 1,900 employers. More than 4,500 agreements are now being made each month and during last month alone more than 6,000 new AWAs were made.

AWAs have been used to introduce a wide range of innovative flexible working arrangements. They have helped lift productivity, often tailored wages to performance incentives and bonuses, and allowed more flexible work arrangements so that employees can balance their work and family requirements.

The government is committed to AWAs and the right of workers and employers to choose to make them. The government, unlike the opposition, believes that it is important to ensure that employers and employees have genuine choice about the working arrangements which will apply to them.

Streamlining agreement-making

While ensuring that Australian workplace agreements, certified agreements and the no-disadvantage test are retained, the amendments will introduce a streamlined approval process for AWAs.

The current filing and approval processes for AWAs will be amalgamated to ensure a much simpler and speedier formalisation process. AWAs—and variation agreements—will take effect from the date of signing, or the date specified in the agreement or the date employment commences. This will mean that pending approval by the Employment Advocate, there is a presumption that the AWA meets all the statutory tests.

Employers will be required to apply within 60 days to have the agreement approved. There are complementary provisions introducing cooling off periods and compensation provisions to fully protect employees' interests.

AWA procedures for high salary earners—those whose remuneration is higher than $68,000—will be fast tracked. Unless otherwise requested, for employees whose remuneration is above $68,000, an AWA accompanied by the appropriate declarations from an employee will not be assessed against the no-disadvantage test before approval. Of course, where the employee still requests such an assessment be made by the Employment Advocate, it will occur.

The employer will no longer be required to satisfy the Employment Advocate that the employer did not act unfairly or unreasonably in failing to offer AWAs in the same terms to all comparable employees. These changes will provide greater scope to recognise individual performance through such agreements.

Approval of all AWAs will be by the Employment Advocate. Currently, where the Employment Advocate has concerns about whether an AWA meets the no-disadvantage test (NDT), the Employment Advocate must refer the AWA to the commission. This has frequently meant delay in finalising approval of the AWA. The proposed amendments will give the power to the Employment Advocate to decide whether or not to approve an AWA, subject to principles which may be developed for this purpose by the president of the commission.

Relationship between AWAs and other instruments

In addition to simplifying the processes associated with the making and approval of AWAs, the legislation will clarify the relationship between AWAs and awards—including state awards—certified agreements, state agreements and other legislative instruments, in order to allow them to operate more effectively. For example, provision is being made to ensure AWAs are not excluded by those awards made under section 170MX.

Industrial action and AWAs

Finally, the bill's amendments will remove the limited immunity available in respect of industrial action taken in support of a claim for an AWA. The AWA industrial action provisions appear to have rarely been threatened, let alone used.

In introducing this bill the government is conscious of the fact that the Australian Democrats have supported the role that AWAs play in our modern workplace relations system.

As Democrat spokesman Senator Murray said on 1 June 2000:

AWAs have a good place as part of the agreement mix. A limited number of employees, particularly better paid highly skilled employees, where the one-size-fits-all award could be an impediment to productivity, do well under AWAs.

The Democrats' dissenting report to the Senate Employment, Workplace Relations, Small Business and Education Legislation Committee in November 1999 did not support the AWA amendments as a whole, but did indicate that `there are some positive matters dealt with in this [AWA] schedule'.

The Democrats are also on the record as supporting simplified, less technical and less legalistic procedures for employers and employees using the system.

In these circumstances, it is reasonable for the government and the Democrat support for AWAs to be translated into a more streamlined approval process. That is what these amendments do.

In introducing this bill I am clearly indicating that the government is determined to proceed on an issue in respect of which there appears to be Democrat support. The government is prepared to consider amendments to refine the detail of the procedures proposed by the bill, if it is the detail that is the barrier to the bill's passage through the parliament.

The bill is an important one which will build on the objects of the 1996 reforms and improve the AWA system in the interests of employers, employees and small business.

Of course, this matter has already been before a Senate committee. However, the government would welcome further Senate scrutiny, provided that such a committee will review the bill in order to ensure a more effective framework for making AWAs and so underpin better access to the full range of agreement options.

The right of the coalition to implement its workplace relations mandate, subject to constructive Senate review, is a principle that has been acknowledged by the Democrats—and one that they should now act upon.

On 15 June 1996, the then Leader of the Australian Democrats—now Labor shadow minister Kernot—said on the issue of workplace relations:

The Democrats accept that the government has been elected to govern and that it has its right to present its legislative program to the parliament for consideration. But the Democrats have been elected to do a job, and that is to closely scrutinise legislation to ensure that it is fair, and workable and the best solution to an identified problem.

... the Democrats have no intention of being obstructionist in this Senate. As we have done for 15 years of holding balance of power, we will carefully review legislation, suggesting ways to make it work better if possible.

Adopting a just say `no' attitude to this bill would be inconsistent with not only the proper role of the Senate as a house of review but also breach the principle under which the Democrats themselves marked out their past approach to these issues, at least until 1997.

I commend the bill to the House and present the explanatory memorandum.

Debate (on motion by Mr Horne) adjourned.