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Wednesday, 9 November 1983
Page: 2504

Mr WILLIS (Minister for Employment and Industrial Relations and Minister Assisting the Prime Minister for Public Service Industrial Matters)(4. 04) —I move:

That the Bill be now read a second time.

This legislation represents a further step by this Government towards the implementation of its industrial relations platform and is in accordance with the Statement of Accord reached between the Australian Labor Party and the Australian Council of Trade Unions prior to the Government being formed. It introduces a range of measures aimed at improving the framework of industrial relations in Australia. At the same time the Bill incorporates significant elements of the industrial relations legislation that were introduced in 1982 by the previous Government, and which we supported, but which had not been passed by the time of the dissolution of Parliament at the beginning of this year. I refer in particular to the proposals in this Bill for greater co-ordination between Commonwealth and State industrial systems, the incorporation of the jurisdiction of the Public Service Arbitrator within the jurisdiction of the Conciliation and Arbitration Commission and changes to certain administrative arrangements under the Conciliation and Arbitration Act.

Honourable members will be aware that an essential principle of this Government 's approach to industrial relations is to create a climate whereby any changes that are put forward by the Government affecting the industrial relations framework should first be fully examined by the parties through the National Labour Consultative Council. Accordingly, the provisions of this legislation have been the subject of extensive discussion and examination by the parties through the NLCC; in some cases these discussions have been going on for several years. Apart from an aspect that I will mention later, the legislation has the full support of the NLCC.

When I announced the establishment of the Review of Australia's Industrial Relations system in July, I explained that this decision would not preclude the Government from introducing changes that it considered essential in the short term to overcome aspects of the current arrangements which were seen as deficient or which impeded the day-to-day effectiveness of the system. By its nature this legislation is designed to do just that. I should point out to honourable members that the NLCC considers, with one exception, that all of the matters covered in this legislation should be implemented forthwith by the Government, and should not be delayed until the report of the Review is available in 1985.

The Bill consists of the following elements. First, it provides for improved co -ordination in the work of the Commonwealth and State industrial tribunals through the re-introduction, in identical terms, of the Conciliation and Arbitration (Complementary Industrial Relations System) Amendment Bill 1982. Second, it re-introduces, with certain amendments, provisions of the Conciliation and Arbitration Amendment Bill 1982 relating to term of office, common rules, and casual vacancies. Third, it repeals the Public Service Arbitration Act 1920 and transfers the jurisdiction under that Act to the Conciliation and Arbitration Commission. This is based on the provisions of the Conciliation and Arbitration (Government Service) Amendment Bill 1982. Fourth, it gives effect to proposals that have been agreed by NLCC in recent years but which had not been acted upon by the previous Government. These proposals concern:

Changes to the accounting and financial reporting provisions contained in Part VIIIAA of the Conciliation and Arbitration Act which were agreed by NLCC in 1982 ; and

amendments to the Act to enable certain persons to become or remain members of federally registered employee organisations.

Fifth, the legislation gives effect to some proposals that have been extensively discussed by NLCC this year. These proposals concern:

Changes to the presentation and publication of accounts and related statements by organisations;

amendments to the disqualification from office provisions and to the loans, grants and donations provisions of the Act;

petitioning procedures to be followed in seeking officially conducted elections ; and

clarification of the rule amending powers of committees of management.

Finally, there are several technical amendments which are introduced to overcome certain deficiencies and anomalies that have been identified in various administrative arrangements.

I now turn to examine the amendments in greater detail. The amendments designed to achieve a greater co-ordination between the Commonwealth and State industrial systems are based on recommendations put forward by a Commonwealth-State working party. The previous Government introduced legislation last year to give effect to these recommendations. The changes introduced are in identical terms to those contained in the Conciliation and Arbitration (Complementary Industrial Relations System) Amendment Bill 1982. They provide for:

Joint sittings by single members of the Australian Conciliation and Arbitration Commission and a State Tribunal;

expansion of the powers of local industrial boards-when constituted by a State industrial authority-to permit them to exercise federal conciliation and arbitration jurisdiction; and

the exercise, by agreement, of State jurisdiction by members of the Australian Commission.

In the past attempts to resolve some industrial disputes have been impeded because they have involved both Commonwealth and State jurisdictions. These changes are designed to remove some of the inflexibilities in the present systems so that tribunals concerned might come together to resolve them or authorise a member of one of the jurisdictions to deal with the matter. This issue was addressed at the National Economic Summit Conference when I endorsed the views of other participants on the need for complementary industrial relations legislation as part of our overall prices and incomes strategy.

The Government considers these amendments to be a significant first step in moving towards even greater co-ordination and this issue will of course be one of the major areas to be looked at by the review of Australia's industrial relations system. In May of this year I advised Commonwealth and State Ministers responsible for labour that the Government proposed to reintroduce this legislation. State Ministers also agreed at that meeting to proceed with similar legislation. Already Queensland and New South Wales have enacted, but have not yet proclaimed, legislation to give effect to the proposals. I am confident that each of the other States will proceed as soon as practicable to introduce similar legislation to complement and give effect to the proposals contained in this Bill.

I now turn to consider the proposals for extension of term of office. Under the Act the rules of organisations cannot permit a person to be elected to hold office for a period exceeding four years without being re-elected. This can create difficulties where an officer's term of office is to expire shortly before his proposed date of retirement. Such an officer must either stand for re -election, and serve only part of a term, or retire earlier than intended. The Government believes that organisations should be able to have rules enabling the holder of a full time office, who is due to retire within a period of 12 months after the expiration of the period for which he is elected, to remain in office, if desired, until retirement. Clause 24 gives effect to this proposal. It is in identical terms to that contained in the Conciliation and Arbitration Amendment Bill 1982.

I refer next to the provisions under the Act concerning common rules. The Act provides that the Commission may declare any award or part of an award to be a common rule within a Territory. Once such a common rule is made all the employees and employers in the industry covered by the award in that Territory are automatically bound by the award. The existing provisions for varying such common rules are cumbersome and often result in long delays in passing on to employees the benefit of the award variations involved. In 1981, following representations from the President of the Commission, NLCC agreed to amendments to simplify the existing procedures in relation to common rule variation. Provisions contained in the lapsed Conciliation and Arbitration Amendment Bill 1982 were designed to reflect NLCC's recommendation. However, for reasons of a technical nature, those provisions did not exactly conform with the proposal agreed by NLCC. The relevant provisions of the1982 Bill are reintroduced with the necessary changes to reflect NLCC's recommendations. Clause 12 thus provides that where the Commission varies a term of an award that is a common rule the variation, once agreed to by the Commission, will operate automatically as a common rule and, after a 28 day period for objections, the variation will be enforceable except against those who successfully object.

Another amendment concerns casual vacancies. The Government also considers that the provisions of the Act concerning casual vacancies should be amended to overcome practical difficulties that have been experienced by organisations under the current arrangements. The Act requires the rules of organisations to provide for the election of office holders by either a direct voting system or a defined form of collegiate electoral system. There are no statutory provisions for the filling of casual vacancies in elected positions.

Following consideration of the question of casual vacancies by the NLCC in 1981 , the Conciliation and Arbitration Amendment Bill 1982 contained a proposed amendment to enable the rules of an organisation to provide for the filling of a casual vacancy provided that the unexpired period of office was not more than 12 months. At meetings of NLCC this year, both the ACTU and the Confederation of Australian Industry strongly urged that the 1982 legislative proposals be changed to permit the filling of casual vacancies by appointment for up to three years. The Government considered that the proposal went too far. On the other hand the provisions of the 1982 Bill were, in the Government's view, too restrictive and did not go far enough to overcome the inconvenience and cost currently incurred by organisations in having to hold special elections.

The Government believes it is necessary to achieve an acceptable balance between the need to prevent undue inconvenience and cost for organisations and the need to maintain the principle of democratic control by members and prevent the possibility of abuse and manipulation of the electoral system. The changes introduced by clause 25 provide that the rules of organisations reflect those considerations. The rules may provide for the filling of casual vacancies in elected positions in two circumstances: Firstly, where the term of office is for up to 12 months, then until the expiration of the term; and, secondly, where the term of office is longer than 12 months, for up to three quarters of that term or until the next regular election for the filling of that office, whichever comes first. Where a vacancy is so filled in a collegiate electoral system the person shall be deemed to have been elected to the office for the purposes of participating in a further collegiate election. The effect of this amendment will be to provide the necessary degree of flexibility to organisations in filling casual vacancies whilst at the same time reducing the possibility of abuse or manipulation. Both the ACTU and CAI have indicated their support for this amendment.

I now turn to those provisions of the Bill which repeal the Public Service Arbitration Act 1920 and vest the jurisdiction under that Act in the Conciliation and Arbitration Commission. Apart from certain changes which I will outline below, this legislation incorporates the provisions of the Conciliation and Arbitration (Government Service) Amendment Bill 1982. The legislation gives effect to recommendations of the 1976 report of the Royal Commission on Australian Government Administration. It reflects the principles of integration that were first agreed by the NLCC in 1977. Since the Public Service Arbitration Act was enacted in 1920 to deal with unique features of Commonwealth Public Service employment, the Public Service Arbitrator's functions have changed considerably and jurisdiction has merged to a significant degree with that of the Commission. Some of the most notable changes in that direction have been provision for appeals and reference to the Commission in 1952, transfer of hearing of some claims to the Commission in 1956, dispute notification and settling procedures in 1972 and the filling of the positions of Arbitrator and Deputy Arbitrator by members of the Commission. What is proposed is a natural progression from these developments and will mean that all major employment areas covered by Federal awards will now be regulated by the national tribunal.

There are two substantive changes to the provisions of the 1982 Bill. These changes have the full support of the ACTU, the CAI and the Public Service staff associations. The first change is intended to restore the full scope of the jurisdiction of the tribunal that applied prior to the amendments by the previous Government to the Public Service Arbitration Act in 1978. As a result of this change the Commission will not be constrained from considering matters involving the selection of persons for appointment, re-appointment, employment or promotion in the Public Service. The Government has also decided that it would not be appropriate to restrict the scope of the Conciliation and Arbitration Commission in relation to orders that it may make in the manner proposed in the legislation introduced by the previous Government. Consequently the Bill does not include the detailed provisions concerning the types of orders that may be made by the Commission and the provisions concerning the consequences for employees of being stood down that were contained in the 1982 Bill. The Government is advised that this change in no way restricts the ability of public employers to gain stand-down or no work as directed no pay orders. Public sector employers will still be able to apply to the Commission for such orders in the same way that private sector employers are. This is consistent with the Government's general approach, fully supported by the NLCC, that the position of the Commission in relation to public and private sector employment should as far as possible be the same.

Four other amendments of a minor nature are proposed to the provisions of the 1982 Government Service Bill to remedy technical deficiencies. The Government has also decided to amend the Act to clarify the position regarding membership of federally registered organisations. Once again I should stress that the two amendments relating to this area introduced by the Bill have the full support of the NLCC and were in fact recommendations by that body in 1982. The first amendment, in clause 22, is to take account of amendments in 1979 to the provisions of the New South Wales Industrial Arbitration Act 1940 related to membership of State registered unions in New South Wales. In conformity with the intention of section 132 (4) of the Conciliation and Arbitration Act, the amendment proposed will allow persons able to join a New South Wales State registered union, which is a branch of a Federal union, to become members of that Federal union. The second amendment validates the membership of those who were validly enrolled as members of a Federal union before amendments to the Conciliation and Arbitration Act in 1977 made them ineligible to remain members of Federal organisations. The 1977 amendments aligned more closely the eligibility for membership of State and Federal organisations. The amendment proposed requires that such persons should have had continuous membership of the Federal organisation immediately before and subsequent to the coming into operation of the 1977 Act.

I now turn to the amendments proposed to Part VIIIAA of the Act. This part of the legislation which deals with accounts and audit in respect of registered organisations came into operation at the end of December 1980. The then Government, the ACTU and the employers agreed that its operation be monitored so that any problems could be rectified. The NLCC has identified a number of these problems and the Government has accepted the recommendations for change. The first group of proposals is designed to introduce some flexibility into the requirements of Part VIIIAA concerning presentation and publication of accounts. The amendments do not affect the basic obligations of organisations and rights of members concerned in relation to the supply, presentation and filing of accounts, statements and auditors' reports.

At present an organisation is required under existing arrangements to supply or publish free of charge to each of its members copies of that organisation's accounts, auditors statements and accompanying statement in full. This has imposed considerable cost burdens on organisations; at the same time there is little evidence to suggest that members have derived significant benefits from the provision of such material in this form. The requirements of presentation are not structured to inform a person without some familiarity in accountancy. The Government accepts the recommendation of the NLCC that a more practical and effective arrangement for all concerned would be to give organisations an option to supply summaries of the accounts, reports and statements to their members.

Under the amendments to these requirements, in clause 33, such summaries will be regarded as fulfilling the obligations of organisations under the Act in those cases where:

the summary is accompanied by a notice indicating that members could obtain, free of charge, the full set of accounts, reports and statements of the organisation on request;

the auditor duly certifies that the summary represented a true and fair summary of the accounts, reports and statements of the organisation;

such a summary sets out in full any qualification on the accounts made by the auditor; and

copies are filed with the Registrar.

At present where an organisation is divided into branches, the branches are treated as separate units for the purposes of the financial reporting requirements of Part VIIIAA of the Act. Thus, even in those cases where the Federal body of an organisation under its rules exercises effective control over the financial management of the whole of the organisation, the branches are nevertheless required to present and file separate accounts. The Government has accepted an NLCC recommendation that these requirements are too rigid and impose unnecessary burdens on organisations. The amendments contained in clause 29 are designed to take into account the existence of a number of employer and employee organisations that operate, in financial management terms, at the Federal level.

The Bill provides that the Registrar may upon application issue a certificate to an organisation if he is satisfied that the committee of management of the organisation has by the rules or by practice the right of custody, control or management of assets of the organisation, including assets of the branches. Where a certificate is issued the organisation will be able to comply with the provisions of Part VIIIAA of the Act by consolidating the accounts for the organisation. The amendments proposed do not affect the rights of members under Part VIIIAA. The NLCC is currently developing the details of proposals which would allow organisations with less centralised control of branch assets to consolidate accounts for the purposes of Part VIIIAA if they so elect. Under these proposals branches would retain autonomy and members would be able to obtain details of branch accounts and reports, et cetera on request. I hope to be in the position of introducing amendments to give effect to that proposal in the 1984 autumn sittings.

The Bill also gives effect to essentially technical amendments designed to overcome practical difficulties in the operation of Part VIIIAA identified by the NLCC. These deal with various statutory time limits for presentation of accounts, the appointment of competent auditors and their attendance at meetings , accounting on a cash basis for membership subscriptions, investigations by the Registrar of qualified accounts and procedures relating to the publication of the Federal organisation's accounts in branch journals. Both the ACTU and the CAI have strongly urged the Government to introduce all of these changes as soon as possible to overcome constraints which in their view are totally unnecessary. Another area of amendments relates to the disqualification from office provisions and the loans, grants and donations provisions passed by the Parliament last year.

The Conciliation and Arbitration (Management of Organisations) Act 1982, which introduced those measures, was designed by the previous Government to give effect to recommendations made by the Winneke Royal Commission into the Activities of the Australian Building Construction employees and Builders Labourers Federation. Those recommendations in summary suggested that the Government adopt in the Conciliation and Arbitration Act the same sorts of provisions as in the uniform companies legislation to disqualify office holders and to prevent abuse of the making of loans, grants and donations by organisations. However, the 1982 Act went much further than the Winneke recommendations. For example, it provided for disqualification from holding office in a federally registered organisation where the person concerned had been convicted of crimes relating to damage of property and violence. The range of offences included was much broader than that applying under the companies legislation and had in most cases nothing whatsoever to do with the management of a registered organisation.

The ACTU and the CAI have proposed that these provisions be referred to the tripartite review of industrial relations for consideration. However, proposals have been put to the Government by the ACTU and other interested parties for amendments to the disqualification provisions that should be implemented prior to the report of the review committee as an interim measure. While the Government considers that it is desirable that the provisions be examined by the review it does, nevertheless, recognise that the existing provisions might have the effect of debarring people from holding office because they have been convicted of relatively minor offences or of offences which are not directly connected with the person's fitness to hold office in an organisation; for example, a technical assault or a driving offence. Accordingly, clause 23 amends section 132F of the Act by reducing the range of offences set out in paragraph 132F (1) (B) so that the offences are confined to those relating to elections or ballots under the Act and by changing the basis of paragraph 132F (1) (D) so that the paragraph will refer only to convictions imposed for crimes associated with damage or violence intentionally committed for which a person serves a sentence of imprisonment. Therefore, only criminal offences which the court regards as sufficiently serious to warrant imprisonment will attract the disqualification provisions.

The Government also believes that the loans, grants and donations provisions of the Act should be examined by the review. However, one practical difficulty has been identified by the NLCC which the Government considers warrants immediate attention. The problem with existing section 133B of the Act is that no loan, et cetera, of more than $1,000 can be made without the prior approval of the committee of management. In circumstances where a member or his dependents suffer sudden severe financial hardship, the committee of management may not be able to approve a payment out of distress funds in time to be of assistance to such a person. To overcome this situation, clause 26 provides that a person authorised under the rules of an organisation will be able to approve payment for such purposes up to $3,000, and the committee of management will be able to endorse the payment at its next meeting. This will only apply where the rules of the organisation so provide.

Finally, clause 38 is designed to enable the making of regulations to prescribe a procedure for lodging petitions by members for officially conducted elections. This amendment is to overcome concerns that have been expressed to the Government that the existing procedures are open to abuse. Many of the changes proposed in this legislation are, as I explained at the outset, identical or similar to proposals that were introduced last year by the previous Government but which lapsed. These changes represent important improvements which are designed to meet the Government's overall objective of establishing a flexible and effective framework for the resolution of industrial disputes and for the regulation of the affairs of organisations to the extent that this is necessary. I commend the Bill to the House.

Debate (on motion by Mr Macphee) adjourned.