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Monday, 17 March 2008
Page: 1026


Senator BUSHBY (9:12 PM) —In any consideration of the Workplace Relations Amendment (Transition to Forward with Fairness) Bill 2008 I believe that regard must be had for how we arrived at where the national industrial relations law is today. The post-1983 approach by the Hawke government was based on an accord it had negotiated with the ACTU. The accord was designed to solve early 1980s economic problems and championed consensus between employers and employee organisations. Underlying the accord was the belief that the health of the economy could be restored by a centralised system of industrial relations regulation linking wage rises to inflation and administered by the Australian Industrial Relations Commission. Over the course of the 1980s it became apparent that this approach had failed miserably, leading to increasing unemployment, failure to achieve productivity gains, poor wage growth and contributing to the worst recession since the Depression, with over a million unemployed in 1990.

The concept of agreements negotiated between employers and employees outside the orbit of industrial relations tribunals gained favour throughout this period, particularly in business circles, and was adopted by the coalition as policy in the late 1980s and refined throughout the early 1990s. The coalition took clearly articulated policies advocating individual workplace agreements to the 1996 election under the Better Pay for Better Work banner. That year the Workplace Relations and Other Legislation Amendment Act 1996 was passed, following compromises with the Democrats and despite it being opposed by the then Labor opposition. One of its objectives was to ensure that the primary responsibility for determining matters affecting the relationship between employers and employees rests with the employer and the employee at the workplace level. It took the prescriptive award system and gave businesses and workers greater choice in negotiating working conditions. For the first time ever employees were able to have their own individual agreements—Australian workplace agreements. Since then, over 1,300,000 Australian workplace agreements have been entered into.

The legislation also introduced freedom of association laws, guaranteeing workers the right to voluntary union membership. Unfortunately, this was too late for me; I had no hope of getting back the fees that I was forced to pay to the BLF, the Federated Clerks Union and the Storemen and Packers Union whilst I was at uni—and for absolutely no benefit whatsoever. But workers voted with their feet, leaving barely 15 per cent of the Australian workforce deeming the benefits received worth the membership fee. The Howard government then went on to seek to build on the success of the 1996 changes. Over the ensuing 10 years, it repeatedly attempted to pass into legislation further IR changes—over 40 attempts, relating to a number of matters intended to make a fairer, more flexible system such as exemptions to unfair dismissal laws for small business.

Following the 2004 election, the people granted the coalition a majority in the Senate. Using the mandate given by this majority, it sought to build on the success of the previous IR reforms, with major changes which replaced the system designed a century earlier, introduced a national system replacing over 4,000 awards and 130 pieces of legislation in six different outdated systems around Australia; vastly improved cooperation, lowering the average of working days lost through industrial unrest from an average of 193 days per 1,000 in 1996 to 15 in 2006; being much fairer, with small business finally given the confidence to employ people following the removal of Labor’s job-destroying and anti-employment unfair dismissal laws; and delivered both more jobs and higher wages due to the increased productivity the more flexible laws introduced and enabled.

The results of the Howard government changes were rapidly very readily apparent. As at late last year, the following could be said: working families were clearly doing better under this system, whether they were on enterprise or individual contracts. Real wages increased by 21.5 per cent between 1996 and 2007. Three per cent of this rise occurred after the introduction of the new workplace relations system. More than 430,000 jobs were created in the 18 months following the introduction of that system—nearly 80 per cent of them full-time jobs.

A key benefit of the changes made to the IR system since 1996, particularly including the most recent changes, is the improvement they made to adding to the economy’s supply-side capacity. Shortly after their win last year, the government came up with the plan to rewrite history on the economy, in an attempt to try to win some of the economic moral high ground. The tool they have been using to do this is the fact that underlying inflation has exceeded three per cent in recent months. They have said that, because this figure is outside the target band agreed between the RBA and the Treasurer, the economy is in terrible shape. This is, of course, a total overdramatisation and nothing but an attempt to unnecessarily and cruelly scare the Australian population into believing we are facing disaster. The fact remains that the index for the target range for inflation is the headline rate of CPI, not the underlying rate, and that this remains within the target range of between two and three per cent, albeit trending towards the upper level of that band. As such, although action may be required to maintain the rate within that band, we do not currently face extraordinarily concerning levels of inflation—and certainly not in the sense that we have seen under Labor as recently as the 1980s, when it was well into double digits.

Be that as it may, the main criticism that has been levelled at us for failing to address this ‘inflation problem’ was that we failed to address supply constraints—particularly in respect of labour shortages. But, as confirmed by Treasury in the recent additional Senate estimates, the introduction of increased flexibility in the labour market is a key tool in addressing shortages in skilled labour. One of the primary reasons for the introduction of the new workplace changes was to deliver just that: increased flexibility that would allow more people to negotiate employment conditions that would suit them and allow them back into the workforce, while at the same time improving productivity through employers being able to hire employees on conditions that best suited their specific needs and thereby helping to alleviate the supply-side constraints in the economy.


Senator Chris Evans —We’ve done well in Tasmania.


Senator BUSHBY —We will get to that. Together we created a situation where everyone was a winner, including the economy—


Senator Chris Evans —It is called five million.


Senator BUSHBY —Actually, if you look—


The ACTING DEPUTY PRESIDENT (Senator Murray)—Order! Senator Bushby, do not respond to interjections; it is disorderly. Continue your remarks.


Senator BUSHBY —I would like to make one small point, and that is that the swing against the then government in Tasmania was the smallest of any state in the country; we just had very small margins. Of course, the unprecedented campaign against the new workplace changes by both unions and the Labor Party contributed significantly to the coalition’s loss last year. Never before have we seen anything like the third-party spend of $30 million on TV advertising alone. It is creating a huge precedent that I think is particularly concerning for the future of democracy in this country.

But the reality was that most—no, all—of that campaign constituted a scare campaign, leading to voters building a totally distorted and incorrect view of the reality of the effects of the new workplace system. The facts are that the system as it currently stands as enacted is actually more regulated and provides more protections than similar countries, such as the UK and New Zealand. At the same time, our system is giving people the option of having more flexible working arrangements which suit the modern workplace and help Australians balance work and family life. For the first time, in law, all employees have the following entitlements: a national minimum wage and minimum rates of pay according to award classifications; four weeks annual leave per annum; 10 days personal carers leave, including sick leave, per annum—locked in, in law; up to 52 weeks unpaid parental leave, including maternity leave; maximum ordinary hours of work of 38 hours per week, which can be averaged; and a fairness test that ensures employees receive fair compensation—in most cases a higher rate of pay—if they agree to change protected award conditions, including penalty rates, shift and overtime loadings, monetary allowances, annual leave loadings, public holidays, rest breaks and incentives based payments and bonuses. All employees have the right to have a bargaining agent to assist them in negotiating a workplace agreement. A ‘bargaining agent’ can be a friend, a relative, a union representative or a lawyer. Employees cannot be forced to sign an agreement or change their existing agreements. It is against the law to force an employee to sign an AWA. What is more, employees under 18 years of age must have the written consent of a parent or guardian before signing an AWA.

All employees, regardless of business size, are protected against unlawful termination. You cannot be sacked for a temporary absence from work because of illness or injury or because of your trade union membership or participation in trade union activities. You cannot be sacked for nonmembership of a trade union. You cannot be sacked for seeking office as a representative of employees or for filing a complaint against an employer. You cannot be sacked because of your race, colour, sex, sexual preference, age, physical or mental disability, marital status, family responsibilities, pregnancy, religion, political opinion, national extraction or social origin. All of those are protected, and sacking for those would be unlawful termination. Similarly, you cannot be sacked for refusing to negotiate, sign, extend, vary or terminate an AWA, even if, as Senator Wortley was saying before, an employer chooses to draft one that is the same for every employee in the place. If an employee refuses to sign it, they cannot be sacked. You cannot be sacked for an absence from work during maternity leave or other parental leave. You cannot be sacked for temporary absence due to voluntary emergency management activity.

In terms of unfair dismissal, as opposed to unlawful termination, employees who have worked for at least six months for a business with over 100 employees have the right to bring an unfair dismissal case. Employees have the right to join—or, more importantly, not to join—a union. Equally, employees have the right to take lawful industrial action when negotiating an agreement. Employees cannot be sacked, demoted or be denied shifts because they have a certain type of agreement or have made an inquiry or a complaint about their rights at work.

The government now claims that it has a mandate under which the opposition has no choice but to support the government’s IR legislation. With respect, I do not agree. It is quite clear that the government is trotting out the old mandate catchcry to support its own political ends, when it has always been the worst serial ignorer of mandates delivered to governments other than its own. The most obvious is its rejection of the clear mandate provided to the Howard government following the 1998 GST election. Just 25 days after that election, then opposition leader, Kim Beazley, promised that Labor would oppose the GST lock, stock and barrel—25 days after the election, when the people had given us the mandate. He said, ‘We will manoeuvre tactically in whatever way we can to try to procure the defeat of this GST legislation.’ Prime Minister Kevin Rudd declared in 1999 that the introduction of the GST represented:

… a day of fundamental injustice … the day when the parliament of the country said to the poor of the country that they could all go and take a running jump.

This is despite the government having been given a clear mandate to introduce that legislation by the very people he was talking about. I note that Prime Minister Rudd is silent on the GST even though he now has the power to change it.

Throughout the Howard years, the Labor Party consistently voted against the privatisation of Telstra, despite the coalition winning the 1996, the 1998, the 2001 and the 2004 elections on a platform of privatisation. And of course in the Senate, Labor voted against the Howard government’s 40-plus attempts at unfair dismissal industrial relations reforms despite the party having taken this policy to the people and winning in 1996, 1998, 2001 and 2004. Where was Labor’s commitment to a mandate then? Why was Deputy Prime Minister Gillard not decrying any suggestion of Labor’s rejection of these measures as a slap in the face of democracy or of the people? They were nowhere, because a mandate means nothing to them unless it suits their own grubby political purposes. The fact is that the opposition has been provided with the level of representation it has in the Senate by the people. It is incumbent on the opposition to use that level of representation as it deems in the best interest of those people. Success of parties in the other place and the policies and platforms they espouse prior to their success should not constrict the ability of members of this place to consider decisions before them on the merits. It would be wrong to do so and the fact is that so-called ‘mandates’ should be only one of the factors considered by members of this place when deliberating over matters before them.

This bill purports to remove AWAs, a measure introduced by the Howard government 12 years ago and, as noted, working very well with over 1,300,000 people having taken them up. But the reality is that, despite the Deputy Prime Minister saying she would remove individual contracts, this bill includes individual contracts which, although labelled as temporary, will run indefinitely in effect for those who have entered into them. It also remains to be seen how much of the 2006 new workplace changes they retain. It is almost certain that much of that which they campaigned against in the last election will be retained and I look forward to examining future IR legislation in that regard.

But the fact remains that the IR changes introduced by the Howard government were intended to promote reduced unemployment, better and more flexible conditions for workers and employers, better pay in return for higher productivity, greater flexibility and productivity in the overall workforce—thereby addressing significant supply-side constraints in the macro economy and reducing inflationary pressures—and were driven by a desire to deliver real, practical outcomes for the benefit of all Australians. And it is also a fact that these changes delivered these benefits and more. The opposition to this could only have been driven by ideological dislike and to protect the patches of unions and their apparatchiks, yet the most recent changes did provide much ammunition to inaccurately and dishonestly feed a scare campaign against them.

In time, the wind back of any of these changes will prove to be to the detriment of the people of Australia. It is particularly sad that this bill purports to remove that which was introduced almost 10 years prior to the new workplace reforms and which had been working brilliantly at that time. The fact that AWAs got caught up with the hysteria dishonestly created over Work Choices is a great shame. IR laws need to have the flexibility to deliver what is required by the circumstances at the time. Economic theory states that full employment can be achieved where there are no restrictions or regulations placed on employment, but in such a case the conditions to employ the last of the unemployed will be less than what we as a nation are prepared to accept. As such, as a nation, we all agree on the need for some regulation to protect workers from exploitation, but we need to ensure that an appropriate and fair balance is struck. In times of high unemployment the balance needs to lean more towards employees who are more susceptible to exploitation in such circumstances. Similarly, in times of low unemployment, the balance needs to shift in favour of employers to avoid unwelcome economic consequences such as excessive wage inflation, low productivity in a tight labour market and general inflationary pressures. I have concerns where the passing of this bill will lead, but I understand and accept that it is likely to be passed. I will not object to that course.