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Tuesday, 8 November 2005
Page: 60


Mrs MAY (6:14 PM) —I cannot help but feel a sense of history as I rise to speak on the Workplace Relations Amendment (Work Choices) Bill 2005, as I have no doubt this bill will become very much part of the history of workplace relations in this country. This is an evolutionary process, not a revolutionary process, as members on the other side would like us to believe. It is not massive or extreme legislation, as the member for Parramatta would have us believe. This is a bill, a set of reforms, for the 21st century.

The support both nationally and even internationally for these reforms is well documented. There have been some strong voices who have spoken about the need for workplace relations reform in this country. Commentators have spoken about the need for reform for many years. In its 2005 survey of Australia, the IMF particularly argued that employment and productivity can be improved by implementing proposed reforms of labour markets and welfare policies. Similarly, the 2005 OECD economic survey on Australia said:

To further encourage participation and favour employment, the industrial relations system also needs to be reformed so as to increase the flexibility of the labour market, reduce employment transaction costs and achieve a closer link between wages and productivity.

So we have on the table a bill that will kick-start further productivity, employment growth, efficiency, innovation and, most importantly, improve household incomes well into the 21st century. Without change, without reform, Australia runs the very real risk of standing still. Our current strong economic position will stagnate. It will not grow in the future without workplace relations reform. With reform we can, as a country and for our people, build another cycle of strong economic performance and growth. We can lock in our future prosperity. Workplace relations reform is a very important part of building that cycle and locking in the prosperity, along with further taxation reform and the reform of business regulation.

The opposition will continue to run a scare campaign against these reforms. They have done it in the past and they will continue to do it in the future. There is no acknowledgment from the opposition that, over the last 20 years, real wages have increased by 25 per cent—up by 20 per cent in the last decade alone. Unemployment has fallen from around 10 per cent when Labor was in power to below five per cent, while youth unemployment improved from nearly 20 per cent to below 15 per cent in just the last decade. However, despite these impressive results, Australia cannot stand still. Our competitiveness and general economic standing have been slipping. Average yearly GDP growth has recently slowed to 2.4 per cent and our economy is facing a number of growth impediments. If reforms are not implemented, Australia could fall from eighth to 18th position on the OECD league ladder—the same place it occupied in 1983, when Australia’s economy was at a historic low.

Ensuring our workplaces are more flexible and increasing productivity are important if the economy is to continue to grow strongly. Unless we bring about change and reform in areas such as workplace relations, we will lose our economic strength in the future. Our economic strength will be eroded. The reforms being proposed by the coalition government are not extreme nor are they radical. The reforms being proposed are to ensure that our system keeps pace with the demands of a modern economy. The changes are the next evolutionary step in the process of change from a centralised award system to one based primarily on bargaining at the workplace level. This process was begun by the Keating government in 1993 and has continued under this government with its 1996 reforms. These historic measures will help modernise Australian workplaces. They will give industry the ability to achieve greater productivity and efficiency and the flow-on effect will ensure increased employment and higher wages for employees.

Under Work Choices, employers and employees will be free to enter into agreements without the bureaucratic processes that currently require a formal AIRC hearing to certify every collective agreement, even when the parties are in complete agreement. Agreement making will be simpler under Work Choices, but employees will be able to seek assistance with the process. The Office of the Employment Advocate will provide advice to both employers and employees on agreement making. Employers and employees can seek legal assistance if they so choose. An employee can have a union representative or a bargaining agent to represent them in the AWA process. Employees will not be left on their own throughout the negotiating process. If they feel they need help, help will be there.

The government will also expand the scope of the Office of Workplace Services to create a one-stop shop to ensure employers and employees know their rights and obligations and that these are fairly enforced. This readily accessible single agency will provide further protection for all employees. The Office of Workplace Services will have the power to enforce compliance with the Workplace Relations Act, the terms and conditions of awards, agreements and AWAs, freedom of association provisions and requirements in relation to agreement making. At present, there are 90 OWS inspectors. That number will increase to 200 under this new legislation. The OWS itself will be empowered to assist, enforce and prosecute any breaches of agreement making. There are further safeguards. The legislation sets out very clearly the key minimum conditions of employment that must be included in any negotiated AWA. These minimum conditions will provide genuine protection for all Australian workers.

The Australian fair pay and conditions standards will contain minimum and award classification wages as set by the AFPC; four weeks paid annual leave, with an additional week for shift workers; the option for employees to cash out up to two weeks leave, but only at the request of the employee; 52 weeks unpaid parental leave; 10 days paid personal or carers leave, including sick leave, for employees with more than 12 months service, plus two days of paid compassionate leave, plus an additional two days of unpaid carers leave per occasion will be available in emergency situations for employees who have used up their paid leave; and a maximum 38-hour working week. Further award conditions such as public holidays, rest breaks, incentive based payments and bonuses, annual leave loadings, allowances, penalty rates and shift or overtime loadings will not form part of the standard but will be protected in the bargaining process. These award conditions may be traded off and bargained for, but only through specific reference in the new agreements. If a new agreement fails to make provision for such matters, the terms of the relevant award will continue to apply.

These standards embodied in the legislation give greater certainty about requirements to employers and employees when they sit down to negotiate an AWA. There will no longer be a hearing based approach to the adoption of AWAs; there will be a more streamlined, simpler and less costly administrative approach which will see all agreements, whether collective or individual, filed with the Office of the Employment Advocate. All agreements, both collective and individual, will take effect from the date of lodgment rather than the date of certification or approval. This will reduce delays and uncertainty and ensure that, once agreement is reached, the parties have the certainty they deserve. Each agreement will be able to run for up to five years.

There has been a lot of confusion over whether or not an employee has to switch to an individual agreement. The simple answer is no. As is presently the case, individual agreements are optional. Employees must agree to individual agreements before they can be lodged with the Office of the Employment Advocate. It will continue to be unlawful for an employer to try and coerce an employee to sign an agreement. It will also continue to be unlawful for an employer to sack an employee for refusing to accept an agreement.

This bill will simplify the complexity inherent in the existence of six workplace relations jurisdictions in Australia by creating a national workplace relations system based on the corporations power that will apply to a majority of Australia’s employers and employees. In Australia at present we have over 130 different pieces of industrial legislation and over 4,000 awards. It just does not make sense in today’s modern economy to have that much regulatory overlap and complexity. It causes too much confusion, it is bad for business, it costs jobs and it will hold Australia back from further economic and jobs growth in the future.

It is time to move towards one simpler national workplace relations system. The reforms are long overdue. Employers and employees in Victoria are already reaping the benefits of moving to a single national workplace system. Maybe their counterparts in other states will take a leaf out of Victoria’s book and work towards achieving a national approach that will yield the most benefits for all. Somehow I think the fight with the majority of the states will be a long one.

The reforms in this bill will, for the first time, properly balance the interests of employers and employees in the areas of dispute resolution, unfair dismissal and termination. Australia’s unfair dismissal laws are inherently unfair and represent an inequitable and unbalanced burden on Australian business, particularly small business. The government has moved to overcome this unfairness by providing balance and, in the first instance, by encouraging employers and employees at a workplace level to choose their own forum for dispute resolution. The government will establish a system of registered private alternative dispute resolution providers. A model dispute resolution procedure—a DRP—will be provided in the bill. It will be included in all awards and will be the default DRP for agreements which do not stipulate their own DRP.

Employees will be protected against unlawful termination regardless of the size of the employer. Unlawful termination will cover such areas as: temporary absence from work due to illness or injury; race, colour, sex, sexual preference, age, physical or mental disability, marital status, family responsibilities, pregnancy, religion, political opinion, national extraction or social origin; refusing to agree to an AWA; absence from work due to maternity leave or parental leave; or temporary absence from work due to carrying out of a voluntary emergency management activity. These are just a number of grounds that will be protected. The government will also provide up to $4,000 of legal advice to eligible unlawful dismissal applicants.

The reform measures in the Workplace Relations Reform (Work Choices) Bill 2005 are long overdue. In fact, the bill contains most of the government’s reform proposals which have stalled since it was elected to office in 1996. Since 1996 there have been 13 separate Senate inquiries into the government’s workplace relations reform proposals. Eight of these inquiries have considered reforms to the unfair dismissal system. It is time now to move forward.

The opposition to the bills from the Labor Party, and indeed the very strong opposition from the union movement, is purely political and ideologically driven. It has nothing to do with the need for this country to move forward into the 21st century with reforms that will continue to see this country prosper and grow—reforms that will take away the shackles from industry to allow them to improve their productivity and to increase opportunities for Australian workers, with more jobs and higher wages that will come with increased productivity. The opposition will undoubtedly continue to peddle the line that Australian living standards will decrease, that people will lose their jobs, and that employers will treat their employees with contempt and unfairness.

Nothing could be further from the truth. The bill before the House will encourage participation in the work force. It will increase the flexibility of the labour market, reduce employment transaction costs and achieve a closer link between wages and productivity in this country. I commend the bill to the House.