Is it fair for a casual employee to have annual leave? What unions and business want from Scott Morrison
Innes Willox: ‘If a business does not survive, its employees are out of work’
It is time for a fresh approach to be taken on industrial relations reform; an approach that boosts productivity, grows jobs, encourages investment and restores economic growth. IR reform has an important role to play.
The unions want the reforms to deliver greater job security for employees. That is important but, of course, an employee can only achieve job security from a secure employer. If a business does not survive, its employees are out of work. Where a business is growing and profitable, the business is able to share the gains with its workforce through increased wages and conditions of employment.
The need for reform in three key areas is widely recognised.
First, Australia’s award system is far too complex. There are 121 modern industry and occupational awards, containing tens of thousands of pages of detailed requirements and more than 1,000 minimum wage rates. Australia is the only country in the world that has an award system. Given the complexity, it is not surprising that many employers have made payroll errors and underpayments.
Matters that are mainly dealt with in legislation should be removed from awards to reduce confusion for employers and employees. This approach has already been implemented for long service leave. It is ridiculous that each so-called “modern” award contains at least five pages of detailed requirements about annual leave when this topic is comprehensively addressed in the Fair Work Act. Other matters that should be removed from awards are personal/carer’s leave, redundancy pay and notice of termination, to name a few. There will need to be a few changes to the Act but this proposal has obvious merit. It should have been done years ago.
Second, Australia’s enterprise agreement system is like an old car that is spluttering along and in need of major repair. In the 1990s enterprise bargaining delivered major productivity improvements to employers and generous wage increases to employees. Winwin outcomes were common and when agreements were reached, the Australian Industrial Relations Commission (now the Fair Work Commission) approved the agreements quickly with a minimum of fuss, paperwork or technicalities. Winding the clock forward 20 years, the previous system has become a minefield of technicalities, delays and frustrations. It is little wonder that so many employers and employees have given up on enterprise bargaining.
The current unworkable Better Off Overall Test needs to be replaced with a simple global No Disadvantage Test like the one that operated very successfully for 15 years prior to the introduction of the Fair Work Act. Other changes are also needed to ensure that agreements are approved by the commission promptly without excessive technicalities.
Third, the major uncertainties caused by the recent federal court decision in the WorkPac v Rossato case need to be addressed. Casual employees make up 20% of the workforce (a level that has not increased for over 20 years). There are around 2.6 million casuals, and around 1.6 million of them work regular shifts. Forcing employers and employees who are happy with their current arrangements to undertake a major reorganisation of rosters for no reason other than to attempt to implement an unworkable approach is not sensible.
If the current risks of “double dipping” claims by casuals are not urgently addressed, hundreds of thousands of casuals will lose their jobs when the jobkeeper scheme ends in a few months’ time. The Fair Work Act needs to be amended to include a simple definition of a “casual employee”.
If an employee is engaged as a casual and is paid a casual loading, the employee should not be allowed to turn around later and claim annual leave and other entitlements that the casual loading has been paid in lieu of. That is not fair.
A more productive, flexible and fair workplace relations system can and must be achieved. The economic recovery depends upon it.
• Innes Willox is chief executive of the national employer association Ai Group
Sally McManus: ‘The impact of the economic crisis will not be shared fairly’
The government and business have worked with unions during the pandemic in a way they haven’t done for a long time, to try and save lives and as many jobs as possible.
This is not an unusual place for the Australian union movement. We are about fairness, and we have fought for and delivered minimum wages, the eight-hour day, holidays, annual leave, sick leave, parental leave, superannuation and family violence leave. Many of these gains were achieved by the union movement working with governments or nego
tiating with employers.
The response to the crisis has shown Australians the immense strength of working together. We have flattened the curve, adjusted to keep people employed, campaigned for, and won, increases in jobseeker and what many thought impossible, a wage subsidy scheme: jobkeeper.
We know the devastation unemployment causes a person, a family, a community and the nation. The economic crisis facing our country will be severe, and the impact will not be shared fairly.
The virus revealed the weakness in a system that has become too casualised and too insecure. Young people and women are already being more greatly impacted. In accepting a seat at the table to help rebuild the economy, the union movement is very clear about our objectives.
We go into discussions with open minds and we have simple benchmarks for any proposals: does it make jobs more secure? Does it mean a fairer share of the country’s wealth for working people?
Before the pandemic, the weaknesses and unfairness in our system of rights for working people were already on show.
We have an entire class of workers in Australia who have no sick leave, no annual leave and no job security. This is one in three workers, one of the highest rates in the OECD. It’s casual workers, labour hire, gig economy and fixed term contract employees.
Addressing this insecurity is a key priority.
Before the pandemic we had years of record low wage growth and declining living standards even when productivity and profits were increasing. The enterprise bargaining system was starting to fail on the basic promise to lift wages and improve our workplaces while large sections of the workforce cannot, on a practical level, access collective bargaining at all.
Working people know what we can do to fix these issues – we have been living through them and have considered solutions. We can look to examples from many countries around the world that have avoided our levels of job insecurity while lifting productivity and improving wages.
Every day unions negotiate improvements with employers – it’s what we do. The announcement by government this week brings this to a national level, without prejudice, and is a genuine attempt to find common ground. Now we will discuss these ideas with business and government.
Working people know the union movement has their back.
• Sally McManus is secretary of the Australian Council of Trade Unions