Australian Democrats' Supplementary Remarks
These remarks of
mine are deliberately characterised 'Supplementary Remarks', because on the
whole I support the majority report, but would like to make some brief additional
comments restating the Australian Democrats position on Australian Workplace
Agreements (AWAs).
Why have AWAs?
Individual
agreements (mostly common-law) are the most common agreement of all, and are
particularly prevalent in, and important to, small business. Common-law
agreements are often verbal, and not written.
As the majority
report showed, a large number of agreements are individual agreements, with
31.2 per cent of all forms of agreement-making being unregistered individual
agreements and 2.4 per cent being registered individual agreements (AWAs).
Individual
agreements are most often used by small business, generally to pay over award
payments. In larger business it is common for specialists, professionals, supervisors
and managers to be on individual agreements.
The major advantages
of unregistered individual contracts or common-law contracts are their
practicality, their ease of use and understanding, and their wide acceptability.
Their major disadvantage is when there is a breach of contract or dispute, as
they are hard and costly to enforce since that requires resort to common-law
courts. In addition there can be confusion when a relevant award or agreement
will override the terms of a contract where there is a difference in
entitlement.
One of the reasons
the Democrats support AWAs as a matter of principle is that we believe that the
statutory protections provided in individual agreements will nearly always be additional
to and therefore superior to common-law protections, which historically in
jurisprudence are built on master-servant precedents.
The Democrats
support individual agreements being statutory industrial instruments, and
oppose the notion that they should be exclusively common-law in nature.
We supported the
introduction of AWAs in the Workplace Relations Act (WRA), and among our
successful amendments were the vital protections of the global no-disadvantage
test, and the requirement that AWAs must be offered to all equivalent employees
in a workplace.
We support the view
taken by the Committee in Chapter 2: The
committee does not take issue with individual agreements per se, both statutory
and common-law, provided they are underpinned by a comprehensive award safety
net and adequate processes and resources are set aside to ensure compliance.
Statutory industrial
instruments, otherwise known as registered agreements, are of three categories:
collective industry-general awards, collective
enterprise-specific agreements, and individual agreements. Common-law
agreements are in two categories: collective enterprise-specific agreements,
and individual agreements.
The Australian
Democrats strongly believe that a mix of agreement making – collective bargaining
(union and non-union), collective awards and individual agreements – provides necessary
flexibility in a modern economy, but all agreements must be fair to both
employees and employers, and there must be an adequate safety net for employees'
wages and conditions.
The Democrats' view
is that collective agreements and awards under the existing Federal Act are
often better for workers overall than individual agreements, but we recognise
that individual agreements are a common and necessary part of working life, and
statutory provision must be made for them.
However, anecdotal
evidence that workers were being forced on to AWAs and some workers were worse
off as a result led the Democrats to initiate this Senate inquiry. It has been
over eight years since AWAs were introduced into federal industrial agreement
making and we thought it was time they were reviewed to ensure they are meeting
their stated objectives.
Our conclusion is
that improvements and greater protections need to be built into the system, as
opposed to the much reduced protections that the Government are proposing. That
does not mean we oppose more effective process in the approval of AWAS.
Are AWAs meeting their stated objective?
The Democrats
believe that the basic architecture of AWAs in the WRA is correct, that is:
they are underpinned by a global no-disadvantage test referenced to the relevant
applicable award; AWAs must be offered to all equivalent employees in a
workplace; they are available on a pattern format for small business in similar
fields; duress in offering AWAs is prohibited; and a system of checks and
approval is in place.
We accept that
modest reform to improve the approval process is warranted.
However, as the
majority report has outlined there are significant flaws in the current system,
particularly with the regulation of the system. In particular we are concerned
with:
- workers presented with 'take it or leave
it' contract;
- duress being regularly complained of
with no effective remedies available;
- evidence of pressure and coercion into
moving from collective agreements or awards to signing individual
contracts;
- failure of the OEA to diligently apply
the global no-disadvantage test;
- that the OEA is both the promoter and
regulator of AWAs.
The failure of the
system means that some employers are taking advantage of workers not in a
position to negotiate and are using AWAs to unilaterally end hard-won benefits
and conditions.
The Government are
proposing to make radical changes to the basic architecture of AWAs, which we
are extremely concerned about and do not support, specifically:
- The Government's plan to abolish the global
no disadvantage test adjudged against awards covering 20 allowable
matters, and to replace it with a new 5 minimum conditions standard; and to
- Allow agreements to come into force
before they have been approved and checked.
We are most concerned
that workers with low bargaining power such as casuals and part-timers
(particularly women), youth, unskilled, single parents, disabled, ethnic
workers, will be forced on to the new version of AWAs which will mean they will
be required to sign up to only the minimum conditions and standards.
This will lower
wages across whole industries to the detriment of living standards and the
Australian 'fair-go' tradition. It will force better employers to bring down
their wages to compete with less scrupulous employers, and will be detrimental
to the Australian economy and society.
Conclusion
We agree with the
majority report that an agreement-making system which includes individual
contracts should be underpinned by a comprehensive set of awards and provide an
arbitral role for the Australian Industrial Relations Commission to ensure that
parties to a dispute enter and conclude negotiations in a reasonable, fair and
proper manner.
We do go further
however, in that we also believe that there should be a national well-resourced
independent regulator for workplace relations. We are concerned with the
failure of the OEA – the promoter of AWAs – to properly apply the
no-disadvantage test and to police duress.
Although the
Government does plan to take away the OEA's compliance function, it intends to
hand it to the low-profile Office of Workplace Services, thus making the
Department of Employment and Workplace Relations a much-enlarged but
far-from-independent regulator at the direction of the Minister. There is the
obvious danger of partisan decisions being made.
We also agree with
the majority report that there should be a requirement of the Government's
WorkChoices Bill that employers and employees bargain in good faith.
Again we go one step
further in that we believe that genuine choice should be built into the system,
where if the majority of the employees want a collective agreement then they
can, and those who legitimately want individual agreements also can.
We are concerned
that monopolist employers such as Governments force whole classes of employees
onto AWAs where they are inappropriate. We have never understood why large
numbers of public sector workers, all doing the same work, and all in the same
enterprise, should be pushed out of collective agreements on to AWAs.
Finally we agree
with the majority report's conclusion that more time is needed to allow proper
consideration of the range of issues raised so far during the inquiry. As
mentioned, the Committee were unable to examine key witnesses and therefore to
fully explore ways to improve the system to make it genuinely fairer, while
still providing flexibility and choice.
Senator Andrew Murray
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