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Monday, 26 March 2001
Page: 22981

Senator LUDWIG (7:30 PM) —I rise to speak on the Workplace Relations Amendment (Unfair Dismissals) Bill 1998 [No. 2]. I was hoping tonight to speak on a bill about the year 2000 or even 2001, but it seems that we have resurrected the Workplace Relations Amendment (Unfair Dismissals) Bill from as far back as 1998 to bring it on for debate and final resolution. It is not a bill I am unfamiliar with. It seems to have been floating around for quite some time. From memory, I think it has been debated in this chamber some eight times in the past. I recall the previous minister, Mr Reith, tried to introduce the effect of this bill by regulation. If I recall correctly—though I am open to correction—it was before Christmas, which was an unusual time but a time when someone might have tried to sneak through a regulation and hope that no-one actually saw it. I certainly would not subscribe that to Mr Reith, but it was an unusual time to go about doing that.

The Workplace Relations Amendment (Unfair Dismissals) Bill 1998 [No. 2] is, at its heart, an unfair bill with respect to not only unfair dismissals but also its true nature. It does not introduce fairness. It does not introduce equity. It does not set about righting wrongs or fixing injustices. This government may wish to use its expertise to pursue these issues, but instead it seeks to take away people's rights. It seeks to limit people's rights. In fact, in the workplace relations area, this government seems hell-bent on circumscribing and delimiting people's rights. The government does that under the guise of the word `reform'. The government says that it is really part of a workplace reform agenda. Of course, that does not prevent the government from setting about taking away people's rights under any label it wishes to place on it. What is slightly annoying—and perhaps more so for the people who might be subject to this bill if it were to pass—is that the government uses the word `reform' quite improperly. It uses the word `reform' when in fact it really means a backward step. What it means to say is: `We want to support the big end of town.'

The government does that under the guise of helping small business and trying to assist business to compete effectively in the marketplace—not by looking at education, health or trade policies but by saying, `What we need to do is deregulate the labour market.' What a term! We are talking about people. We are not talking about deregulating technology, deregulating a structure or moving from away one policy initiative to another policy initiative. We are talking about taking away people's rights to have fair and equitable access to a court of law or, in this instance, to a tribunal to allow it to adjudicate in relation to a dispute that may arise in the workplace. We are told in the explanatory memorandum to this piece of dastardly legislation that the purpose of subsection 170CE(5A) is:

to specify the requirements for an employee (other than an apprentice or trainee)—

heaven knows why the government saves them—

to be allowed to make an application under subsection 170CE(1) on the ground that a termination was harsh, unjust or unreasonable (or on grounds that include that ground). The requirements will be that, at the relevant time, the employee—

and here is the sting in the tail—

had completed at least six months of continuous service with the employer; and

was employed by an employer with more than 15 employees.

So there we have it. Should this bill pass, the government intends to gain access to unfair dismissals, to gain access to the tribunal which has been set up to look after the interests of employees—and employers, I should add. An employee will have had to have completed a six-month period of continuous service and be employed by an employer who employs 15 or more employees. So there are two hurdles to jump over.

In a steeplechase this government might excel, but in relation to employees it is quite unfair to say that to access a tribunal you have to fit yourself within those two circumstances. We already understand that the mobility of employees in Australia is quite high. We already understand that a small business might have more than 15 employees or fewer than 15 employees. We already understand that the federal sphere does not cover the entire field—there are state jurisdictions and a federal jurisdiction as well. And now the government is saying that, in relation to this narrow scope, this narrow ambit, these conditions should apply. These conditions are not positive initiatives. They are not about, as the government would have it, promoting employment; they are about taking away employees' rights.

Sometimes these conditions mask good policies of employers. Rather than all employers having one policy about how they should employ and how they should be flexible in addressing their employee requirements and being able to ensure that their policies and practices are reasonable so that if they are going to dismiss employees they do it in a fair and equitable manner, the conditions create a dividing line where those above the line are subject to the legislation and are required to keep a policy that is fair and equitable and those below the line are not required, by the looks of it, to do anything about it. Therefore, you can imagine that even amongst the employers there would be a little bit of concern that this bill is unfair and it could work against their own interests. It would not dawn on an employer to restructure the business to try to fit within the legislation. That possibility would be countenanced by some. They would not be the fair and equitable employers; they might be at the other end of the spectrum.

When you then look at the legislation as it is drafted you get into these definitional problems of who is and who is not within the legislation. In some instances some of those issues will be dealt with by regulation—that is within the bill itself. Others will come about because of the very nature of the two exclusions—employers may seek to address the issue by changing the nature of the employment of employees. In other words, they might say to the 16th employee in the business, `I would otherwise have full-time work for you but it would be better to employ you casually or to employ two people instead of you,' to maintain a number which would then put them outside the scope of this legislation. In other words, employers would make decisions based on legislation rather than on good economic sound principles or profit motives.

Definitional problems might also arise if an employer changes the nature of their business—split the business into two or have separate companies. The argument might run that they would not do that, that it would not be commonsense. But, having experienced business in a number of occupations in the past—small business particularly—I recall on one occasion that, to avoid the trading hours legislation that was operating in Queensland at the time, businesses did split their businesses and did restructure their businesses to enable them to, as they would say, `open their hours' and compete with the business down the road that they might otherwise not have been able to compete with because they had a different structure with fewer employees or they were a bigger business. So businesses will consider these issues and, if they possibly can, involve themselves in these types of practices. Sometimes it may not be commonsense to do that but still that does not appear to stop them. The second reading speech does provide some explanation. It says:

The government is not reintroducing this bill because it wants to have an election over it. The government is reintroducing this bill to implement its mandate and policy and to unlock small business access to some 50,000 new jobs which would be created in the economy if this bill were passed.

Let us dissect the phrase. Usually when you say `not' it is the real reason anyway, otherwise you would not have to deny it. There is not much of a positive statement that you could glean from that. But what you can glean from that is that the government says that it could be created. It does not say that this will happen, that this is a possible corollary of the introduction of the unfair dismissal legislation. It uses phrases that are fuzzy around the edges—to use a nondescript term. It does not say with any degree of particularity that if you introduce this legislation this will happen. What it says is that this could happen. What it does not say is that down the track will small business continue to employ people or will they change the processes or will the government introduce more legislation to fix up changed business practices that may have eventuated? It goes on to say:

The proposed small business exemption has been the subject of an almost unprecedented degree of political obstructionism.

The government use that phrase when they cannot negotiate legislation through this chamber. It is an unfortunate phrase to fall back on but the government appear to use it when they are unable or do not have the ability to negotiate an outcome through this house. They then resort to the phrase `political obstructionism'. It is unfortunate, but we would certainly put up with it if it meant ensuring that unfair legislation does not pass. In my view and the Labor Party's view the government have not been able to demonstrate in any fair-minded way the reasonableness of this legislation, the necessity for it, or even where it will provide some material benefit to small business and to employees—in other words, in the labour market as well. If you were to introduce legislation to help small business then the Labor Party would be supportive of it.

The government could take another direction. They appear to have adopted our policies in relation to BAS and some of our policies in rolling back the GST. Those benefits will help small business. The Labor Party is not about being obstructionist in improving the lot of small business; it is about providing benefits in a fair and equitable way without impacting negatively on others in the marketplace. We are all in the marketplace at the end of the day, both employees and employers. Many small businesses operate more consensually than you would expect. Small business has to get on with its employees. As I recall, small business does provide incentives to employees and they do work together. Occasionally those relationships break down and they require the tribunal to assist them to work through those small issues.

I do not think that it is a matter that is easily put aside on the basis that the introduction of this bill would be a `fix-it' for small business, unlock unlimited job opportunities and provide small business with the incentive to create employment. The truth of the matter is that small business with government support directed in appropriate areas and with assistance in relation to the more weighty issues that confront it, such as BAS, would be provided with greater opportunity to develop in the marketplace and create employment. The second reading speech states:

The case for the passage of the bill is overwhelming.

I am overwhelmed by that statement! There is no clear argument that is overwhelming that I can find, let alone within the second reading speech. It refers, hopefully, to the Senate committee report on the area and very little else, except for perhaps a survey or two, to create a position where they can say that the position is overwhelming. In fact, if the case were put that that was the only thing that they relied on—and, from my reading of the second reading speech, there do not appear to be many other arguments being put forward—then, certainly, I would be underwhelmed that they use that to say there is a dire need for the introduction of this bill.

The difficulties, as I alluded to earlier, are also fairly clear. If we dissect the Commonwealth's responsibility in relation to industrial relations—let us do that for a moment—we see that the small business exemption that is offered here is a part of what this government has already tried to implement, and has implemented in some respects, through its so-called reform agenda—and that goes to caps on the number of claims that can be progressed through the unfair dismissal area. There are also other stops in the system, which include of course that federal legislation does not cover corporate associations; it only covers incorporated associations and the like. This legislation really brings it down to a very marginal area compared with the greater area where small business exists. Of course, that might also bring inequities whereby people could point to the federal sphere in particular and say, `If this bill were introduced, it would be unfair because, while we are subject to state law, or while we are outside the cap, we are unable to access this particular unfair dismissal provision encapsulated in this bill.' So you create this quite confusing position.

The supporters say—and I think they are bland statements, in truth—that it does not affect the rights of existing employees. As I have said, if you look at job mobility, it will affect employees. To say that it does not affect existing employees is quite erroneous when a person might leave a small business and return at some point and so then would come back under the legislation. Supporters say that it is necessary to ensure the continuing growth in employment in small business. There is no evidence of that. Some of the supporters of this unfortunate bill say that it was a mandate given to this government to pursue; I think it is more of an election campaign issue that this government is pursuing. The critics of the proposed bill justify the case for why this bill should not proceed. They continue to say that the bill may encourage some employers to create artificial business entities to avoid the law by reducing the nominal size of their work force and the like.

The Industrial Relations Commission has the capacity to deal with this area in a fair and equitable manner. This government should support the Industrial Relations Commission. It should leave this area to the Industrial Relations Commission and leave employers and employees to sort out the issues through consultation, and it should not intrude in an obstructionist manner.