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Thursday, 4 March 2004
Page: 20817

Senator MURRAY (11:53 AM) —The Workplace Relations Amendment (Compliance with Court and Tribunal Orders) Bill 2003 has provisions which first formed part of the Workplace Relations (Registration and Accountability of Organisations) Bill 2002 but were excised from the bill to facilitate its passage. We should recall that that bill is one of the only bills—apart from the youth rates bill, I think—which has been negotiated between the Labor Party and the government in the last eight years. These provisions were very much not to the liking of Labor then and are obviously not to the liking of Labor now.

The bill aims to ensure that officers and employees of registered organisations abide by the rulings of the Federal Court of Australia and the Australian Industrial Relations Commission—an obviously commendable objective. But what does the detail say? Specifically the bill creates a number of new civil penalty provisions applying to the officers and employees of organisations who subvert an order or direction of a court or tribunal. It provides for the automatic disqualification of persons for five years—unless leave has been obtained from the Federal Court—from holding office, election to office or appointment to office if the court has imposed a pecuniary penalty on that person for matters outlined in the bill. It provides for the minister or a person authorised by the minister in writing to apply for a court order in respect of an alleged contravention of the civil penalty provision of the Workplace Relations Act. These are serious provisions and extend the powers under the act quite considerably.

We should note when we are debating these matters that there are already serious disqualification provisions in the Workplace Relations Act. It is not as if we are debating a situation where there is a void in the law or in the penalties. If we look at the current disqualification provisions in the Workplace Relations Act 1996, they are, however, limited to offences that are criminal or relatively serious in nature. These include any convictions for fraud or dishonesty with penalties of imprisonment for more than three months, violence towards another person, intentional damage to property and a series of offences within schedule 1B. That series includes matters such as failing to comply with electoral official requests for information, interfering with ballots so as to commit electoral fraud, or threatening or discriminating against anyone seeking the conduct of an election for office. The Bills Digest correctly states that it is arguable that adding the failure to comply with civil obligation orders such as return to work orders will lower the threshold.

The government argues that this bill will provide more effective sanctions, yet we already have sanctions at section 178. The question is—and I think this was the theme of Senator Collins's speech—whether there are, if not intended consequences, unintended consequences which would severely limit the ability of union officials to do their job. That is the essential argument before us. We did touch upon the existing sanctions at section 178 in an earlier debate this week. The Democrats attempted to increase the penalties in section 178 in another bill, but both Labor and the coalition voted them down. There is an interesting swing around of positions on these things as we proceed through these bills.

As I said in my speech in the second reading debate for the Workplace Relations Amendment (Codifying Contempt Offences) Bill 2003 yesterday, the Democrats do believe that the rule of law must apply and have supported, in many instances over the years, strongly enforcing the rule of law. If the law is being flouted and it is not a question of enforcement or the resources needed for enforcement, we will support stronger law. But increased sanctions must only be justified where there is sufficient evidence that a real and significant problem exists.

We are not presented with sufficient evidence, in our view. That does not mean that I am dismissing or condoning those defiances of the law that occur and the occasions where they occur. I am sensitive to the financial impact this can have on employers or industries. But ultimately it is the courts and sometimes the magistrates themselves rather than the judges that determine these matters. There have been instances where people who have damaged property have been brought before a magistrates court and have been either fined or let off, so the law is working. The question may be, of course, whether the penalties are adequate, but that is a different issue. We have to be realistic. We have to recognise that there needs to be a balance struck between preventing financial loss to the employer and causing the loss to employees of one of the weapons at their disposal, namely the weapon of direct action.

For the Democrats to even consider such a serious penalty as proposed in this bill, we would have to see evidence of rampant or repeat offenders of noncompliance of court and commission orders. As we have noted at other times, these matters are before the Senate committee inquiry into the Cole royal commission and its consequent legislation, and we do think that the conclusions of that committee should influence the view as to how much evidence there is of rampant or repeat offenders of noncompliance. We would urge the government to provide that committee with as much evidence on that front as possible. In a sense, this bill comes before it should and, in a sense, its considerations are also part of that bigger Cole issue. As discussed already in my speeches in two second reading debates to previous bills this week, the government has not provided us with sufficient evidence at this time, and we do not see that that evidence is in the public arena.

I want to briefly outline the concerns we have with the three proposed areas of the bill and then I want to go on to discuss the problems of the bill in the context of what I refer to as the bigger picture. I will start first with the scope of orders and directions for which offences and disqualification could apply. The proposed provisions of this bill apply to any order or direction of the commission or court. In their submission to the Senate inquiry into this bill, the ACTU argued that `orders and directions' were ill defined in the Workplace Relations Act and used loosely in the functioning of the Industrial Relations Commission. This, the ACTU argued, may lead to uncertainty, as parties will not know whether an order or direction of the IRC or a court is an order or direction attracting a civil penalty for noncompliance.

If we are going to envisage a situation where serious penalties shall apply, the circumstances under which those penalties kick in do need to be carefully defined. This is especially the case, given that the IRC will often make recommendations to parties—for instance, to conference—with a suggestion that failure to do so may lead to them imposing an interim award on the parties. The policy problem, which the ACTU also raises, is that the application of the provisions to all orders and directions has the potential to impose onerous penalties for minor breaches—for example, a failure to comply with a procedural deadline. In response to this, the government have argued that commissioners surely would not impose a penalty for a minor breach. However, there is no guidance for commissioners as to what type of order or direction a penalty should apply to if breached, and it is with the penalties which might be on the cusp of falling one way or another that you need to be careful. We are therefore cautious about the effects of this provision. We do acknowledge that this area could possibly be tightened up to address these concerns.

With respect to the disqualification provisions, I note that the existing disqualification from holding office under part 4 of chapter 7 of the Workplace Relations Act applies only in cases of conviction for certain criminal offences, including fraud, intentional violence, certain ballot offences and offences in relation to the formation, registration or management of an association or organisation. This bill would extend the application of automatic disqualification to civil penalty provisions. Another area in which I have responsibilities is the Corporations Law. There is no similar provision in the Corporations Act, where it is the regulator who has to make out a case for disqualification. The government argue that disqualification can only occur for breach of these duties where the Federal Court, in its discretion, considers that the conduct warrants the imposition of a pecuniary penalty. As outlined above, the commission has no guidance as to what orders and directions penalties should apply to and, even if more guidance were given, automatic disqualification for a civil offence would still be very serious.

The government has argued that there is a process to appeal the automatic disqualification. I would like to point out here that, in the case of breaches of civil penalty provisions under the Corporations Law, the regulator, ASIC, carries the onus of satisfying the court that disqualification is appropriate. This should be contrasted with the proposal in the compliance bill that the onus and cost is on the disqualified person to convince the court that he or she should be given leave to hold office. Maybe the reason that those two are so different is that, in the case of the Corporations Law, at least we have the sanity of a national regulator, whereas in the case of industrial relations matters we have not so much insanity but a lack of wisdom which results in a dispersed inspectorate and a dispersed regulatory ability.

The final area of the bill relates to the minister gaining authority to seek orders. Currently, applications for orders for breaches of penalty provisions can be made only by the Industrial Registrar or an organisation. The government argue that the amendment is in recognition of the costs and delays that may be involved in enforcing orders and directions and that parties are sometimes pressured not to pursue available sanctions and remedies. However, the provision appears to be contrary to the government's espoused philosophy of keeping third parties out of industrial relations, which the Democrats have supported wherever it is appropriate. There does not appear to be a similar provision in Corporations Law. Again, instead, it is the regulator that pursues such matters.

Instead of the employer having to pursue matters and to be put in some commercial and perhaps commercially political embarrassment, if I can use that phrase, we think there should be circumstances which would enable the Industrial Registrar to monitor the payment of a penalty and the compliance with an order and notify nonpayment or noncompliance to the Federal Court for further action. In other words, we advocate proper monitoring and automatic referral back to the very body which we think should enforce these laws. It is quite plain to us that there are circumstances in industrial relations behaviour where employees or employee organisations or employers or employer organisations can find themselves under some stress not to force an issue because of the commercial consequences. Frankly, it should be taken out of their hands, and we think the Industrial Registrar should be given a greater role to play in this.

In addition to the issues I raised earlier, I also think we should examine the big picture in considering this bill and indeed other workplace relations bills that are before the parliament. First, the Senate has to consider whether the proposed offence is justified and, importantly, what effect it will have on the legitimate role of unions and union officials, which is to protect the rights of employees and to pursue their interests. It is very important to maintain the ability of the men and women who are union officers, both paid and unpaid, to do an essential job without an unreasonable fear as to the risk of doing that job.

One has to wonder what impact this bill could have on the ability of union officials to perform their job and adequately represent employees. I am referring to what I think Labor might categorise as intended consequences, namely restricting their abilities even more, or unintended consequences, namely closing down what is a flexible and, in my view, a fairly well-operating environment. So how are union officials meant to represent members who want to renegotiate wages and conditions, and protest unconscionable behaviour, and who might face the situation of losing their job or being made redundant, or workers who have their working conditions unilaterally changed or who feel they need to apply pressure in terms of work and safety issues or whatever? How are they to behave when they are in fear of being disqualified from their positions? We must bear in mind, as I have said earlier, that we do have disqualification provisions for proper cause already in the act.

Everybody, even Labor, gets irritated with some unions and some unionists sometimes. But that is a part of life. In the end unions and employer organisations play an absolutely essential and valuable role in Australian society. We know that occupational health and safety, productivity, efficiency and good working standards are better on sites or in organisations or enterprises when unions and employers are able to work productively together. We know that compliance with the law occurs when these things are policed by unions and employer organisations. A World Bank report last year showed that in highly unionised areas there was less inequality, decreased wage discrimination against women and minorities, and improved economic performance. The great virtue of the Australian system is that industrial disputation is recognised as an essential part of the bargaining and market process, and parties to disputation have procedures and the opportunity to work matters through. So the bill is concerning if it shifts that balance, if it affects that outcome, and the government do themselves a disservice if they do not recognise those—perhaps unintended, perhaps intended—consequences.

Yes, the bill does apply to registered employer organisations, but employer associations or organisations are rarely direct participants in industrial action—it has no practical effect on them. The bill has gone down the path of addressing an area but ignoring other areas. We are happy to discuss the principles that surround these matters, but I must return again and again to a theme I am trying to hammer home hard in the workplace relations and industrial relations arena, the circles in which I move and the environments in which I operate. I am a firm believer that we need one unitary system of industrial relations. We cannot have any system of industrial relations unless we have strong regulators which are able to enforce the law and are sufficiently resourced to do so.

In contrast to other sectors, where the national interest is paralleled by national laws with a national regulator, such as finance, where there is APRA and the Reserve Bank, Corporations Law where there is ASIC, competition law where there is the ACCC and tax where there is the ATO, in workplace relations you do not have the national interest served by a national law and you do not have a national regulator. My view is that many of the provisions and penalties of the existing act would be far better exercised and far better implemented if only there were somebody to enforce the law as it is at present. My concern is that the government keeps seeing a problem and introducing more law when the real problem is something quite different. The real problem is that no-one is enforcing the existing law. No-one is doing the job that has to be done right now to make sure that entitlements are paid, that wages and conditions are observed, that health and safety is looked after and that people do not defy court and commission orders and other principles. We really do have a strong act. The penalties can certainly be improved and, as you know, we voted for that to happen, although the bill went down overall. But I do have a serious concern that we are going in an antilibertarian direction when we should be going towards enforcing existing law and making sure we have the regulatory instruments to carry through the law as it stands.