Senator SHERRY (5:48 PM) —The Workplace Relations Amendment (Genuine Bargaining) Bill 2002 recycles in modified form several proposals rejected by the Senate first in 1999 and again in 2000. Unfortunately, most of the criticisms made of the previous measures apply yet again. This bill will do nothing to facilitate genuine bargaining. Instead, it remains narrowly focused on reducing the right to take protected industrial action and on suspending or terminating the bargaining process. The Labor Party strongly supports enterprise bargaining, which remains at the heart of our industrial relations policy. The difference between the Labor Party and the Liberal government is that we take a broader view of what is needed to improve the enterprise bargaining process.

A whole range of activities take place before anyone contemplates taking industrial action. Correspondence is exchanged and meetings are arranged, the parties set out their claims, consider those claims, make compromise proposals and seek to reach agreement. When negotiations get stuck, the parties can use the conciliation process of the Industrial Relations Commission, as we saw during the recent BHP WesternPort and Stegbar disputes. These activities are the most critical to agreement making, yet the government's so-called genuine bargaining bill says nothing about them. If parties refuse to meet or fail to adhere to commitments or follow agreed procedures or fail to respond to proposals or fail to disclose relevant information or capriciously add or withdraw items for negotiation, then an agreement is unlikely.

Instead, agreements are more likely and will be reached more quickly if the parties are bargaining in good faith. Accordingly, the Labor Party has moved in the House, and will be moving in this chamber in the committee stage, amendments to give the Industrial Relations Commission back its powers to make orders that will ensure that the parties bargain in good faith. These amendments are designed to bring together the parties under the auspices of the commission and hold them equally responsible for conducting cordial and efficient negotiations. As I will expand on later, this fair and equitable approach stands in sharp contrast with the Liberal government bill, which effectively places the responsibility to bargain in good faith disproportionately on unions. I add that the Liberal government took the short-sighted decision to remove this power in 1996. It is time for the Liberal government to acknowledge that this has only had the effect of prolonging difficult industrial disputes. It is time for the Liberal government to support good faith bargaining.

The first aspect of this bill I want to talk about is proposed section 170MW(2A), which purports to provide guidance to the Industrial Relations Commission on matters that would tend to indicate whether a party to enterprise bargaining negotiations is genuinely seeking to reach agreement. The Liberal government claims that this provision draws on the decision of Justice Munro in the metals case in 2000 and is necessary to ensure genuine enterprise bargaining, yet Justice Munro's decision demonstrates that the commission is in no need of this government's guidance. In the metals case, Justice Munro used section 170MW(1) to terminate bargaining periods against 33 employers because he was satisfied that the respondent unions were not genuinely trying to reach an agreement with them in taking industrial action. The key statement of Justice Munro was:

Justice Munro went on to say:

These comments demonstrate the commission is well aware of the requirement in the Workplace Relations Act that there be genuine bargaining at the enterprise level and of the powers available to it to ensure that this occurs. It does not need an ideological assumption imposed on it by this government.

Justice Munro's decision had a fairness and balance that is wholly absent from the Liberal government's bill. It is appropriate and sufficient in the opposition's view for a reference to the decision of Justice Munro to be inserted in section 170MW. Although the government has removed from this bill any reference to pattern bargaining, it has continued to use that expression in debate to refer to the pursuit of a common set of demands across an industry. It is worth recalling what Justice Munro said about this because the Liberal government has certainly forgotten. The judge said:

Justice Munro also noted that the industrial strategy of pursuing common outcomes across workplaces is practised as much by employer interests as employee interests. He said:

It is interesting to note that a number of factors in proposed section 170MW(2A) of the bill are actually principles of good faith bargaining. I refer in particular to paragraphs (d) and (e). Paragraph (d) refers to a circumstance where:

Paragraph (e) contemplates a situation where:

They are sensible principles. Yet under this bill they only apply if and when an application has been made to the commission to suspend a bargaining period in order to curtail or prevent protected industrial action. The result would be that, in practice, the requirement for good faith bargaining would apply only to unions and only in cases where the union is considering or undertaking protected action. If the government genuinely wished to promote good faith bargaining, a more even-handed and effective approach would be to restore the commission's power to order all parties—whether they be employer, union or employee—to bargain in good faith. As it stands, under the existing act and the government's bill, employers who refuse to bargain in good faith would face no effective sanctions, except in the relatively rare instances where they wish to undertake protected industrial action. This is not fair, and this is why a fair bill, a balanced bill, would be one that adopts Labor's amendments.

The second aspect of this bill is proposed section 170MWA, which confers a power on the commission to order that a party may not initiate a new bargaining period. This measure is apparently aimed at situations where a party peremptorily terminates a bargaining period in order to deprive the commission of jurisdiction to hear an application under section 170MW. Again, this is the wrong approach. Instead of enabling the commission to bring the parties to an agreement, this bill simply encourages the commission to wash its hands of a dispute. This measure also manifests the false assumption that the commission is unable to deal with such a tactic.

If a party has terminated a bargaining period to avoid an application under section 170MW, then it is no longer open to them to take protected action. If the party then initiates a new bargaining period, they must meet the requirements of the act in order to take protected action again. One of those requirements is that the party has genuinely sought to reach an agreement before taking protected action. It is not open to a party to initiate and terminate bargaining periods and go out on strike willy-nilly. When they are doing so, it is presently open to the commission to impose a cooling-off period, if that is the most appropriate action in the circumstances.

Justice Munro's decision in the metals case demonstrates that. In that case His Honour used the power in section 170MW(10) to prevent the AMWU from initiating a new bargaining period for two months. In other words, His Honour imposed a cooling-off period using a power the commission already possesses under the act. His Honour's decision shows the commission is alive to tactics which do not constitute genuine bargaining and is well prepared to deal with them. His Honour said:

Another instance where the commission has exercised this power was in a 2001 dispute between Caltex and the AWU.

The third aspect of this bill is proposed section 170MWB, which provides for cooling-off periods. This provision is very much a wolf in sheep's clothing. It is commonsense that damaging strikes should be avoided, and where they occur all efforts should be directed towards bringing the parties to an agreement. But, once again, instead of encouraging the commission to get among the action, bring the parties to the bargaining table and force a resolution, the Liberal government is encouraging the commission to wash its hands of difficult disputes. In the most difficult disputes, it is clear that the commission already has the power to order a cooling-off period. As Justice Munro said in the metals case:

The government's provision is most notable for the fact that it resurrects the voluntary conciliation model rejected by the Senate as part of the government's 1999 More Jobs Better Pay, or mojo, bill. The government is still trying to recover its mojo! That bill sought to abolish compulsory conciliation except on allowable award matters, to introduce user pays voluntary conciliation and to give legislative recognition to private mediation. Similarly, this bill allows only for voluntary conciliation during a cooling-off period. The Liberal government clearly hopes that measures such as this will continue to erode the role of the commission as an independent umpire. This can only hinder the fair and efficient settlement of industrial disputes.

You would think that, for all his rhetoric about genuine bargaining, the Minister for Employment and Workplace Relations would ensure his own department practises what it preaches. Yet public sector employees have good reason to think that the term `ultramilitant' is better applied to this government than the unions the minister constantly seeks to demonise. Take current negotiations—if indeed that word can be stretched so far—for an enterprise agreement with the Department of Employment and Workplace Relations. The department relentlessly pursued a section 170LK agreement, which does not have the union as a party. Initially, the department encountered one small problem: 90 per cent of its staff wanted the union to negotiate an agreement on their behalf. Unfortunately for the department, the stand-off over the form of the agreement attracted unwelcome scrutiny from the media. The department's strategy unravelled even further when it was hauled before the Australian Industrial Relations Commission to explain its reluctance to bargain with the union as its staff had requested. Before the Industrial Relations Commission had a chance to make unwelcome recommendations such as that the department conduct a ballot of its staff about the form of agreement they wanted, the department backed down and agreed to a two-week bargaining period with the union.

It would be difficult to convey in words everyone's astonishment that those two weeks of negotiations did not produce an agreement. The department proceeded to put its non-union agreement to a vote on 1 July. Despite the frantic efforts of the department, fewer than 10 per cent of its staff voted yes to the agreement. Even today there is still no enterprise agreement in the department. Indeed, in late August staff in the department went out on strike over this good example of bad bargaining. It was disturbing to hear on the PM program on ABC radio and to read in the Canberra Times that the secretary of the department—that well-known militant, Dr Boxall—had been promised a bottle of champagne by his predecessor, Dr Shergold, if Dr Boxall could get a non-union agreement in the department. These reports simply reinforce the need to discover the cost to the taxpayer of Dr Boxall's disastrous bargaining strategy. In summary, if this sorry episode represents the Howard government's view of genuine bargaining, Australian businesses and workers have good reason to be suspicious of any government bill bearing that name.

I turn to the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002. This bill represents a new era in Australian industrial relations. For example, for the first time it will introduce into the Workplace Relations Act provisions with five letters after the number. No longer will Collins Street and Phillip Street lawyers have to make do with wimpy sections like section 170VPK or section 170WHD. Imagine their ecstasy as they get to tell employers and employees that they must comply with section 170NBCQ and—wait for it—section 170NBGBC.

Senator George Campbell —You'll need WD40 to grease the wheels!

Senator SHERRY —That's right. For a minister who recently told the H.R. Nicholls Society that he was `fully post-Marxist', this bill reveals an astonishing fondness for bureaucracy. This is a bill so complex it would have made Yuri Andropov blush.

Senator Patterson —Is this all in your copious notes?

Senator SHERRY —We all suffer from that syndrome, Minister, as you well know. Before addressing the provisions of the Workplace Relations Amendment (Secret Ballots for Protected Action) Bill 2002, it is important to see how it fits into the landscape of enterprise bargaining and protected action. The regime governing protected industrial action was produced by the Keating government in 1993 as part of its far-sighted enterprise bargaining reforms. Those reforms were about encouraging employers and employees to bargain in good faith and to reach agreements in the workplace which dealt appropriately with their needs. The reforms brought about a dramatic growth in productive and cooperative workplaces and a dramatic fall in industrial disputation.

Labor recognised that, as part of the bargaining process, employees and employers should be able to take industrial action in accordance with the law without being exposed to financially ruinous and traumatic court proceedings for industrial torts. Accordingly, employees and employers were granted a limited immunity from industrial tort action taken to advance claims during a bargaining period. To ensure that such industrial action occurred in an orderly and civilised way, a number of conditions had to be satisfied before the immunity was conferred: firstly, a bargaining period had to be validly initiated; secondly, employers or employees were required to give at least three days written notice of the nature of the proposed action; thirdly, the industrial action had to be preceded by an attempt to reach agreement; fourthly, industrial action by an organisation of employees had to be duly authorised by the organisation's committee of management; fifthly, the industrial action could not involve personal injury, wilful or reckless damage to property or the unlawful taking or use of property; sixthly, if the Industrial Relations Commission had seen value in ordering a secret ballot of employees, such industrial action had to be approved by a majority in the ballot.

The Liberal government predicted that conferring a right to precede protected action would lead to an explosion in strike activity—much as they claim that anything but the most miserly increase in the minimum wage will destroy thousands of jobs. Not surprisingly, they got it wrong. Under the Fraser government, a yearly average of 590 days were lost per 1,000 employees to industrial disputes. This steadily declined as the Labor government pursued economic reforms through an inclusive and cooperative industrial relations framework. Until the year to January 1993, only 148 days were lost per 1,000 employees. By January 1996, barely two years later, it was down to 80 days. This fall in disputation, which was accompanied by a growth in productivity and better wages and conditions, proved that Labor got the balance right. For many years the Liberal government have been saying that what is needed is deregulation of the labour market—and what an excellent piece of deregulation this bill is. It will add around 40 pages to the Workplace Relations Act and it will add a degree of complexity to the bargaining process that not even the former Soviet Union politburo could have dreamt up.

The bill will require the following steps to be followed before employees can take protected industrial action. Firstly, an employee or union must apply to the Industrial Relations Commission for an order that a secret ballot be held. If no union is present, then the employees cannot even make an application unless doing so has the support of the prescribed number of employees. If there are fewer than 80 relevant employees, the prescribed number is four. If there are between 80 and 5,000 employees, then the prescribed number is five per cent. If there are more than 5,000 employees, then the prescribed number is 250. The bill does not make clear what constitutes support for an application. Is it moral support—some words of encouragement and a pat on the back—or perhaps a secret ballot about whether an application should be made for a secret ballot? Not to worry—that point can always be resolved by litigation. The application must set out the question or questions to be put to the relevant employees in the ballot, including the nature of the proposed industrial action, details of the type of employees who are to be balloted and any details required by the rules, which have not yet been made. The application must be accompanied by a copy of the notice initiating the bargaining period, particulars accompanying that notice and a declaration that the proposed industrial action does not relate to an objectionable provision. If you can get all that paperwork in order, then you might just have a valid application for a secret ballot. Then the commission must give the parties opportunities to make submissions.

We are now up to clause 170NBCB. We have some ground to cover until we reach clause 170NBDE, which is when the results of the ballot are known. The commission must satisfy itself that the applicant for the ballot has genuinely tried, and is genuinely trying, to reach agreement with the employer. It must also consider whether or not the proposed ballot is inconsistent with the objective of establishing a transparent process which allows employees directly concerned to choose, by means of a fair and democratic secret ballot, whether to authorise industrial action supporting or advancing claims by employees or organisations of employees. It must also be satisfied that the applicant has not at any time contravened the secret ballot provisions of the act. If the commission has satisfied itself of all these things, then it must frame an order for the ballot specifying the name of the applicant or agenda and a range of other bureaucratic requirements. At this point, I observe that a well-worn mantra of this Liberal government is to remove unwanted third parties from the employment relationship; yet, with this bill, the government proposes to involve not only a third party in the form of the commission—which did not necessarily have a role before—but also a fourth party and a fifth party in the form of the person conducting the ballot and the independent adviser for the ballot. I believe we are seeing the birth of a new industrial relations club.

The ACTING DEPUTY PRESIDENT (Senator Knowles)—Senator Sherry, your time has expired, but you may care to move your second reading amendment.

Senator SHERRY —Thank you. I move: