Labor’s industrial relations bill: how will it change Australia’s workplaces?
Workplace relations minister, Tony Burke, has unveiled Labor’s secure jobs, better pay bill, revealing the wide-ranging changes to industrial law that have sparked employer backlash.
The Albanese government says the bill is needed to get wages moving again, but how will it do so and what hoops will unions need to jump through to negotiate a pay deal, if it passes?
Multi-employer bargaining
The bill replaces the existing lowpaid bargaining stream with the “supported stream”, a simpler way for workers in sectors such as community services, cleaning, and early childhood education and care to negotiate one pay deal across multiple employers.
The bill also expands the “singleinterest stream” by allowing the Fair Work Commission to authorise workers with common interests to bargain together, where it is in the public interest for them to do so.
Controversially for employers, both these streams could allow unions to apply to compel them to bargain together if the move has the support of the majority of employees, subject to some exceptions, including that small businesses can’t be forced into the single-interest stream.
Both are also backed by the right to strike, subject to all the current hurdles such as balloting. Adelaide University’s professor of law, Andrew Stewart, said that “in theory” employees across an entire industry, such as childcare, can take strike action “but in practice, it’s only going to be employees represented by a union”.
The bill requires conciliation before protected action can be taken and 120 hours’ notice for strikes in relation to multi-employer bargaining.
A third option, the cooperative bargaining stream, is voluntary, allows parties to stop bargaining at any time and has no access to industrial action.
Employers who already have an enterprise agreement with their staff won’t be able to be compelled to join multi-employer pay deals.
There is also a carve-out excluding unions where it would be “inappropriate” of them to apply for a multi-employer deal because of repeated breaches of industrial law, largely targeted at the Construction Forestry Mining Maritime and Energy Union.
Arbitration
The bill will allow the Fair Work Commission to resolve intractable bargaining disputes through arbitration where there is no reasonable prospect of agreement being reached.
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This is a big shift away from the enterprise bargaining system of the last 30 years which requires employees and their bosses to agree, and gives employees another avenue for a pay rise that doesn’t involve walking off the job.
Burke told the House of Representatives this would “provide a strong incentive for good faith negotiations … allow for quicker resolution of intractable disputes, and significantly reduce the prospect of lengthy industrial action”.
Better off overall test
The better off overall test will be clarified so that hypothetical roster patterns will not prevent registration of pay deals and so deals are judged with “a global, rather than line-by-line” comparison with the award, as Burke explained it.
If the employer and a union agree a pay deal passes the test, the Fair Work Commission is required to give “primary consideration” to this view.
Employees or unions can seek a reassessment if circumstances change during the life of the deal.
Minimum pay and unpaid wages
The bill will make it easier to recover unpaid wages by increasing the cap on small claims from $20,000 to $100,000, allowing employees to access the Fair Work Commission rather than courts.
Job ads that advertise for workers below the minimum pay rate will be banned, but unions are concerned there is an exemption if the employer has a “reasonable excuse”.
Pay deals struck under earlier laws, the WorkChoices-era “zombie” agreements, will be cancelled after 12 months unless extended by FWC, which Burke said will ensure employers “pay minimum entitlements in awards”.
Stewart said one omission from the bill is the proposed criminalisation of wage theft.
Gender pay gap and discrimination
Gender pay equity will become an objective of the Fair Work Act, and the requirements to win an equal pay order will be relaxed.
The Fair Work Commission will gain two new specialist panels on pay equity and the care and community sector.
Pay secrecy clauses will be banned. The bill expressly prohibits sexual harassment in the Fair Work Act. It also adds breastfeeding, gender identity and intersex status as protected attributes.
Flexible Work
Employers will be legally required to try to reach agreement with eligible employees who request flexible work hours or arrangements, including proposing an alternative if the employee’s request cannot be accommodated on reasonable business grounds.
If the parties cannot agree, the employees would be able to take the refusal to the commission to reach agreement by conciliation and, where that fails, receive a binding decision.
Eligible employees are: carers, parents with children of school age or younger, people with a disability, those aged 55 or older, and those experiencing or caring for someone experiencing domestic violence.
Union regulators
The bill abolishes the Australian Building and Construction Commission and the Registered Organisations
Commission.
Job security
Burke said the bill will improve job security by “placing new limits on rolling fixed-term contracts so workers can’t be effectively put on an endless probation period”.
Labor’s broader reforms promising “same job, same pay” and extension of minimum conditions to employmentlike work arrangements will follow in a bill next year.
Reaction
Australian Chamber of Commerce and Industry chief executive, Andrew McKellar, said the bill “abandons enterprise bargaining, the key driver of productivity-based wages growth, in favour of compulsory multi-employer bargaining.”
“If enacted, this legislation would drag multiple employers to bargain against their wishes. Businesses will be forced to adopt one-size-fits-all terms and conditions, which may be unaffordable and ill-suited to the needs of their workplaces. This is not opt-in.”
The Australian Council of Trade Unions secretary, Sally McManus, welcomed the bill as “an important step forward in many areas, especially on women’s equality and respectful workplaces” but said unions are “concerned that too many workers will be shut out of the proposed new bargaining options.”
“Additionally, the Bill does not simplify or remove the red tape that makes the process of obtaining protected industrial action for workers unnecessarily long and difficult, in fact it adds more red tape.”
The Coalition has said it will oppose the bill, which the Liberal leader, Peter Dutton, described as “ticking off on the shopping list for the union movement”.
“We can’t have economy-wide strikes,” Dutton told Sky News on Sunday. “It would be crippling for businesses, particularly when we’re going into an uncertain period.”
Further amendments
Burke left the door open to amendments.
He said consultation is ongoing on: ensuring businesses on single-enterprise agreements can continue to use them; fair voting processes for multiemployer deals; preventing proposed pay deals being put to workers without union approval; ensuring a “reasonable” time for bargaining before arbitration; and ensuring multi-employer bargaining “is not extended to industries in which it is not appropriate or necessary, in particular commercial construction”.