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Thursday, 15 May 2014
Page: 3884


Mr CONROY (Charlton) (12:43): It is always a pleasure to follow the member for McMillan. I might disagree with what he says, but he always raises good points in a reasoned manner and in a genuine attempt to put forward his points of view. I am sure the member for McMillan was a good and decent employer in the private sector when he was there just as he is a good and decent MP now. My concern and the concern on this side is that not every employer is good and decent. We are worried that flexibility sometimes is a one-way street; flexibility is code for the employer making decisions and imposing those on the employees with little regard to the quality of life of those families. I start this by completely acknowledging the very legitimate point of view from the member for McMillan and the points he raised. Some of them I will address before I go into my substantive contribution.

The reason we have industrial relations legislation—in fact, the reason we have trade unions—is a recognition of the fundamental imbalance in the power relationship between employees and employers at the workplace. While there are good employers, and I am sure the member for McMillan was one and still is one as an MP, there are employers who have greater power than their employees and use that power to exploit them for their own advantage. That needs to be regulated so that the workers of this country do not suffer and have the right to earn a decent wage, the right to have legitimate time off with their family, the right to raise their kids and the right to live a good-quality life.

I will touch on penalty rates, because that was touched on before, as well. The member for McMillan talked about penalty rates preventing people from opening up on Sundays, and it is a legitimate concern. But I took my mother-in-law and my wife, who recently became a mother, out for lunch on Mother's Day, and we went to a café that was not a family café. They employed predominantly young women who were uni students and were being paid penalty rates, and that helped them to get through uni. We were happy to pay a Sunday surcharge of an extra 10 per cent on the bill in recognition of the fact that these people were giving up their Mother's Day to work to earn a living. So penalty rates are very important.

I was interested in the comments by the member for McMillan about a hospital. My wife is a nurse, and I spend a lot of time socialising with nurses. A lot of them work outside standard hours to get penalty rates by choice. It often helps family arrangements in that the husband or the wife might able to mind the kids on weekends. But often these families work those hours because penalty rates are the difference between them paying their bills and not paying them. They do not make a choice; they are forced to work these hours to attract the penalty rates to pay the family bills. So any attack on penalty rates is an attack on families' abilities to manage their budget, and that is something we are very worried about.

I was also interested in the previous member's contribution about the auto industry. It is a great tragedy that the auto industry went. It was entirely avoidable. It was entirely due to the current government making a decision to cut funding to that industry—$500 million was cut. Before the last election, Holden said, 'If you cut assistance, we will go'. Anything else is complete rubbish. The member for McMillan makes a very good point that his personal view was that he was not prepared to keep on paying that bill. I understand that point of view. At least it was an honest approach, rather than the fraud conducted by some of his frontbench colleagues. But the auto industry provides a classic example of how the Fair Work Act worked to provide flexibility for workers in the industry.

During the global financial crisis we had a very significant downturn in demand for automotive vehicles; we had all three manufacturers facing constrained demand and the need to take drastic action. They could have simply slashed their workforce, but they worked with their workers and the unions and agreed to use up annual leave, have training days, and work four days instead of five days a week, and they got through the crisis without having to lay off significant numbers of staff. So there was flexibility in the industrial arrangements that allowed that to happen when workers, industry and the unions came together to work in a cooperative manner, and that flexibility exists in the current legislation.

As an aside, the wages in the auto industry were competitive with the rest of the world. They were certainly less than the automotive wages being paid in Japan and Germany and comparable to those in significant parts of the United States automotive industry. Productivity was healthy; we were making great cars. It was a government choice to remove assistance and condemn 50,000 workers to the scrap heap with a huge impact on another 200,000 jobs. That is an aside, and now I will return to the substance of the bill.

As I said, Labor is the party that supports fair workplaces and supports working together with businesses to get the best outcome. We have a proud legacy of industrial relations policies that have strengthened the nation's economy. We have supported workers through fair and equitable social wage systems and have delivered important improvements to pay and conditions that benefit all workers. This is in contrast to those opposite, who have a sordid record of divisive IR policies and a history of stripping away rights from workers. And we are right to be sceptical of their motives regarding this bill.

With the scale of reform represented in the original Fair Work Act, Labor recognised as best practice a review of the operation of the legislation within two years of implementation. The post-implementation review panel consulted widely with unions and employer organisations. The panel also conducted extensive round tables with key stakeholders. Labor has respect for the process, and whilst in government we responded to some of the recommendations eventuating from this review. Before the election, the Prime Minister promised he would not go further than directly implementing the recommendations from this review. However, at first glance it appears that the government is breaking that promise with this bill. The only appropriate course of action with this bill is to refer it to a Senate committee, where the details of the changes can be reviewed properly, because we are right to suspect the Liberals' motives when it comes to industrial relations. Their record is appalling. It is a record of attacks on workers, attacks on workers' rights to organise, attacks on the rights of families to have a decent wage and to raise their kids.

Significant changes to the Fair Work Act are proposed under this bill, including changes to individual flexibility agreements, greenfield arrangements and right-of-entry proposals, and the government has clearly overstepped its election promise by using tricky language to tilt the playing field. Let's take the amendments to the individual flexibility arrangements as an example. IFAs enable an employee to swap a relatively insignificant monetary benefit for a non-financial benefit that suits both the employer and employee. Labor has always supported genuine flexibility in the workplace, and we introduced IFAs because we agree that flexible work practices can deliver benefits to both employees and employers if applied appropriately.

At the same time, however, we made sure low-paid and vulnerable workers were protected by ensuring sufficient safeguards in the legislation so that IFAs could not be a means of ripping away conditions such as penalty rates. The government is now seeking to insert the model flexibility term into all enterprise agreements, but what they are actually doing is abandoning a key safeguard when it comes to what can be traded away through an IFA. The panel recommendation states that if a non-monetary benefit is being traded for a monetary benefit then the value of the non-monetary benefit forgone must be 'relatively insignificant', and the value of the benefit must be 'proportionate'. But these important terms—'relative insignificance' and 'proportion'—are absent from the government's amended bill. That the full recommendation is missing is alarming and is a reflection of what we know the government means when they talk about flexibility. It only heads one way—against the workers.

We only have to look at the WorkChoices experience to get an understanding of that. With WorkChoices the Howard government stripped away crucial support and protection for workers. They stripped away unfair dismissal protections for huge numbers of workers—millions of workers. They stripped away the safety net, and they introduced flexibility. What that flexibility in Australian workplace agreements meant was that employers were able to present on a table to an employee an individual contract—a template not developed in consultation with that worker to say, 'You need these days off because you have family carer requirements', or 'Let's look at this so you will work a shorter day so you can pick up your kids'. It was a boilerplate template of an individual contract and the message was, 'You sign this or you'll get the sack', and you have no unfair dismissal protection. As a former union organiser, I saw this too often. I saw the most vulnerable workers in the community presented with not flexibility agreements but agreements that drove down their wages and stripped away leave entitlements, and they had no rights. I fear that the changes in this bill are the thin end of the wedge, the start of a process where we will get to where we were with WorkChoices.

Another change is the creation of the 'genuine needs' statement, which asks employees to testify that they believe their arrangement meets the needs and leaves them better off overall. Despite being yet another policy position, the Liberal's failed to declare before the election that this appears to do nothing more than set up a legal defence for employers who find themselves prosecuted for breaching the act by leaving workers short-changed.

The Fair Work Act Review panel did recommend the act be amended to provide a defence to alleged contravention of flexibility, but the proposed amendment is not in that spirit. So, while we acknowledge that the Fair Work Act should be, and has been, subject to a review of its operation, the mechanism on the whole is working well. Indeed, the post-implementation review states that in their view:

The current laws are working well and the system of enterprise bargaining underpinned by the national employment standards and modern awards is delivering fairness to employers and employees.

Let us look at the evidence. Over the last five years, Australia's average Labor productivity growth has been twice that of the OECD average. Contrast this to the two periods of sharpest decline in productivity growth, one which occurred under the Fraser government and the second which occurred under the Howard government's very decentralised wages system that attacked workers. Likewise, as noted by the review panel, the number of days lost to industrial action under the Fair Work Act remains within the band of historically low levels. Under the previous Labor government, almost one million jobs were created at a time when the world faced the greatest economic crisis since the Great Depression.

So let us look at the evidence. Under the Fair Work Act, Labor productivity was twice as high as the OECD. Contrast that with the appalling Labor productivity under the Howard years. We had a million jobs created and we had a record low number days of industrial action. Those on the other side are heavy on rhetoric. When you look at the data: the Fair Work Act is working, industrial disputation is low, Labor productivity is high relative to the rest of the world and there is no need to change it except to attack workers.

We are proud of our record in industrial relations. The Labor government in the Hawke-Keating era introduced the prices and income accord. Labor also introduced enterprise bargaining and protected workers' entitlements. The only time those on the other side cared about workers entitlements was when John Howard's brother was involved in corporate collapses and National Textiles.

It was a Labor government that set up a strong and independent umpire in the Fair Work Commission. It was a Labor government that introduced Australia's first ever paid parental leave scheme that was not an entitlement in terms of national welfare; it was a welfare measure which meant that everyone was paid exactly the same wage, not dependent on their income. And Labor fought and broke WorkChoices. On the other hand, we saw the divisive industrial relations system under the Fraser government. We saw WorkChoices under the Howard government. We saw the single most appalling act of industrial relations in 1998 under the Liberal government, the attack on the waterfront, where the government of the day conspired with the employers to illegally sack a mass workforce for no other reason than to break a union.

Everything else is pure mischief—that is the base fact. They conspired with workers to destroy a workforce to break a union. Everything else is rubbish. Since taking office this time, the Liberals have sat idle while more than 63,000 full-time jobs have been lost across the economy. Now they have laid the ground work for a full-blown attack on penalty rates of the hundreds of thousands of casual and part-time shift workers.

As I alluded to before, as a husband of a nurse, I know the importance of penalty rates—not just for manual workers but for white-collar workers in hospitals, for police and for other emergency service workers. Penalty rates are the difference between family budgets keeping families' heads above water or going to the wall. It is sad to say that this is a part of their broader attack on working families through the budget where we see cuts to family benefits and cuts to the pension driving up the price of petrol through more broken promises, attacks on the safety net, a GP tax, a tax on bulk billing and workers paying more for medicines. This is a government that does nothing for workers except attack them and amendments to the Fair Work Act are a part of that process.

Labor is opposed to these amendments because they are not good policy. It is not even good politics to attack workers. It just reveals again the ideological bent of those opposite. Unfortunately, for every member for McMillan, there are 10 on the other side who just do not care about workers.