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Wednesday, 20 February 2002
Page: 504

Mr ABBOTT (Minister for Employment and Workplace Relations and Minister Assisting the Prime Minister for the Public Service) (9:46 AM) —I move:

That this bill be now read a second time.

In reforming the workplace relations system, the government has ensured that Australia has workplace relations arrangements that sustain and enhance our living standards, our jobs, our productivity and our international competitiveness. The government has also promoted a more inclusive and cooperative workplace system where employers and employees are able to make agreements on wages, conditions and work and family responsibilities subject to a safety net of minimum standards.

Australia's system of genuine workplace or enterprise level bargaining has underpinned these achievements. The overwhelming majority of Australian employees in the federal workplace relations system are now employed under enterprise or workplace agreements—whether collective or individual.

Enterprise bargaining has produced benefits for both employees and employers. Employees have gained better wages, more relevant conditions, more jobs and greater workplace participation. At the same time, employers have gained higher productivity, increased competitiveness and lower industrial dispute levels.

Significantly, the outcomes from this system have been far superior to those of the centrally controlled system which preceded it. Over the life of the coalition government, the lowest paid workers dependent on award rates of pay have received safety net adjustments of $64 a week, or a nine per cent increase in real wages. This contrasts markedly with the five per cent decrease in real wages for low paid workers which occurred under the previous 13 years of Labor government.

Workplace bargaining has attracted bipartisan political and industrial support at federal and state levels. The previous Labor government and the ACTU both adopted enterprise bargaining as policy in their Accord Mark VI in 1990, and pursued it vigorously in industrial tribunals, legislatively and publicly.

For all of the deficiencies of the previous Labor government, for all of the inadequacies of the bargaining model implemented at that time, Labor knew what we all know—that workplace bargaining is a structural reform that benefits Australia.

Employers and employees have clearly embraced workplace bargaining in the past decade. More than 41,000 collective agreements have been formalised under the federal system alone, with thousands more under state bargaining systems. Over 1.3 million employees are covered by current federal wage agreements, including those on one of the 220,000 individual agreements made since March 1997. Agreements made directly between employers and their employees, with limited third party involvement, are increasingly being used as a vehicle for better wages and flexible and innovative employment conditions and work practices.

This bill will ensure that enterprise bargaining continues to benefit employees with more jobs and better wages, and employers with higher productivity, increased competitiveness and fewer strikes.

Bargaining Periods

Workplace bargaining helps the economy because wages and conditions are determined by genuine workplace negotiations by employees and employers with outcomes based on local knowledge and circumstances and mutual interests. However, elements within the union movement have attempted to orchestrate a return to industry level bargaining through the process known as pattern bargaining. Unions use pattern bargaining to conduct their negotiations across a range of employers or an industry and do not genuinely negotiate at an enterprise level.

Pattern bargaining ignores the needs of employees and employers at the workplace level. It represents an outdated, one-size-fits-all approach to workplace relations where union officials utilised the centralised system to dictate their agenda to both employers and employees. This discredited approach works against the goal of an inclusive and cooperative workplace relations system that sustains and enhances our living standards, our jobs, our productivity and our international competitiveness.

This bill would not prevent unions from making the same claims over a number of employers. However, it does reinforce the Industrial Relations Commission's ability to end protected strike action by suspending or terminating bargaining periods if unions are not genuinely bargaining about their claims at the workplace level.

The bill draws on the commission's decision in Australian Industry Group v. Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union & Ors where the commission drew a distinction between unions making common claims across a number of employers and unions refusing to bargain at the workplace level.

The bill would insert a new subsection 170MW(2A) into the Workplace Relations Act 1996 which would list a number of factors that the commission would have to consider when it is determining whether, for the purposes of the act, a negotiating party is not genuinely trying to reach agreement with the other negotiating parties. These factors would not be exhaustive nor would they necessarily decide the issue on their own.

This bill would also insert a new section 170MWA, which would apply in circumstances where an earlier bargaining period has ended because the initiating party has given notice to withdraw the bargaining period, to deprive the commission of jurisdiction to hear a case. It would empower the commission to make orders to prevent the initiation of a new bargaining period or to order that conditions attach to any such bargaining period. Before issuing such an order, the commission would have to give the former negotiating parties the opportunity to be heard and conclude that the making of an order is in the public interest.

Cooling-off periods

During protracted disputes, antagonisms can become entrenched and parties can often lose sight of their original objectives. Cooling-off periods allow negotiating parties to take a step back from industrial conflict and to refocus on reaching a resolution which works for the business in question.

Currently the commission does not have the specific ability to order a cooling-off period in the case of a protracted dispute. The commission has used the provisions of section 170MW to order de facto cooling-off periods, to provide a circuit breaker in particularly difficult bargaining disputes, but it is not able to do this in all situations where a cooling-off period may be warranted.

The government believes that cooling-off periods should be given statutory recognition because of their potential to refocus negotiations. Accordingly, this bill would give the commission discretion to suspend a bargaining period for a specified period, on application by a negotiating party.

Proposed paragraph 170MWB(1)(c) would require the commission to consider a number of factors to determine whether a suspension is appropriate, including:

whether suspension of the bargaining period would assist the parties in resolving the issues between them; and

whether suspending the bargaining period would be contrary to the public interest or inconsistent with the objects of the act.

Proposed subsection 170MWB(2) would make it clear that the duration of a cooling-off period is a matter for the commission's discretion. In considering the application, the commission would give the negotiating parties an opportunity to be heard.

The commission would be able to extend the cooling-off period on the application of a negotiating party, after hearing the other negotiating parties. In determining whether to extend a period of suspension, the commission would consider:

the factors required to be considered when first ordering a suspension; and

whether the negotiating parties genuinely tried to reach an agreement during the period of the initial suspension.

Only one extension of the cooling-off period would be allowed, at the commission's discretion. There is no prescribed duration for a cooling-off period as the appropriate length of a suspension or extension will vary according to the nature of the dispute and the industry in which the dispute occurs.

If the commission suspends the bargaining period, or extends the initial suspension, the commission will have to inform the negotiating parties that they may choose to attend private mediation or ask the commission to conciliate the dispute.

This bill reinforces the positive trends of more jobs, better wages, higher productivity, increased competitiveness, and fewer strikes. The government's workplace reform has brought these benefits to the Australian economy and the wellbeing of all Australians. We cannot afford to allow these gains to be neutralised or wound back for the benefit of radical elements within the union movement. The bill is a moderate but necessary reform to ensure this does not occur and I commend it to the House and present the explanatory memorandum.

Debate (on motion by Mr Cox) adjourned.