COALITION SENATORS' DISSENTING REPORT

COALITION SENATORS' DISSENTING REPORT

Introduction

1.1        Coalition Senators are deeply disappointed that the Government has now sidelined the bulk of remaining Fair Work Review recommendations. Instead, Labor has used the so-called ‘Second Tranche’ to grant additional rights to union bosses without any explanation, and secondly, to respond to a separate report on workplace bullying. Similar sentiments were expressed in submissions to the Committee:

...The priorities in the Fair Work Amendment Bill 2013 are overwhelmingly not those identified by the review panel. The government received 53 recommendations from its review panel and it has not seen fit to base to any large extent this major tranche of amendments on those recommendations.[1]

1.2        Coalition Senators also find the dishonesty of this Bill breathtaking. It has now been confirmed that many provisions, although announced with much fan-fare will have no actual impact whatsoever, for instance those relating to Penalty Rates.

1.3        Coalition Senators note that the provisions relating to unpaid 'no safe job leave' in this bill directly reintroduce elements of the Workplace Relations Act, despite the Labor party's derision of that Act. The re-introduction of a provision to protect all pregnant workers was confirmed by the Australian Council of Trade Unions during the public hearing in Melbourne:

It has been in the legislation. We regard this simply as an oversight. Before Work Choices and, in my understanding, during Work Choices, through the Fair Pay Commission standards, this was a right and entitlement that all employees, regardless of their length of service, had. For some reason it has dropped out.[2]

Regulatory Impact Statement

1.4        Coalition Senators were disappointed to discover that this Bill had been granted an exemption from the requirement for a Regulatory Impact Statement. When questioned, Departmental Officers could not provide any substantive reason for this exemption, as the following exchange demonstrates:

Mr Kovacic:  An exemption was granted by the Prime Minister—

Senator McKENZIE:  On what grounds?

Mr Kovacic:   In terms of the grounds—

Mr Cully:  No grounds were specified. That exception was—

Senator BACK:  Did the department make that request?

Mr Kovacic:  We will have to take that on notice...[3]

1.5        Witnesses expressed concern in relation to this exemption and an inability to understand the possible impact without such a statement. For example, Mr Daniel Mammone, Australian Chamber of Commerce and Industry, stated:

For the purposes you have just alluded to, it is very difficult to understand the impact not only on the stakeholders—the employees, the workers, the employers—but also on the regulator. I understand that the proposed avenue from the Fair Work Commission's recent Senate committee estimates is that the representatives from the Fair Work Commission indicated that at the moment they did not have the resources to implement as part of these proposed measures.

In our submission we have drawn attention in an indirect way to the number of applications under the unfair dismissal system, which appears to be tracking at just under 4,000 applications per quarter. This is a significant increase already on the resources of the Fair Work Commission. We have some concerns that it will be a system whereby applications must be dealt with in some way within a short period of 14 days.[4]

1.6        Given this Bill will affect every employer and employee in Australia, the Coalition believes that these changes would have benefited from a Regulatory Impact Statement for both the community and the Parliament to have a detailed understanding of what this Bill entails and the predicted real-world impact.

1.7        Coalition Senators strongly agree with sentiments expressed by the Master Builders Association in their submission that 'a fully formulated Regulatory Impact Statement should be prepared which objectively assesses the costs and benefits of the amendments'.[5]

Recommendation

1.8        Coalition Senators recommend that the bill not proceed without a Regulatory Impact Statement.

1.9        As an aside, Coalition Senators note that courtesy of this exemption, a further Post Implementation Review of the Fair Work Act will now need to be conducted within the next two years.[6]

Lack of clarity and rushed bill

1.10      One possible reason put forward for the exemption to prepare a Regulatory Impact Statement was because of the rushed nature of the Bill. During the Melbourne hearing the Australian Mines and Metals Association commented:

Senator BACK:  This also takes me to the point: why do you believe there has not been a regulatory impact statement presented as part of this legislation?

Mr Barklamb:  Senator, I would not want to venture an answer on behalf of the minister but I might recall an observation that we think this was done in quite a hurry...[7]

1.11      The rushed nature of the Bill could explain the concern about a distinct lack of clarity that was identified in a number of submissions to the Committee. For instance, a vast majority of submissions from employee and employer groups as well as interested parties contained a number of suggested amendments – largely related to the wording of provisions to provide greater clarity. It is disappointing that the Government did not take the time to widely consult and ensure the language contained within the Bill was sufficiently tight.

Rural

1.12      Mr Stephen Smith, Director, Australian Industry Group, advised the committee that rural industries require particular flexibility, and that the bill does not support the needs of businesses in rural and regional areas:

I think in terms of the whole legislation, when you look at all of the elements, it is not going to be a piece of legislation that supports employment, supports flexibility, and these are issues that are extremely important in regional areas. Of course, the average size of a business in regional areas tends to be smaller. They need a lot of flexibility. Businesses tend to pay closer to award rates of pay in regional and rural areas. So what is needed is legislative reform that will make things more flexible while preserving fairness. This piece of legislation, we believe, goes in completely the opposite direction.[8]

1.13      Mr Innes Willox, Australian Industry Group, advised that employers and employees tend to have much closer relationships in rural and regional areas. During the Melbourne hearing Mr Willox submitted that:

I think you could also argue that the relationship between employers and employees is much closer in regional communities as well, because of the nature of those communities. Everyone knows each other. So there has to be a bit of give and take in those sorts of communities. When you are imposing rigidities on an employee-employer relationship, that makes it a bit harder to get that give and take going.[9]

1.14      Mr Willox also observed that the agricultural and food sector industries are an 'enormous growth area', however care must be taken not to burden this growing sector with rigid industrial relations laws that will constrain growth. Mr Willox argued that the measures proposed by the bill will 'stifle' growth 'opportunities in some places at some times'.[10]

Getting the balance right

1.15      Coalition Senators are deeply apprehensive towards the dramatic expansion of rights for union bosses in this Bill. We note that Ms Gillard has taken great pride that the Fair Work Act, as enacted in 2008, got the balance right. Indeed, in Ms Gillard’s first press conference as Prime Minister she said: 'I consulted for hour after hour with business leaders, with union leaders, with small business leaders to get the balance right'.[11]

1.16      This is something that has been repeatedly repeated, including as recently as 2012 where the Prime Minister said: 'we built a modern and fair system that has got the balance right...'.[12]

1.17      While the Coalition does not agree that Ms Gillard got the balance right in the first place, using her own logic Labor has failed to explain how this Bill – particularly provisions not recommended by the Fair Work Review and in the absence of a mandate for change – will affect that balance. Coalition Senators again pose the question, where is the balance now?

1.18      Further, Coalition Senators note that this Bill will take the count to more than 400 pages of amendments to the Fair Work Act since 2009. Coalition Senators do note with some concern the Australian Industry Group’s submission at Annexure A the detailed list of the 157 new or extended union rights under the Fair Work Act.[13]

Fair Work Review

1.19      Coalition Senators again express deep concern that the vast bulk of this Bill does not deal with recommendations arising from the Fair Work Review. Given the importance of getting the balance right, the Coalition is disappointed that the government has chosen to clearly skew the Bill in favour of one side of this contested space rather than seeking the middle ground as the Prime Minister apparently sought to do. This is best evidenced by the response of employer groups when asked to provide their wish list of recommendations from the Fair Work Review. For example, the Australian Mines and Metals Association (AMMA) provided ten recommendations for reform that it believed 'should have been prioritised in any 2013 tranche of amendments to the 2009 Fair Work Act', describing these reforms as 'most urgent to enact', however these reforms 'were not prioritised by this government'.[14]  AMMA noted that the reforms listed were the most urgent within the existing 'Fair Work architecture, drawing from the recommendations of the Review Panel'.[15]

1.20      AMMA's response can be juxtaposed against the obvious delight of unions when asked the same question, again indicating that this tranche of amendments are more about keeping Labor stakeholders happy in an election year, and less about dealing with the reforms that are necessary to make our workplaces safe and productive. During the Melbourne hearing, the following exchange occurred:

Senator McKENZIE: Were there any recommendations made by the review of the Fair Work Act that you would have liked to have seen included in the bill that has already gone through and obviously this bit of legislation?

Ms Bryant: No.

Senator McKENZIE: In terms of the review that was done of the act and the 53 recommendations that came out of it, which this bill is supposedly based on, of those 53 recommendations are there any that you are particularly enamoured of and that you would have liked to have been included but have not been included in the government's response?

Ms Bryant: I am not aware of any.[16]

1.21      The evidence provided by AMMA and the Shop, Distributive and Allied Employee's Association clearly demonstrates this government's desire to appease unions by cherry picking recommendations from the review and increasing perceptions of class warfare, instead of working towards a balanced response to workplace relations.

1.22      We have previously dissented, in the Committee’s report into the Fair Work Amendment Bill 2012 that:

Despite the Review being a disappointing document on so many levels, Coalition Senators note that on certain issues the reviewers were mugged by stark realities.

The Coalition has flagged general support for the review.[17]

1.23      Coalition Senators firmly believe that two recommendations in particular made by the Fair Work Review should have been enacted as a part of this Bill.

Barclay v Bendigo TAFE

1.24      The High Court’s unanimous judgement in the Barclay v Bendigo TAFE case found that union bosses should not be an untouchable class in the workplace – something also recommended by the Review Panel. Coalition Senators welcome the High Court decision and the Fair Work Panel Review’s recommendation to this end.[18]

1.25      However, Coalition Senators found it disappointing and emblematic that Labor, through Minister Shorten, intervened in the High Court on the side of the union boss, Mr Barclay, arguing that it actually was the intention of the Fair Work Act to make union bosses untouchable even if they did the wrong thing.

1.26      Labor intervened in Barclay using more than $160,000 of taxpayers’ money to argue for the union bosses against a taxpayer funded education institution.

1.27      Indeed, in a damning judgement by High Court Justice Heydon, it has now been confirmed that Mr Shorten acted as an ex-union boss first, and Minister of the Crown second, after foolishly intervening on the side of the Australian Education Union in the Barclay v Bendigo TAFE case. Justice Heydon said:

...the Minister's stance before and during the oral hearing was not that of an intervener, but that of a partisan. For example, some of the Minister's oral submissions were directed to factual material. This is hardly the province of an intervener...[19]

1.28      Coalition Senators are disappointed that the Government did not use the first nor second tranches to enshrine this recommendation into legislation that would ensure that union bosses are treated the same as all other employees in the workplace.

JJ Richards

1.29      Then Opposition Leader Kevin Rudd pledged that the Fair Work Act would not allow the return of ‘strike first, talk later’. Yet, the decision of the Federal Court in the JJ Richards case tells a different story.

1.30      The Federal Court’s judgment accepts that the argument advanced on behalf of JJ Richards was understandable and reasonable but for the specific wording in the Fair Work Act which entitles unions to obtain protected action ballots in circumstances where most reasonable people would argue that should not be allowed.

1.31      The Government is yet to tell us whether this was simply a drafting error or that Labor deliberately misled the Australian people. Their silence is interesting and causes Coalition Senators to suspect the latter.

1.32      Coalition Senators believe that if the provisions of this case had exposed a drafting error, the Government would move with some speed to implement the stated policy that received electoral support at the 2007 election. Coalition Senators are concerned that should the Government not rectify this it will be viewed as another broken promise, in a similar vein to the Carbon Tax that Australians had to have despite promises to the contrary in 2010.

Recommendation

1.33      Coalition Senators recommend that the Fair Work Review Panel Recommendations 31 and 47 be implemented as soon as possible.

Right of Entry – Lunchroom Invasion and Joyrides

1.34      Coalition Senators have long been concerned with Ms Gillard’s broken promise, that there would be no changes to union right of entry laws. A promise made on the life of the Prime Minister’s own mother. Labor's Forward with Fairness document prior to the 2007 election contained an express commitment to retain existing right of entry provisions. The then Shadow Minister Julia Gillard directly told us:

[We] will make sure that current right of entry provisions stay. We understand that entering on the premises of an employer needs to happen in an orderly way. We will keep the right of entry provisions.[20]

1.35      Based on these promises, it was rightly expected that the existing right of entry provisions would be maintained.  However, as we know, this was simply just not the case.

1.36      Since the Fair Work Act came into effect, there has been a dramatic expansion of the laws relating to union access and we have seen an onslaught of visits. For example, it was recently reported that the Australian Workers Union made 156 site visits to BHP’s Worsely Aluminium site in 2012 and a further 175 in 2011 and the Pluto project experienced more than 200 union site visits in the first 90 days of the Act. The vast majority of these visits are either a blatant membership fishing expedition or designed to intimidate.

1.37      If the initial broken promise is not bad enough, we now have before the Parliament a Bill that would even further expand the right of entry laws.  The concerns relating to expanded provisions proposed in this Bill are twofold: the first relates to the default location, if the employer and union official cannot agree as being the lunch-room; and the second relates to the employer's liability for travel costs for union officials exercising a right of entry permit in remote locations.

1.38      Coalition Senators agree with the sentiment expressed by the Australian Industry Group at the hearing, that this measure is simply an attempt to increase union membership, and will not increase productivity:

We are always very mindful that union membership in the private sector is at 13.2 per cent. That is not to say that the unions do not have a role, they have a very clear role. Where we have a concern about right of entry is that it would be a distraction in places for some employees and employees more generally. Being allowed back into the workplace as is proposed is in many ways a throwback to the 1970s. We have moved on in terms of the relationships. We believe that this will do nothing to promote productivity. It will do nothing to promote competitiveness. We just see it as an unfortunate way to try and drive up union membership. We have concerns on a whole range of levels about how that will impact within a workplace and within the workforce more generally.[21]

1.39      Coalition Senators draw attention to the fact that these two provisions were not recommended by the Fair Work Review Panel and that there do not appear to be any public interest considerations. Seemingly, there are no justifiable reasons why these changes would be of benefit to workers, employers or to the economy – the only party that stands to benefit are union bosses.

Joy-ride scheme

1.40      Coalition Senators are concerned that employers will become responsible for the costs of transportation where access to the work-site is remote.

1.41      The Australian Metals and Mining Association pointed out in their submission that the costs of transportation to some regional and off-shore projects in the mining sector could cost in excess of $30,000 in transport alone on top of the costs of accommodation and on-site escorts.

1.42      The Australian Metals and Mining Association also pointed to the significant safety issues with many of these remote sites:

The plethora of safety issues associated with union access to remote sites includes the fact that infrequent travellers require escorting on all offshore platforms and in helicopters to ensure their safety at all times. This is a further distraction requiring extra resources to be diverted while at the same time opening up the occupier to significant risk and liability.[22]

1.43      Coalition Senators firmly believe that these sites are not tourist sites or playthings for union salespeople. They are a place for highly specialised operational workers who have undertaken weeks of intensive safety training, including underwater helicopter evacuation procedures.

Recommendation

1.44      Coalition Senators recommend that the provisions in the bill that make the employer responsible for travel expenses relating to right of entry be opposed.

1.45      The Bill contains a proposal that would make the default location for union officials to meet with employees the lunch room, in circumstances where an employer and a union cannot agree on a location. This will force the 87 per cent of Australian private sector workers who actively choose not to join a union to be constantly badgered by union bosses to sign-up for membership. Coalition Senators predict that the vast majority of union bosses will not agree to any other room. Coalition Senators believe that this change would simply send a green-light for a lunch room invasion by union bosses right around the country.

1.46      The Minister has failed to tell us why this is necessary or so pressing. Coalition Senators firmly believe that Australian workers should enjoy their lunch in peace and that this provision is a direct attack on the freedom of Australians to do so. Coalition Senators support the cameo used by BusinessSA in their submission:

Can you imagine going to your local café to have a meal and a chat with a friend only to be confronted with someone who is trying to sell you something. And your only options are to sit and listen or leave?[23]

1.47      Coalition Senators believe that reasonable entry rules for union access should apply but not just so the union bosses can run rampant. It should be seen as a privilege that requires special treatment, not something to be bargained with to threaten and disrupt workplaces.

Recommendation

1.48      Coalition Senators recommend that provisions that make the lunch-room the default meeting location relating to right of entry be opposed.

Family friendly provisions

Right to Request

1.49      This amendment simply legislates the ability for the employee, in particular circumstances, to request more flexible working arrangements from their employer. This Bill sets the bar very low for an employer to reject such a request and there is no recourse to the Fair Work Commission.

1.50      Coalition Senators view this as legislating something that already happens in most Australian workplaces where an employee could approach their employer of their own accord.

1.51      Both the Fair Work Ombudsman and the Department have confirmed at Senate Estimates that there is nothing preventing such approaches happening under the current legislative regime. Coalition Senators support observations from the Law Institute Victoria in its submission that:

The LIV has some concerns that a practical effect of the amendments may be to create an incorrect impression in the mind of the employee that employees are entitled to flexible work, rather than entitled to be considered for flexible work arrangements. The LIV considers that this may largely depend on how these amendments are communicated, as the wording of amendments themselves do not detract from the current position...[24]

1.52      Once again, this is clearly window-dressing to no actual effect. If the Government were genuine about wanting to achieve greater flexibility in the workplace for people in particular circumstances, they would accept the Fair Work Review panel’s recommendation to extend the termination period on an Individual Flexibility Agreement from 28 days to 90 days. This would benefit, for example, parents with childcare arrangements or grandparents wishing to spend less time at work.

Parental Leave and pregnancy protection

1.53      This amendment changes the current qualifying period for unpaid ‘no-safe job leave’ from 12 months after commencement of employment, to immediately upon employment. As Coalition Senators have previously noted, the Australian Council of Trade Unions have confirmed that this provision previously existed in the Workplace Relations Act 1996, including through the now passed so-called WorkChoices era.[25]

Concurrent unpaid parental leave

1.54      The Bill extends from three weeks to eight weeks the concurrent unpaid parental leave that eligible members of an employee couple can take. Also, the eight weeks will be able to be taken in separate periods (of at least two weeks, unless a shorter period is agreed) at any time within the first 12 months of the birth or adoption of a child. Concurrent leave can presently only be taken when a child is born or placed.

Rural areas

1.55      The National Farmers Federation (NFF) expressed concern that the family friendly amendments may be 'inherently unfair on agriculture employers'.[26]  In relation to the proposed obligation to consult about roster changes, the NFF submitted that the reform is:

1.55

...overly restrictive especially in relation to an agriculture workplace where the workflow is unpredictable at most times, depending on the weather and market. Farm businesses are generally family run and in our view, these amendments are unnecessary due to current flexible working arrangements being adequate. [27]

Roster changes

1.56      The bill proposes to introduce new provisions to require employers to consult with employees on roster changes. It is worth noting that while there has not been a legislated requirement, it is a longstanding common practice that employees are consulted on changes to their rostering arrangements.

1.57      Modern awards are already required to contain provisions requiring an employer to consult with employees about major changes that have significant impact on employees.

1.58      That said, Coalition Senators are concerned that a lack of clarity in the wording could lead to unintended consequences as pointed out by Mr Barklamb of the Australian Mining and Metals Association at the hearing:

Under the current drafting, no roster change would be too small to trigger the new consultation requirements, which may also act as a veto on implementing essential changes if misused. Once again no case has been made to depart from the existing approach—that is, the requirement to consult over major workplace changes, a longstanding part of our system. We foresee a confusing overlap of obligations and more red tape in the day-to-day organisation of work at the workplace level.[28]

1.59      Once again, in the absence of any detailed explanation from the Minister on why this change is so necessary and with a number of concerns expressed about the specific wording Coalition Senators recommend that this section should be reconsidered.

1.60      Business SA rejected the proposed requirement for employers to consult employees about roster changes. Mr Cairney submitted that employers are happy to consult with employees, however the proposed reforms introduces a new level of consultation that will be time consuming and have an impact on business – particularly business working in rural and regional areas. During the Melbourne hearing, Mr Cairney explained:

It is not a burden about consulting; it is the level of consultation and how long it takes. If one looks at what is being proposed, one can only read it to say that you will not be to be able to do this in a short period of time. My point about the wine industry, as an example, is that somebody who starts in the morning on day shift could be asked to work that night to ensure the grapes are picked. It is not done at the whim of the employer. Quite the contrary: it is done to meet a need of the industry. With some of these proposed amendments, one could be forgiven for thinking that employers do not talk to employees and do not consult; they do. But our reading of what is being proposed would be too burdensome. In our reading of it, it would take more than a short period of time. It could take a week or more in terms of what is being proposed.[29]

Recommendation

1.61      Coalition Senators recommend that the roster changes provision be reworded to provide more clarity.

Modern Awards Objectives

1.62      Coalition Senators were amazed at the specific wording of these provisions given the great fanfare and rhetoric from both the Prime Minister and Minister Shorten.

1.63      This amendment was not suggested by the Fair Work Review Panel. It was instead suggested by Mr Dave Oliver, the Secretary of the ACTU, in a speech on 6 February 2013 when he said: 'we’ll be asking the government to enshrine penalty rates for weekend work - in legislation, to protect it forever.'[30]

1.64      Coalition Senators do not believe that the Parliament should be in the business of legislating the details of each and every Modern Award, taking account of flexibility that may be required in particular sectors. However it is important that the Commission both in the current review and in future reviews take a common-sense approach.

1.65      These changes are summed up well by the Timber Merchants Association in their submission who say:

The proposed change to the Fair Work Act 2009 will have no practical effect. Modern awards are already required to contain provisions requiring an employer to consult with employees about major changes that have significant impact on employees.[31]

1.66      Indeed, the Department has confirmed that this amendment will have no practical effect and will not guarantee penalty rates, as has been suggested by the Minister:

Senator BACK:  That's right! I will go to the question of penalty rates. Can you explain to me in practical terms what the impact of the change proposed in this amendment bill will be? Already, I understand, the Fair Work Commission take penalty rates into account, do they not, when determining modern awards?

Mr Kovacic:  There is not an explicit obligation in terms of the modern awards objective for the Fair Work Commission to take into account the issue of whether there is a need for additional remuneration for people who are working unsociable hours, among other things. This makes it an explicit requirement. But, at the end of the day, the Fair Work Commission will retain the ability to determine whether or not the remuneration level in a modern award is appropriate, and the level that it should be based at based on the evidence that might be presented to it.

Senator BACK:  That is the case, isn't it—that, if the commission chooses to, it could decide not to have penalty rates in an award? That is the commission's function and right now. So that remains the case, even with this amendment in place, doesn't it?

Mr Kovacic:  That is correct. Indeed, there are some modern awards that operate at the moment that do not have any provisions around additional remuneration, whether it is for working weekends or night shifts, because it of the nature of work in that particular industry.[32]

1.67      Coalition Senators note the widespread concern that has been expressed by the real estate industry in relation to this provision. The real estate industry has long had differing arrangements around weekend work, noting that many house viewings and auctions take place over the weekend – something that has been supported both by employer and employee representatives before the Commission.[33]

1.68      Given these amendments will have no actual consequence and that the Commission will still be open to exercise the same level of discretion, Coalition Senators have no overwhelming issue with these provisions apart from that this kind of symbolism could have been achieved without taking up the Parliament’s time.

1.69      The National Farmers Federation also criticised the proposed addition to the Modern awards objective, observing that this amendment will entrench penalty rates – even in those industries that the Fair Work Commission has previous decided that penalty rates should not apply. The NFF observed that:

The applicability of penalty rates should be considered in the context of the industry, it should not be a blanket objective for all industries, especially when certain industries operate predominantly during overtime, unsocial hours or weekends and the specified rates have already contemplated the nature of their work hours.[34]

...

The NFF is of the view that the amendments fail to take into account the macroeconomic effect upon the economy. It is not an appropriate time to implement legislative action to entrench penalty and shift loadings into the cost of the labour market. We view the proposal as unbalanced and counterproductive to trade exposed businesses like farms, which have come under great competitive strain in recent years.[35]

Workplace Bullying

1.70      Coalition Senators take very seriously the issue of workplace bullying and noted with interest the House of Representatives Committee’s report into the issue. However, we are disappointed that the Government did not decide to deal with this issue in a separate Bill to ensure the necessary oversight.

1.71      Coalition Senators agree with statements at the last round of Senate Estimates by Safe Work Australia that workplace bullying is an occupational health and safety issue. We also note that despite the rhetoric from the Minister, when claims are finalised at the Commission, they will then be referred to state Occupational Health and Safety Regulators. That said, there is no detail as to how the Commission will interact with state regulators or how the Commission will recognise the Work Health and Safety Act or the Bullying Code of Practice that falls under it. Coalition Senators point to observations by the Law Institute of Victoria that:

...the LIV questions whether the Fair Work Commission is the most appropriate forum in which to deal with workplace bullying disputes;

How an order would be enforced in practice. It is uncertain whether the Bill vests jurisdiction in the Fair Work Commission or a Court to enforce the terms of the order...[36]

1.72      Almost every submission to the Senate Committee made substantiative comment on the bullying provisions contained within this Bill. Notably, concerns were expressed by employee and employer representatives as well as other interested parties particularly around specific wording and how these provisions will act in reality. For example, the Australian Nursing Federation (Victorian Branch) identified in their submission a number of issues where greater clarity would be of benefit, including:

1.73      The volunteer sector has identified a potential impact of these changes, as the following exchange indicates:

Senator BACK:  I do, Chairman. Thank you very much. In your submission, you made reference to the impact of the legislation on volunteers. Could you give us some further information there. For example, what might be the practical impact of this legislation as presented on a volunteer coach?

Mr Barklamb:  I thank you, Senator, for the question and for picking up on something we take seriously. There are no volunteers in our industry. We are almost exactly the opposite. We are at the highest end of the income distribution nationally. But all who appear before you are stewards of the system. We all have an interest in how our community works and that is the basis on which we have raised it. There is a statutory note to proposed section 789FC(2), which takes about the definition of a worker, including volunteers. To be honest, Senator, I do not completely know, but we make just a couple of points on this. This bill should not proceed and the committee, I do not believe, should proceed without hearing from the volunteer organisations of their concerns precisely around the coaches. I understand in the piece of legislation which is referred to, which is the Work Health and Safety Act, there is a distinction between volunteers working in volunteering organisations and in other areas, but I am not clear quite when that provides a protection and when it does not.

Senator, there is an interesting case underway in America at the moment—and I do not at all condone this conduct—but there is actually a volunteer coach of a basketball team, who I was listening to the other day, who has been withdrawn for bullying his young charges in that particular case. Obviously, a number of people have experience of those things in their past when younger et cetera. The reason we raise this is that we think it is a matter of diligence for the senators and for the committee to understand and hear from the representatives as volunteers about their concerns and what this may raise.[38]

1.74      The Government has not responded to these concerns to date.

1.75      Importantly, this Bill also fails to deal with bullying that could take place in a workplace by a union boss, despite the long history of bullying and intimidation by some union bosses particularly in the building and construction sector.

1.76      There is a very long and clear history of bullying tactics by union officials towards both workers and their employers, most recently at the Grocon Myer Emporium site which saw union officials bashing police horses. This is unacceptable behaviour and all Australians should be free to go to work free of these kinds of thuggery and intimidation.

Recommendation

1.77      Coalition Senators recommend that the definition of bullying be extended to include bullying by union officials towards both workers and employers.

1.78      Another area that the Government has, to date, failed to deal with is the additional resources that will be required to deal with these claims at the Fair Work Commission. Following the Café Vamp OHS prosecution in Victoria in 2010 the volume of claims of bullying from workers to WorkSafe Victoria rose to more than 6,000 complaints in a year – that in one state alone, one can only wonder what the implications would be on a national level.[39]

1.79      The Fair Work Commission has expressed concerns about taking on such a work-load without additional resourcing, saying at Senate Estimates that:

Senator ABETZ:  All right. Even if it was not conducted by the members of the tribunal, do you have sufficient administrative staff walking around during the day just waiting to be able to resolve bullying issues, or are they fully occupied?

Ms O'Neill:  They are fully occupied.

Senator ABETZ:  So the Fair Work Commission would be unable to deal with any extra workload howsoever arising from the bullying announcement without extra money?

Ms O'Neill:  I think that is right, Senator, but for this: I cannot comment on what capacity may or may not exist if the work was undertaken by members of the tribunal. I can certainly say that if the work was undertaken by members of staff there is not any capacity. I am just not in a position-

Senator ABETZ:  All right. Mr Ross, how many hours are spent on the golf course by your commissioners instead of sitting at the bench? Is there an extra capacity there in the bench to be able to deal with an extra workload?

Mr Ross:  It would depend on the nature of the functions, I think. But I know that we are under capacity at the moment rather than having too much capacity, and that is creating some issues.[40]

1.80      This is something that was also identified by the Community and Public Sector Union in its submission.[41]

1.81      While Coalition Senators would strongly encourage the Government to consider the deep concerns that have been expressed by interested parties such as the Law Council about the wording of these provisions including the definition of bullying, we are attracted to a proposal put forward in the Master Builders Association submission:

Master Builders submits that there would be greater utility in having complaints first referred to an agency, such as the Fair Work Ombudsman (FWO), and for that agency to be empowered to bring any application once the case was clearly determined to be legitimate. This would prevent the lodgement of an application relating to a bullying allegation being used as a device to foster “go away money” or obtain other leverage at work or, in the case of subcontractors, getting commercial leverage.[42]

1.82      Such a proposition would be consistent with the requirement under the model Work Health and Safety laws that only a government regulator can take a claim – something that was expressly supported by the former Workplace Relations Minister Julia Gillard.

1.83      Coalition Senators also see merit in having such arrangements to ensure that only meritorious claims with reasonable prospects of success proceed to the Fair Work Commission and stop any potential ‘go-away money’ from exchanging hands. The Fair Work Ombudsman is a well-placed and well respected agency that could do such work.

Recommendation

1.84      Coalition Senators recommend that workers be encouraged to take all reasonable steps to resolve their concerns, such as by making a complaint to the Fair Work Ombudsman, before elevating the complaint to the Fair Work Commission.

Compulsory Arbitration

1.85      All union submissions to this Committee make recommendations about the forced or compulsory arbitration in particular circumstances. This is something that Minister Shorten has told the media that he is considering by way of an amendment.

1.86      Coalition Senators support the comments of Mr Daniel Mammone of the Australian Chamber of Commerce and Industry at the hearing that:

In fact, the panel rejected making a recommendation, as sought by the unions in their submissions to the panel, which would create an arbitration power for the Fair Work Commission to deal with such disputes. These proposals will be strongly opposed by the business community.

The government clearly indicated in 2007 and 2008 that its fair work system would not contain new forms of compulsory arbitration. However, the act did ultimately include new forms of arbitration for low-paid bargaining and good faith bargaining in breach of these promises. On the specific proposal of arbitration for intractable disputes, the then Deputy Prime Minister and now Prime Minister, the Hon. Julia Gillard MP, on 29 April 2007 ruled this out in the following terms: 'And let me make this absolutely clear: there will be no compulsory last resort arbitration for collective agreements, as is desired by the ACTU, under Labor.' These types of proposals should be subject to a mandate in the 2013 federal election, as occurred in 2007.[43]

1.87      Coalition Senators believe in the strongest terms that any change to reintroduce compulsory arbitration would be a breach of promise on the scale of the “No Carbon Tax” or “the best thing we can do for working families is bring in a surplus”. To reiterate what I’ve said previously, such a breach would also unleash a new level of legal uncertainty about the whole Fair Work Act as a whole.

1.88      Coalition Senators note that despite the widespread submissions from to the Fair Work Review from union bosses demanding wider arbitration, the Panel concluded that 'we are not inclined to recommend providing any additional avenues for arbitration'.[44]

Recommendation

1.89      Coalition Senators recommend that no amendments to this Bill nor the Fair Work Act be made to expand arbitration.

Technical Amendments

1.90      The raft of technical amendments that this Bill makes is largely technical and grammatical. Coalition Senators note that a majority of these amendments come from oversights in the Fair Work Amendment Bill 2012.

1.91      Coalition Senators would encourage the Government to take more care when drafting and point to this as a result of what happens when legislation is rushed through the Parliament without proper oversight. We also note that this Bill was passed less than 48 hours after its introduction and the Senate Committee was significantly curtailed.

Conclusion

1.92      While Coalition Senators recognise that there are both unscrupulous employers and employees, we support the observation by the Timber Merchants Association in their submission that:

There appears to be an underlying assumption that the majority of businesses are in capable of managing employees in a manner that is beneficial to both the employee and the business. The majority of businesses operate in a fair and just manner.[45]

1.93      It is very clear that these amendments will not lead to greater jobs growth nor productivity – or for that matter, any additional protections for workers. All this Bill achieves is the ticking off of a wish-list for union bosses. Coalition Senators note that the Minister for Workplace Relations intends to introduce further amendments to the Fair Work Act in the winter sittings. Any significant government amendments should be subject to further committee consideration.

1.94      In the absence of significant amendments as recommended by this report and a Regulatory Impact Statement, the Bill should not be supported.

Recommendation

1.95      Coalition Senators recommend that the Bill be subject to significant amendment and a Regulatory Impact Statement.

 

Senator Chris Back
Deputy Chair
Senator Bridget McKenzie

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