Mr BARRESI (9:31 AM) —I continue my remarks from last night’s debate. The reason why the Workplace Relations Amendment (Small Business Employment Protection) Bill 2004 needs to be introduced into the parliament is the decision by the Australian Industrial Relations Commission to overturn small business’s exemption from redundancy pay obligations. The Australian Labor Party’s blocking of unfair dismissal reform in the Senate on over 40 occasions demonstrates that the Labor members in the other house are certainly not friends of the small business community. It is unfortunate that their stance has been supported by the recent decision of the Australian Industrial Relations Commission to impose redundancy pay obligations on the small business community. In this instance, it is not the ALP and their blind allegiance to the militant unions that is placing a noose on small business; it is the AIRC itself. That is a real shame. It is a disgrace.

The AIRC’s decision highlights the deficiencies within the antiquated industrial relations system, which is not up to speed with the needs of modern small business in modern Australia. The fact that there is a need for this bill hammers home the piecemeal pace at which industrial relations reform has taken place in Australia. While many sectors in the economy have adapted and evolved with change, our current industrial relations system is restricted by the parameters of the past. The commission is a creature of initial post Federation Australia. Our economy and our business sector continually strive to adapt to the ever globalising environment. The Australian Industrial Relations Commission however, as a bastion of the traditional industrial club, has continued to stand out as a key example of how the system can stifle modern workplace agreements. The failure of the commission to provide sufficient protection for small businesses against often financially crippling redundancy payments highlights the commission’s disconnection from the needs of our small business community. It also highlights a strong need to reform the commission. I welcome the decision of the Minister for Employment and Workplace Relations to introduce as part of the coming reforms a new Fair Pay Commission along the lines of that currently operating in the United Kingdom.

This important reform will help drag the industrial relations system into the 21st century and will create a real benefit for small business. A strong and sustainable economy is vital for the small business sector to prosper. They do not have the buffer zones within their budgets to absorb an economic downturn and, if things are going well, a small business should be able to put on extra staff. This productive improvement for small business will also enable the local community to share in the net benefit of the strong business climate.

We know that there should not be a ‘one size fits all’ approach to our industrial relations system. It is unfortunate, but the Labor Party’s opposition to this bill highlights that they are increasingly out of touch. They look at industrial relations as something that can so easily be implemented and imposed on businesses no matter what their size. In a strong economy small businesses create employment. The last thing that the small business sector needs is an impediment and a disincentive placed upon it by the AIRC through pressure from an ever irrelevant Australian Council of Trade Unions, which is suffering from underrepresentation in the Australian work force.

Historically the industrial relations system has adapted to contemporary requirements at a snail’s pace. More than ever before, it is evident that large centralised bodies such as the government and the commission have less of a role to play in efficient employment arrangements within small business. This bill is vitally important. Its purpose goes right to the heart of the small business liability. If not passed, the vast majority of small businesses covered by federal awards will eventually be subject to redundancy payments for their employees in accordance with the Industrial Relations Commission’s decision. With the commission’s decision pointing the IR system in a ‘one size fits all’ direction, there is a need for legislative change to guarantee protection for small business.

The bill underlines the current need for reform within this system. The commission’s decision will impose an unfair financial burden on small businesses. Every employee and their employer deserve the right to negotiate and reach an agreement on employment and salary packages. One must ask how far we have actually come in workplace relations given the fact that this piece of legislation is even needed. Small businesses were exempted by the commission’s predecessor, the Conciliation and Arbitration Commission, in 1984.

The decision to exempt small businesses from mandatory severance pay was an ironic step in the right direction by that commission during the time of the former Labor government. It is perplexing to understand why the current Labor opposition are against this bill, considering that those exemptions were put in place when they were in power. More importantly, it is also perplexing when one realises that state based industrial relations commissions around Australia—of course, all in Labor states—have created this exemption as well.

Two years prior to the coalition’s election in 1996, the New South Wales Industrial Commission reaffirmed the need for the small business exemption. Just recently, the Queensland Industrial Relations Commission continued the almost unanimous view that the exemption made plain commonsense. The question remains: why did the national commission go against this trend and why will federal Labor also go against this trend? It is a trend so readily accepted by their mates in Queensland and New South Wales. I ask that the Labor opposition rethink their view on this issue and realise that their position is contrary to the practices that are taking place in other states and also from when they were in power at a federal level.