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Thursday, 13 March 2008
Page: 1689


Mr COMBET (Parliamentary Secretary for Defence Procurement) (9:50 AM) —It gives me much pleasure to speak in support of the Workplace Relations Amendment (Transition to Forward with Fairness) Bill 2008. The bill begins the important process of unravelling the unfair Work Choices legislation of the previous Howard government. I personally spent much of my time over the past few years campaigning against the Work Choices legislation because of the harmful effect that it had on working families.

In my experience, Work Choices was one of the most divisive public policy measures for many years. It is worth recalling some of its key features so as to place in context some of the work which is to be done by the bill which is before the House. Work Choices involved the abolition of protection against unfair dismissal for millions of people. That meant that people could be sacked, the financial security of their family undermined, without remedy or attention to fair process. It also meant the emasculation of the powers of the independent Australian Industrial Relations Commission, an institution which had historically ensured a fair balance between employers and employees in the workplace. Work Choices also involved the abolition of the national wage case, which had for more than a century provided for an open and transparent process for the determination of minimum wages.

Work Choices also included the undermining of the award safety net, putting basic conditions such as penalty rates for shift work, weekend work, public holiday work, annual leave loading, meal and rest breaks, public holidays and a host of other employment conditions up for grabs in workplace bargaining. If an employee did not have the bargaining power to retain these employment conditions, they could be lost. And if an employer wanted to employ people on condition that they did not receive such entitlements such as penalty rates and other conditions, the law under Work Choices sanctioned that approach.

Work Choices also restricted the right of employees to join and be represented by a union. It also placed restrictions on the right of employees to collectively bargain. Under the Howard government’s regime, even if every single employee in a workplace freely wished to collectively negotiate with their employer, the employer had no obligation under the law to even speak to them. The implementation of Australian workplace agreements was, of course, a key feature of Work Choices. These, as we know, are statutory individual contracts and they were made under Work Choices the legally dominant form of workplace agreement making. AWAs could be imposed by an employer by making them a condition of employment and by refusing to negotiate any other form of agreement, and I had the experience of representing employees on many occasions where employers used them in that manner. Work Choices also overrode the state industrial relations systems without any attention to the potentially harsh impact and loss of employment conditions for employees affected.

The impact of these changes on employees has been devastating. I saw this at first hand in my former role as ACTU Secretary. People were sacked, for example, in the most unfair of circumstances. With no remedy available to them, the termination of their employment not only undermined their financial security but instilled in them a tremendous sense of injustice. I met many people who had never before paid attention to politics and who had never felt previously motivated to be active in their workplace over their industrial rights but whose experience of Work Choices was the catalyst for significant personal change on their part. The loss of unfair dismissal protection alone awakened within many people a sense of injustice and caused them to campaign on behalf of others as well as themselves. Some of these people participated in the Your Rights at Work campaign coordinated by the ACTU against the former Howard government’s workplace laws. There were people like Annette Virgen, a grandmother from Banyo in Queensland, who was sacked for no reason after nine years of loyal service. Andrew Cruikshank, another person I met, was dismissed from his job for operational reasons under the Liberals’ industrial relations laws. Two weeks later the company readvertised his position at a discount of $25,000 on his previous salary. Arthur Ledwidge was another man that I met. His employment was terminated and he was replaced by contractors on inferior terms of employment. Robert Kirkwood’s employment, along with that of other colleagues of his, was terminated by Cowra abattoir, and they were told to reapply with a 30 per cent pay cut. Emily Connor, a woman I met again yesterday at the National Press Club, was a childcare worker in Canberra. She was sacked without warning and without being allowed to even farewell the children who were in her care. She was given 10 minutes to leave the workplace. Jennifer Gillian, a woman in Queensland, was sacked via text message. Lyn Barnes, a woman in Sydney, was sacked after 25 years without a complaint being made against her, and the list could go on and on and on.

The promotion of Australian workplace agreements also had a devastating impact on the take-home pay of many working families. We need to look no further than the statistics cited in the House by the Deputy Prime Minister a couple of weeks ago. From a sample of over 1,700 AWAs lodged between April and October 2006, we know the following: 89 per cent of them excluded one or more protected award conditions; 83 per cent of them excluded two or more; 78 per cent excluded three or more protected award conditions. The most commonly removed protected award conditions included shiftwork loadings. For example, 70 per cent of the AWAs surveyed excluded shiftwork loadings, 68 per cent excluded annual leave loading and 65 per cent excluded penalty rates generally. These are not just statistics. I know from my direct experience of working with people affected by the use of AWAs what they really meant for working families. There was no obligation on an employer under Work Choices to compensate people for the loss of those employment conditions, and it therefore meant that there were direct cuts in people’s take-home pay. That meant that people had even less influence over their working hours and therefore less capacity to manage their family responsibilities. It meant the loss of people’s dignity as well as their standard of living, and all at a time when the pressure of work was increasing and the costs of living were rising.

The key feature of AWAs is that they can remove award conditions, as I said, without any compensation at all. They can undercut the safety net—and it is crystal clear that that was the intent of the Work Choices legislation.

Opposition members interjecting—


Mr COMBET —There is no fabrication at all. Person after person after person experienced that outcome under Work Choices. The claim by the former workplace relations minister, the member for North Sydney, that members of the former Howard government cabinet did not understand this reality is simply not credible. There is certainly no doubt in my experience that the Prime Minister, at the time of the formulation of the Work Choices legislation, understood perfectly well what it was going to involve, as I had the opportunity to discuss it with him in my former role. There is no doubt that there was plenty of evidence of the disadvantage too, once the Work Choices legislation was introduced, from which members of the former Howard government could have learnt. There was evidence such as the experience of 17-year-old Renee Pitman, from Carseldine in Queensland, who was given an AWA individual contract that took away her penalty rates and overtime. She worked Anzac Day, Boxing Day and the Easter break at a flat rate. A woman from Coffs Harbour named Annette Harris, who worked at the time for Spotlight, lost penalty rates approximating earnings in the order of $90 a week in return for a 2c an hour increase. It is important to note, too, that following a lot of representation on behalf of the employees of Spotlight, Spotlight has now negotiated a collective agreement with the union on behalf of employees to remedy the shortfalls and the approach that they had previously taken using AWAs.

Although the impact of AWAs was felt by many groups across the workforce, the harshest impact—as usual with these things—was on the lowest paid, who are always the most vulnerable to such pressure in the workplace. Despite the perception that AWAs are most prevalent in the mining industry, in fact the majority of AWAs have been made within the areas of low-paid employment. Such people include many women, young people and workers of a non-English-speaking background, and this is the reason that AWAs have also had a negative impact on equal pay for women.

This bill is important in addressing the patent unfairness of the industrial relations system of the former Howard government. The bill amends the Workplace Relations Act 1996 to make a number of changes to the framework for workplace agreements and to enable the process of award modernisation to commence. The amendments will give effect to key government election commitments and begin the transition to a new workplace relations system. Some of the features of the bill include the prevention of the making of new AWAs from the date of commencement of the bill—AWAs made and lodged before the commencement date will continue to operate until terminated or replaced. The bill also will establish a new individual statutory agreement, called the individual transitional employment agreement, for limited use during the transition period only. The bill also implements a genuine no disadvantage test against the safety net for all workplace agreement making, preventing the rip-offs which were a feature of the Work Choices legislation. Importantly, rather than having only five minimum conditions as provided by Work Choices, the bill also provides that, if an existing AWA is terminated, an employee can be covered by a collective agreement at the workplace, if there is one, or alternatively by the relevant safety net award. Where a collective agreement is terminated the employees will be entitled to the award safety net. The bill also allows pre-Work Choices certified agreements to be varied and extended by agreement so the parties to those agreements can avoid any uncertainty created by a double transition to the new system that Labor will introduce. Importantly, the bill also establishes the award modernisation process to create new modern awards as a safety net by 31 December 2009.

The award modernisation process is extremely important and will get underway once the passage of this bill takes place. It will also take into account the responsibility that will have to be discharged by the Australian Industrial Relations Commission and will have to take into account, in modernising awards, the new National Employment standards, because on and from 1 January 2010 Labor’s new National Employment Standards and modern, simple awards will be in operation and there will be not be, from that point in time, any need for individual statutory employment agreements.

The new National Employment Standards include hours of work and reasonable overtime; parental leave, with 12 months unpaid; flexible work for parents; annual leave of four weeks; personal, carers and compassionate leave totalling 10 days; community service leave; public holidays; information in the workplace with the fair work information statement; notice of termination and redundancy; and long service leave. And nothing will deter us from bringing this about. Lastly, the bill will amend the Skilling Australia’s Workforce Act to remove provisions which made funding to TAFE institutions conditional on offering AWAs—and that is a very important measure in the bill.

The changes to the industrial relations system that I have adverted to will not harm the economy. They will simply begin the process of ensuring that there is a fairer set of rights and responsibilities for employees and employers in the workplace. Indeed, there are two important economic reforms inherent in Labor’s policy. Firstly, there is the movement towards a national industrial relations system, which has become possible due to the judgement of the High Court in the Work Choices case. This judgement has extensively redefined the power of this parliament to directly legislate in relation to employment matters by enabling the parliament to rely upon the corporations head of power of the Constitution. Historically, of course, it had been believed that the parliament could only legislate in relation to industrial relations by relying upon the conciliation and arbitration power. This constitutional footing was the basis for a century of somewhat arcane procedures surrounding the making of awards and agreements in the federal system, such as the necessity to create paper based interstate industrial disputes with wide ambit, considerations about the genuineness of paper disputes and that matters contained in awards and agreements related to a strictly narrow definition of the employment relationship. As a former industrial advocate and practitioner, I am pleased that these artificial constraints have been jettisoned by the High Court.

The award modernisation process established by this bill means that awards will be able to operate in a manner akin to legislated minimum standards but will be able to be varied in a flexible way by the responsible authorities and they will bind constitutional employers and their employees. It is to be hoped, to achieve truly comprehensive reform, that the state governments which have not already done so will cooperate as closely as possible with the Rudd government to ensure that all private sector employment is regulated in a national system, because this would be a genuinely significant economic reform, vastly simplifying the multijurisdictional industrial relations environment we have had for the past 100 years.

The second key economic reform represented by this bill is its emphasis upon decentralised workplace collective bargaining. The experience from the decentralisation of the industrial relations system in 1993-94 enacted by the Keating government is that decentralised workplace bargaining, where it is collectively conducted at the workplace, is a key driver of productivity growth—and this country has experienced a decline in productivity growth, with virtually negligible growth in the last quarter of 2007. Continuing to focus the industrial relations system on decentralised workplace bargaining which is collectively conducted, which respects the legitimate rights of employees to sit at the table with their employer and which respects the legitimate commercial interests of employers in that bargaining process is fundamental to productivity growth in the future for this country.

The economic arguments which the coalition has attempted to mount against Labor’s industrial relations changes are nonsense. In a decentralised collective workplace bargaining system, one which respects the interests of employers and employees, we will see improved productivity. The changes will not lead to inflationary wage pressures, and in fact the arguments that have been mounted are somewhat nonsensical. The Deputy Leader of the Opposition, the member for Curtin, has argued that the reforms will drive up inflation by increasing union power—and we heard more about that a moment ago—making it easier for workers to secure big pay increases. That is drivel and nonsense, and that line of argument demonstrates a lack of understanding of the basic economic conditions in which the industrial relations system operates and the nature of workplace-level bargaining.


Mr Ciobo —So they won’t get a pay increase?


Mr COMBET —People will get a pay increase and they will negotiate with their employer about productivity related matters at a workplace level, where employee rights are properly respected and where the legitimate interests of employers and their commercial interests are also properly respected. That is the basis of a decent system.

The real economic problems are those that have been bequeathed to this country by the former Howard government: the skills shortage, the deficit of investment in infrastructure, the lack of fiscal discipline, the failure to encourage innovation and research and development, the failure to prepare for an ageing population and ensure sufficient retirement savings and the poor international trading performance, despite a 60 per cent improvement in Australia’s terms of trade. This is what the former Howard government should have been focusing on rather than exacting punishment on ordinary working people through its workplace relations legislation.

By contrast, the government is focusing on the future and is already well advanced in laying out our framework for a modern economy. At the end of the day, that is very important—looking to the future and laying out the basis for future economic prosperity and fairness and justice in the workplace and the wider society. As a new member it gives me immense pleasure to support this bill, as I know that it will lead to important protections for employees in the workplace and a balanced industrial relations system which also respects the rights of business. I commend it to the House.