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Tuesday, 8 October 1996
Page: 3698

Senator CHILDS(8.10 p.m.) —We are discussing the Workplace Relations and Other Legislation Amendment Bill 1996 and Senator Crane in his speech has been referring to a report of the Senate Economics References Committee. Like Senator Crane, I too was a member of that committee and also will refer to that report.

Since 1904 Australia has had a federal industrial relations system. It is based on balancing competing interests, in order to achieve fair and equitable outcomes between employers and employees. The Workplace Relations and Other Legislation Amendment Bill 1996 is not about balancing competing interests; it is about stacking the deck in favour of employers.

Our system of conciliation and arbitration has recognised the collective representation of employees through registered organisations, being trade unions, and of course the collective representation of employers by employer organisations. A fundamental tenet of the system has been a recognition of the imbalance in bargaining power between an employer and an individual employee.

The majority of the Senate Economics References Committee has concluded that, generally, the employment relationship is characterised by a bargaining power imbalance, employers having stronger bargaining powers than employees—and that is commonsense that can be understood by every ordinary Australian. The majority of the committee is concerned that the bill makes changes which undermine the capacity of the industrial relations system and its institutions to redress the imbalance and ensure that employers do not take unfair advantage of that imbalance. This concern influences many of the specific recommendations which appear in the committee's report which I am associated with.

The current industrial relations system recognises the realities of life in Australian workplaces and has delivered unprecedented levels of workplace peace. I declare my interest. I am a trade unionist. I have been a trade union secretary. I will die a trade unionist, just as you probably will, Mr Acting Deputy President McKiernan. I challenge the government senators to declare their interest too, because this is a partisan issue. Unions have played a vital role in representing the interests of Australian workers, and yet the government wishes to force unions out of the bargaining process—and therefore its members show their bias.

The legislation prevents unions playing an active role in the review of certified agreements or Australian workplace agreements. The Labor members of the committee therefore recommend that the bill's provisions concerning the review process for both certified agreements and Australian workplace agreements should be amended to include a right for unions to intervene whenever necessary to ensure that all relevant facts and issues will be disclosed; that the interests of all persons potentially affected by the matter will be protected; or that the interests of the union itself are not affected, before the union has had an opportunity to be heard.

The legislation which is currently in force gives the Australian Industrial Relations Commission a pivotal role. The government has framed the Workplace Relations and Other Legislation Amendment Bill 1996 to undermine the role of the commission. The current industrial relations system, in my view, has received recognition and respect and, most importantly, is acknowledged as achieving important social and economic goals. The Workplace Relations and Other Legislation Amendment Bill 1996 seeks to displace the fundamental principles upon which the current system is based. Yet the majority of the economics committee could find no convincing evidence to suggest that the proposed changes would benefit the economy or provide a basis for a better economic performance than that which has been achieved under the existing legislation.

We have just heard Senator Crane refer to employment. This is the contradiction that this government has created. It promises that this legislation will increase employment—presumably, by lowering wages generally—and yet each week between now and Christmas, we will see increasing unemployment because the cuts that were made under the proposals of the previous government in Working Nation will mean that more and more people are going to be out of work. We will see 5,000 to 10,000 people a month becoming unemployed. So that is the contradiction existing between this government's rhetoric and its practical achievements.

The majority of the committee also notes that the existing system has provided reasonable and appropriate protection for the living standards of working Australians whilst not inappropriately hindering economic performance. The majority therefore concluded that the mixed regulation and flexibility in our current system strikes a balance between necessary flexibility and desirable fairness which, although not perfect, appears more appropriate than moving to a much more deregulated labour market that this legislation will achieve.

If passed in is present form, the legislation would effectively destroy the Australian Industrial Relations Commission. It would hollow out the award system until it collapsed. It would attack workers' rights to collective action. The consequences for Australia will be serious. The consequences for the most vulnerable members of our work force will be disastrous.

As I said earlier, the workplace relations bill attacks the role and functions of the Australian Industrial Relations Commission. The commission has been the means of addressing the inequality of bargaining power between employers and individual employees. It has been the independent umpire.

This bill makes 36 attacks on the role of the commission. Three major examples of these attacks are: firstly, a restriction of the commission's power to prevent or settle an industrial dispute to 18 prescribed matters. The commission's power to make awards dealing with these prescribed matters would be limited to setting minimums only. These minimums would not include conditions that Australian workers should be able to rely on.

The Labor members of the economics committee have concluded that the proposals to confine allowable award matters to 18 matters will preclude the commission from speedily and adequately settling industrial disputes regardless of their subject matter. We believe this will involve considerable detriment to the community as a whole and to the specific parties to an industrial dispute.

We have concluded that the proposals to reduce awards to 18 allowable matters is fundamentally flawed. We are concerned that this proposal would place many existing entitlements outside awards and thus ensure that, without renegotiation, the conditions of employees will be unequivocally reduced. We believe this will ensure another breach of the Prime Minister's rock solid guarantee and every day we see another breach of his guarantees.

We also found that this process of so-called award simplification is arbitrary and deficient, particularly because the legislature purports to declare that the matters outside the 18 allowable matters are in some way less important or less worthy of award protection than those matters in the enumerated list. The Labor members of the committee therefore recommend that proposed section 89A should not be enacted.

The second major issue is that the commission will have no power to make paid rates awards. The abolition of paid rates awards will result over time in substantial real wage reductions for people in essential services like teachers, nurses, academics, community workers, oil and airline industry employees, public servants and emergency service workers. About 1.7 million Australian workers, or 25 per cent of the Australian work force, are on paid rates awards at this moment and they will be affected.

Paid rates awards are vital to a happy Public Service and an efficient Public Service. If you were to go round this city today you would find that the effect of this government just in this one city is to destroy morale in the Public Service. The threat of abolishing paid rates awards that is posed by this legislation means that every public servant is going to be demoralised.

The majority of the committee has concluded that the proposal to abolish paid rates awards fails to appreciate the many benefits that are afforded to employees as a result of paid rates coverage. Paid rates awards ensure that wages are relevant, consistent and secure, that they are enforceable and will be adjusted over time. Where bargaining occurs over and above the paid rates award, the award also provides a comprehensive benchmark for negotiations. The majority of the committee is concerned that the removal of paid rates awards will leave employees worse off—again contrary to the Prime Minister's rock solid guarantee. The majority of the committee therefore recommends that the commission should continue to have the power to make and administer paid rates awards consistent with the existing provisions.

What this government proposes is that each paid rates award will be converted to a minimum rate plus a frozen dollar amount equal to the difference between the minimum and the previous paid rate. This means a substantial component of the wage will be frozen in time never to be readjusted. This could be up to 25 per cent of the workers' pay and conditions.

A third significant example of the attack on the role of the commission is the loss of the power to review enterprise or workplace agreements. Agreements will be secret and lodged with the office of the employment advocate. They will not be examined unless a signatory to the agreement complains. The employment advocate will not release them to any person who is not party to the Australian workplace agreement. The advocate is even prevented or prohibited from informing a non-party to the Australian workplace agreement that a person is or is not a party to an AWA.

Unions cannot inspect an AWA pursuant to the right of entry provisions. That provision in the existing legislation is vital to make sure that if people are being underpaid as far as an award wage is concerned the trade union can come into that enterprise to inspect the books and for the employee not to be victimised. Under the government's legislation, as an aside, people are going to be victimised because they will have to ask the trade union to come into any enterprise.

We also find that academics cannot gain access to the information for the purposes of the research. That is just another example of the sneaky style of this government. Academics or people who wish to study a tenancy or development in any particular industry will have no access to the information because this is a sneaky proposal. It is a sly proposal. It is hidden away from people because we know and the government knows it is designed to reduce wages and they want to disguise that.

The committee, as it went around Australia, was given many examples from the Liberal states' state legislation of where people have been disadvantaged. We have had that evidence before us. The Liberal-National coalition government realises that it is embarrassing; therefore, they will attempt in their legislation to prevent people understanding what is going on with their workplace agreements.

Pursuant to proposed section 83BS, there are penalties of up to six months gaol for disclosing details of AWAs. We had countless examples from the various states of unfair contracts under similar existing state law of Liberal-National party state governments. The majority of the economics committee has concluded that there is an overwhelming case for independent review of AWAs before they come into force. This is the only effective way to ensure that employees, particularly the more vulnerable, have genuinely made the agreement free from any coercion and have been provided with the requisite minimum terms and conditions.

The majority of the committee has also concluded that, although there are other alternatives available, the Australian Industrial Relations Commission is best suited to this task. The commission has the knowledge and the expertise to be able to properly test whether the AWA was genuinely made by the employee and does include the minimum terms and conditions.

The majority of the committee also notes that the bill already provides a reviewing role for the commission in the case of certified agreements. The majority believes that, given that the same test will be applied for certified agreements and Australian workplace agreements, the same body should be given the task of applying that test. This is commonsense. It is a sensible way of using resources, yet this government will not do it. This government proposes to separate the functions. The majority of the committee therefore recommends that this bill should be amended to provide for pre-agreement review of AWAs by the commission.

The government's contradictory position is shown up in cuts of up to 16 per cent to the commission and the Australian Industrial Registrar. At a time when the government are proposing legislation that will qualitatively change everything, they are denying resources to the Industrial Relations Commission. It is just like their claim on employment. It is phoney and it is contradictory. I think when people think about it they will see how genuinely contradictory this government's policies are in industrial relations.

The majority of the committee has concluded that the proposal to abolish the bargaining division of the commission is counterproductive. The bill places greater emphasis on agreement making and therefore increases the need for supervision by the commission. The majority of the committee believes this suggests a greater need for a discrete division of the commission to deal with bargaining matters and not a lesser need, as implied by the bill. The majority of the committee therefore recommends that the bargaining division of the commission be retained.

Attacks on the commission will undermine collective bargaining, promote secrecy at the expense of independent scrutiny, and place a range of restrictions on the proper role of trade unions and their members. The Prime Minister's pre-election rock solid guarantee was that no worker would be worse off under this legislation. Senator Crane talked about the objects of the bill. I challenge him and the government, if they are fair dinkum, to put into the objects that rock solid guarantee: no worker will be worse off. Why not put it into the objects and let us test out the legislation, if it is to be carried? Of course, the government will not do that because the Prime Minister has diluted so much in the manifestation of this legislation. He has promised that no worker will be worse off.

The attacks on the commission will inevitably lead to workers being disadvantaged, as will the hollowing out of the award system. I call it the hollowing out of the award system because Mr Reith and Mr Howard said before the election, `Workers who are currently on awards can choose to remain on them.' That is what he said. Mr Howard said last year in Western Australia:

You give people a choice between an award and a workplace agreement. They can opt out of an award into a workplace agreement. They will not be forced out.

That is what he said in Western Australia, reported on 29 July 1995. This economics committee heard evidence that under state agreements people have been forced out and federal AWAs will achieve the same purpose. They were forced out under the Liberals' state legislation and the same principles are being applied in this bill.

Employees have been pressured directly. They have been offered jobs only on condition that they sign the contract. The majority of the committee has concluded that the proposal to permit employees to enter into AWAs before employment creates the potential for AWAs to be offered on a take it or leave it basis. The majority of the committee is very concerned that this will permit pressure to be applied to vulnerable employees seeking work to accept lower wages and conditions. Who are we talking about here? Primarily young people and women—people not experienced in bargaining and all the other issues involved. They are going to be the people who will be offered employment on a take it or leave it basis. The majority of the committee therefore recommends that this proposal, proposed subsection 170VK(2), not be implemented. The majority of the committee also recommends there should be further consideration of a prohibition on offering an AWA as a condition of employment.

The evidence the committee heard in Western Australia was very interesting. In 1992 John Howard reportedly said he would see throughout Australia an industrial relations system that is largely similar to what the coalition state government has implemented in Western Australia. Some of the worst examples of exploitation were from Western Australia. I think that says a great deal about what this legislation is about. We have seen it in your state, Mr Acting Deputy President McKiernan, and it is very unsatisfactory.