Michael Keenan (Stirling, Liberal Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

The Fair Work Amendment (State Referrals and Other Measures) Bill 2009 seeks to build on the reforms commenced by the Howard coalition government in 2006, which took the first brave steps in seeking to create a truly national system of workplace relations. The coalition has always held the view that a national system is better than a patchwork of varying state systems. That view has not changed and to this end the coalition is supportive of the outcomes that this bill seeks to achieve. We want a national system. We started the reforms to achieve that end and we acknowledge the significant benefits that a national system can deliver to a sophisticated and modern economy such as Australia’s, particularly one in which many businesses cross over state borders. However, the way in which this bill seeks to achieve a national system is fraught with danger and has been mishandled from the start. Put simply, we like where this bill is going but we do not like how it plans to get there. I therefore indicate to the House that the coalition will oppose this bill.

Our opposition to this bill is based on two broad concerns. The first of these is that we must get the federal Fair Work laws right before we drag the states and non-incorporated bodies into the Commonwealth system. Secondly, in order to achieve a truly national system the Commonwealth must not hand control over its future direction and shape to the state governments. I want to make a few comments about these two concerns in detail but before I do I will talk briefly about the consultation with stakeholders that the government undertook, or rather failed to undertake, in relation to this bill.

The government has made much of how it consults with business, and it consulted in a commendable way when developing and introducing the Fair Work system. It utilised a number of processes to do this, including the Committee on Industrial Legislation. Strangely, in relation to this bill there has been absolutely no consultation with stakeholders whatsoever. The Senate Standing Committee on Education, Employment and Workplace Relations heard last week that the first time that people were aware of the contents of this bill was when it was introduced into parliament. This included groups such as the Australian Chamber of Commerce and Industry and the Ai Group, who were surprised that there had been no consultation in the lead-up to the introduction of this bill. This created significant difficulties, given the tight time frames that exist for consideration of the effect of this bill and that we are in the final two sitting weeks of the year.

The rationale for the complete lack of consultation in relation to this bill is unclear to the coalition. In addition, in order to understand how this bill will work in total, it has to be read in the context of the intergovernmental agreement that has been developed between the states, the territories and the Commonwealth. Yet this intergovernmental agreement only became public last Friday. Until then, stakeholders and the opposition were completely in the dark about the bill’s terms and were missing a crucial piece of the jigsaw puzzle that allowed them to understand how this bill works.

I fully endorse the observations that were made by my coalition Senate colleagues. I hope that this is not a sign of things to come in how the government will deal with future legislative developments within the national workplace relations system, as was noted in the minority committee report. We have heard a lot of rhetoric from the government about how their new system is going to work and about how it is going to transform Australian workplaces. We were subject to all sorts of platitudes and descriptors when these laws were introduced about how they were going to operate and how the system was going to benefit workers and businesses. We heard phrases about productivity and flexibility; we heard a lot about balance and about getting the system right. In short, the minister and the government promised the world with their new system. They said it was going to be simpler, they said it was going to be less complex and they said it was going to enhance productivity. They also said it was still going to retain the necessary flexibilities that a modern labour market deserves and requires.

The reality and truth of what is happening under the Fair Work changes could not be further from this spin that the government put about prior to their introduction. It is clearly only early days for the new laws, but we are starting to get an idea about the sorts of cracks that are beginning to appear within the Fair Work system. We have already seen an upward trend in strikes and workplace disputes, claims for unfair dismissal are on the rise, costs for business, in particular small business, are increasing and we are moving back to the days of a one-size-fits-all system for every enterprise and every worker across the country regardless of what industry they are involved in, regardless of how they wish to structure their workplace and regardless of requirements of that particular enterprise. We are moving back to a time when the government say that one size fits all and it should be the same in Cairns as it is in Hobart or in Western Australia.

We should not forget that Labor made many promises to Australian workers and to business about what these laws mean and how they would work. As I have said, they promised that they were going to deliver fairness, simplicity, balance and productivity, but the government have failed to make good on any of these promises. Labor’s Fair Work system does not bring fairness to the workplace. True fairness exists when everyone operates on a level playing field. Labor’s Fair Work laws prioritise the interests of certain stakeholders ahead of others. Unions, for example, have an automatic right to be involved in collective agreement making, but a business does not have an automatic right to legal representation before the industrial umpire.

Despite the assertions to the contrary, it is true that a worker can drag their employer before an industrial umpire without having any cause or genuine reason to do so, and then the employer is forced to pay money to make that claim go away. The coalition always pointed out that the go-away money was a feature of Labor’s unfair dismissal laws, and the minister promised us that the go-away money was not going to return under her new system. I have been made increasingly aware of situations where an employer is forced to pay go-away money. One such situation that has been brought to my attention affected a very small business, which, despite having complied with the fair dismissal code, still got dragged before the industrial umpire and was forced to defend its decision. Ultimately it was forced to pay money to settle the claim as it was just too expensive to defend, despite the conciliator appointed by the umpire being unable to identify problems with the process followed or the reason for that dismissal. When laws give an unfair advantage to one party over another then they can never deliver fairness to the workplace and they will always be capable of exploitation. The government’s laws put business, and in particular small business, on the back foot at the expense of genuine fairness for them.

One of the other claims that has turned out not to be true is that Labor’s Fair Work system would provide balance. We all know that the government owes the union movement a massive election debt, and it is now doing everything it can to pay off that debt. For example, developments in the application of Labor’s so-called good-faith bargaining regime have the effect of ensuring a business owner can no longer talk directly with their staff to negotiate working conditions. It is truly extraordinary that an employer could not sit down with their workforce and discuss the best way to establish working conditions within that enterprise. Businesses and their workers can no longer make an agreement at their workplace without unions being notified. If one worker on the building site is a union member, that entire workforce regardless of their view will have a union negotiate their pay and conditions on their behalf. Labor’s laws contain over 60 new rights for unions but very few new rights for workers and virtually none for businesses and employers.

Another great claim about the Fair Work system is that it would enhance productivity. We were repeatedly promised that productivity was at the heart of the Fair Work system. The government never bothered to do any homework; they never bothered to do any analysis to see how these new laws would affect productivity. They never bothered to actually assess how they were going to impact on the economy. They just claimed it in the parliament and in other forums and made repeated assertions and hoped that everybody would believe them. Even the body that is required to oversee these new laws, Fair Work Australia, has not set up a system to monitor how the laws will increase productivity. There is absolutely not one shred of evidence that these laws have done anything at all to enhance productivity in Australian workplaces.

Of course, one of the major problems with the new system has been the so-called award modernisation process that the coalition have been very critical of. Labor’s award system takes Australian workplaces back to the bad old days when the concept of one size fits all takes precedence with very rigid and complex rules. When the minister established a framework for creating modern awards on 19 March 2008 she said, ‘I can give the guarantee that no worker from this bill we have passed today into Australian law will be worse off.’ We have always agreed that we should consolidate the thousands of complex industrial awards into a simple set of national industry awards, but we have always wanted to do it in a way that made the industrial relations framework simpler. What we have seen from Labor’s botched award modernisation process is just an ongoing disaster. By taking a one-size-fits-all approach to this process and rushing it through in impossible time frames set by the minister, the Australian Industrial Relations Commission has created modern awards that go nowhere near to meeting the aims of the minister’s original request.

The minister directed the Industrial Relations Commission to make modern awards that do not disadvantage employees or increase costs to business. Clearly, the commission has been unable to meet these aims and, clearly, these are impossible aims that the minister has asked the commission to meet in the first place. The result of this process will be that wage costs will go up, people will lose their jobs, services will have to decrease and small businesses will be particularly hurt. I want to go through some examples of how this process will impact Australian workers and businesses. If you are an owner of a small retail shop in New South Wales and employ two full-time and two casual employees, you will have to pay an extra $22,000 a year to your existing staff. A newsagent in Queensland will pay 31 per cent more for just one casual staff member. The AHA in Western Australia, my home state, is predicting job losses of between 3,000 and 4,000 workers within their industry if the award goes through in its original format. Small independent country supermarkets will cut staff numbers, reduce trading hours, or simply be eaten up by the larger players. Even the Baking Manufacturers Industry Association of Australia said that this legislation will cause the price of bread to increase. Worryingly and most disconcertingly about this botched award modernisation process is that most of the jobs that will be lost will be those of part-time working mums, casual students and female workers.

When the coalition sensibly tried to amend the legislation so that the terms of the minister’s original request would enshrine in law that nobody would be worse off through this process, businesses would not face increased costs and workers would not lose any of their entitlements, the Labor Party voted against us. Subsequent to that, the minister refused to guarantee workers that no job would be lost as a result of her bungled process. I will give an example of how the spectre of the forthcoming modern awards process has been received in the real-life business sector. Only last week, I was invited to attend a meeting of hairdressers and beauticians in Western Australia who are concerned about the terms of the so-called new modern award that will apply to them in six weeks time, on 1 January 2010. They had arranged a meeting of concerned small business owners and had asked me to attend the meeting to listen to their concerns. This is an industry comprising people who are genuine operators of small businesses. They are often owner-operators, they are a very diverse business sector and they do not have a strong industry body speaking up for them, as some other sectors do.

These people run hairdressing salons and beauty treatment centres. Every Australian uses them. We all get our hair cut. We all have an association with these small businesses. We know the sorts of pressures they are under. These people represent everything that is good about small business: they work hard and they put in their own personal assets to start their business. They put their own assets on the line so that they can make a contribution and hopefully go on to employ more people, create jobs and grow their business. With a bit of luck they will turn a small business into a medium-sized business or into a larger business. These are the people who take on apprentices, who provide career paths and, of course, who support their local communities. We should not underestimate their contribution. They show the best of the Australian spirit—that entrepreneurial spirit to go out there and have a go.

At the meeting there were well over 150 small business owners from the hair and beauty sector. I thought that was an incredibly large number for a sector that clearly does not have the organisation that is associated with some of the larger sectors. If you need any further evidence about the concerns of small business then look no further than the modern award that is going to be imposed on them. These people took the time to come to this meeting, to speak amongst themselves and to speak to me so that I could hear about their worries and about what they see as the impending disaster of the modern award that is being imposed on them. They told me that, if the award goes ahead, they will not be able to take on new staff. They told me that, instead of taking on two apprentices next year, they might be able to afford to take on one. They told me that they will have to cut back on the hours that their business opens. Some said that they were already sailing so close to the wind and that their business environment was already so difficult that they will just close their doors if this award goes ahead. As people who own their business, who are prepared to invest their assets and have a go, who often work weekends—in fact, most people in these types of businesses work weekends—who employ people and who do all the right things, they expressed dismay that their government would make it so much harder for them to keep their doors open, grow their businesses and employ other Australians.

I am sure that, if the minister had been at this meeting, she would have tried to reassure these people. She would have talked about a five-year phase-in period to increase wages—and I am sure that we will hear that sort of rhetoric when the minister responds at the closure of this debate. But the truth of the matter is that, as the hairdressers and the beauticians explained to me, it does not really matter what it costs them tomorrow, next year or in five years time, this award modernisation will still come at a significant cost to their businesses. It is still a cost that they will have to cover—an additional cost which comes directly and solely from the minister’s own bungled approach to modern awards. This additional cost will come most grievously at the expense of jobs—jobs for young people, jobs for school leavers, jobs for mums who want to return to the workforce, jobs for people who work casually and jobs for people, such as students, who work on weekends. This is the reality of Labor’s modern awards program all around the country. This story has been repeated to me not just in Western Australia but all over the country, as I have moved around and talked to people in different sectors. About half of the hairdressers whom I spoke to recently were unincorporated businesses. They are mum and dad operators, sole traders—people who currently sit outside the scope of the national industrial relations system by virtue of being unincorporated. They are exactly the type of small business that will be roped into the government’s Fair Work laws and related system of bungled modern awards if this bill goes through.

With all of this said, it begs the question: why would the opposition, the party of small business, the party that always defends the interests of small business in this House, support a bill that exposes thousands of these small businesses to the sort of system that is going to challenge their livelihoods? We are not going to subject small workplaces in many important sectors of the economy, such as horticulture—as I know you are very well aware, Mr Deputy Speaker Schultz—to the bungled and botched outcomes that have been delivered by Julia Gillard through this award modernisation process. We are not prepared to throw these small businesses to the mercy of this new national system that just is not working properly and just is not fulfilling the promises about how it was going to operate that were made by the government when it was introduced.

We continue to want a national system, but we need to make sure that we get the national system right before we start roping in the states and exposing these small businesses to the failings of Fair Work. We need to get the system right. We need to get the modern award system right. We need the Fair Work system to deliver outcomes that are consistent with the sorts of goals that the government said it was trying to achieve. This bill will destroy jobs if it goes through and it will retard job growth in Australia. We need to get our national house in order and fix the cracks that are associated with Fair Work, and then we should talk about creating a national system and roping in these unincorporated bodies.

Our second concern relates to the extent to which this bill delivers control over the federal system into the hands of state governments. We believe that this approach is very dangerous. No doubt the minister will make noises about the benefits of cooperative federalism and how this bill and the intergovernmental agreement are an example of this in action. But again—as we always see with this minister—the rhetoric is very different from the reality. The reality is that a state government can opt out of the federal system if it does not like any future amendment to the Fair Work laws. Despite this fact being hidden behind the development of so-called ‘fundamental workplace relations principles’, these principles are so vast and so broad as to be interpreted to mean that any referring state government can pull out of the system at a whim—and I might say that these were the concerns that the business community brought to the Senate committee when it had its inquiry into this bill. A state government does not even need to be reasonably satisfied that a future change will offend these principles; it has complete discretion to withdraw from the system if it believes that these fundamental workplace relations principles have somehow been breached. This means that a state that terminates its reference will still remain within the ambit of the Commonwealth system, but it will just not be subject to the particular amendment that it finds offensive. So the Commonwealth would still have to pick up the tab for the system, and it means that the states can pick and choose what they like and what they do not like about any future national changes. They will still get the protection of the Commonwealth funding, and they can still have a say about the future of the national system, but they do not have to accept its consequences.

In reality, this means that state references become a political tool to be dragged out and used inappropriately, by way of threats, and it means that industrial relations will continue to be an issue at every state and federal election from this point on. It might be different if a referring state that withdrew was actually forced to take responsibility for the cost and administration of its own system, but, sadly, this bill does not provide for that. It will not do that under the arrangements that are detailed in this bill. Hence, these provisions are nothing more than the creation of a political tool where Australian workplaces become a football to be kicked around every time an election is called.

This is not good enough. It is not good policy. It is not the way forward for a national system. States that want to leave the national system, as is their right—if they want to take that decision—need to take responsibility for that decision by taking responsibility for their state system. I take this opportunity to foreshadow that in the Senate my colleagues will be moving some amendments to this bill to that effect. The effect of those amendments will be to ensure that, if a state does seek to opt out of the federal system, it can, as is its right, but it will need to assume responsibility for administering and funding that system. States will have to show courage, and this will stop state references becoming the political football that they will become under this bill as it is proposed.

We will be opposing this bill. Before it can gain our support—we do support the structure of a national system but we support the right national system; we do not just support any national system, and we do not support a national system that is going to disadvantage the Australian small business community—the government needs to get its house in order. This minister must stop dismissing valid concerns of stakeholders, particularly about the award modernisation process, and we must return to some rational and sane public policy.

We want a national system that provides consistency. Indeed, we started the process towards a national system. But we will not have a system where an individual state would have the power to continue to remain within the Commonwealth laws while riding roughshod over any future changes within those laws. We do not want thousands of small businesses, the backbone of the Australian economy, the hardworking mums and dads in the industries that I have outlined, such as the beauty and hairdressing industries, subject to this botched and mangled award modernisation process. We require a national system that actually gets it right, and it is simply too soon for the remaining states to be dragged on board.

A national system is a very important public policy goal, but we will only support the right national system and we will not support a national system where, as always with this minister when she is faced with two choices, the high road of policy or the low road of politics, her response is always the same: the low road of politics. Australian public policy is worse for that as she bungles all the major areas within her responsibility. We oppose this bill.

Shayne Neumann (Blair, Australian Labor Party) Share this | Link to this | Hansard source

I rise to speak in support of the Fair Work Amendment (State Referrals and Other Measures) Bill 2009. I say to the shadow minister: you had a national system that you aspired to, that you voted for, that you campaigned upon and that you still support, and that is named Work Choices. That is exactly the policy that we hear espoused by those opposite. It is the policy that the shadow minister simply will not mention, but that is the policy he believes in. The authors and the architects of Work Choices are there, still believing. It is still an article of faith, and it oozes out of every word, every dot, every cross and every full stop. It comes through what he has to say. That is what it is all about. It is about Work Choices. It is about opposing our policy. He cannot bear to say it but we know he believes it. That is what it is there for. It is ‘Work Choices light’. That is the national approach that he would have us adopt and that is what he did not say, but he believes it in his heart of hearts and all those opposite still believe it. That is the policy that they brought. That is their national approach.

We were elected to kill off Work Choices and we have done so. We are bringing in a fair, balanced and sensible industrial relations system and a national approach—Forward with Fairness. We said we would do this, unlike the previous Howard government who did not campaign on that policy of Work Choices and who subsequently brought it in. We said to the Australian people, ‘If you elect us we will do this.’ We said it as early as April 2007 when we released our Forward with Fairness policy and we released our transition implementation plan in August 2007 before the election, which was held on 24 November 2007. We were voted in by the Australian public on that platform. The transition to the Forward with Fairness bill was passed on 19 March 2008 with a down payment. It was a down payment on what we said to the Australian public—preventing Australian workplace agreements, bringing in a new no disadvantage test for future agreements and providing for award modernisation by the Australian Industrial Relations Commission. The Deputy Prime Minister originally requested that on 28 March 2008.

After much antagonism, angst and aggression from the opposition, we managed to get amended legislation through this House and through the Senate, but still with the integrity of what we said to the Australian public, for a commencement of the fair work system on 1 July this year, Fair Work Australia—a new organisation, a new enterprise bargaining system, a fair go for workers, a fair go for all, new industrial action rules, a new national approach and an approach that we were elected upon to deliver to the Australian public for the benefit of the national interest. It was also to benefit workers and employers, releasing employers from the complexity, the onerous provisions and the obstruction of Work Choices. What we are doing here is bringing in one national law for all. We want good faith bargaining at the enterprise level. We always supported it. Unlike the shadow minister, I have always advocated that Labor is the party of small business. Labor is the party to support small business.

We, not those opposite, brought in the Trade Practices Act to give small business a chance. Look at what we have done to help small business throughout Australia. In my electorate we brought in a tax break as part of our nation building and jobs strategy to support jobs. We have given assistance, and online assistance, to small business. One after another there are examples of where Labor has helped small business. The Rudd Labor government is lifting up, giving a hand, helping those in need, investing when those opposite would oppose it and increasing productivity. This is all being done with fairness at the workplace and is giving employers the opportunity to earn profits and also giving their employees the benefit of higher wages. That is what a fair industrial relations system is all about. That is the way you deal with employees in the workplace—negotiate at the enterprise level. We needed a new industrial umpire to oversee the system and Fair Work Australia is it. We needed a new education and enforcement body—the Fair Work Ombudsman.

The legislation here is all about taking another step, another stage, in creating a more simple, balanced and modern workplace relations system, and we are doing it in cooperation with the states. The Howard government’s idea was to override the states. They criticise us for being centralist. Mr Howard, the former Prime Minister, was one of the greatest centralists you have seen. We are working cooperatively with the state governments, Labor and Liberal—even the Western Australian government—on so many issues. The state referral stage is next, and that is what the legislation before the House is about. It is about bringing in the basis for a national system and allowing referrals by states to the national system.

We have some strange laws with respect to federalism in this country. For example, if you are running a business—say, a legal practice—be it as a sole trader or under a partnership arrangement, you are part of the state system in terms of your employees; you are not part of a federal system. But, if you decide to incorporate a legal practice—you are a constitutional corporation—you are part of a federal system. If you are a farmer, say, in the Lockyer Valley or the Fassifern Valley in an unincorporated family trust arrangement or in a partnership between the husband and wife, you are part of a state system in terms of your employees. If you decide to incorporate and you establish a corporate trustee over a family trust arrangement—a corporate trust that employs staff—then you are part of a company structure and you are subject to different laws and awards. It is a crazy system. It results in strange outcomes. It results in confusion and complexity and in people just putting their hands up in despair at the system.

What we need in this country is a uniform national workplace relations system. We need for the first time the same law whether you live in the Torres Strait, Tasmania, Palm Beach or Perth. We need the same law for all. We need minimum conditions, rights and entitlements regardless of state boundaries. The dingo fence should be gone. We should have the same law regardless of whether you live in New South Wales or Queensland or whether you are a corporation, a sole trader or trading as a partnership. That is what we need and that is what this legislation is all about. Victoria participated earlier this year in remaking its referral. We have seen Tasmania, South Australia and Queensland undertake this process as well.

I do not share the shadow minister’s concern about trusting the states with respect to this. States under this legislation can choose the extent to which they refer matters and can withdraw from the system. What would the shadow minister have us do? Would he decide to ride roughshod over the states in this regard? I do not think that is the way to go. I do not think that is what our forefathers, when they created the Federation of Australia, would have had us do. These are complex jurisdictional issues and I think we need to act in a constructive and consultative way to decide these issues. Regrettably, the Western Australian government have decided not to refer their industrial relations powers. Western Australia have done that in so many other areas, and I would urge them to reconsider their position. The coalition has been critical, but it has always been with the idea at the back of its mind that Work Choices may come back. That is what it is all about, and you can see that. I think the spirit of cooperative federalism is crucial, and it is obvious in the intergovernmental agreements we have achieved between the states.

There is provision in the agreements for employees to transition. We are talking about a 12-month transition from referral commencement. In that time we are going to see Fair Work Australia required to consider whether a modern award should be varied with respect to the incoming state employees and employers. We have been consultative with respect to various sectors. I know the shadow minister was very critical of us, but I can give you a couple of illustrations of local people who have contacted me and made representations with respect to these types of matters. We have listened and we have consulted. The Deputy Prime Minister wrote on 26 August 2009 to the President of the Australian Industrial Relations Commission in relation to the award modernisation request concerning horticulture, retail, pharmacy and call centre industries.

A number of people in my electorate have contacted me about these types of issues. For example, Tony Gibb, of Gibb Brothers at Peak Crossing, contacted me. They are a very large farming enterprise in the south of Ipswich, in the north part of the Scenic Rim Regional Council area. They employ about 90 people, nearly all locals, and are one of the biggest cauliflower producers in Queensland. Tony was concerned about the issue and approached me, and we had a discussion. I was pleased that the Minister for Agriculture, Fisheries and Forestry went to his farm and discussed issues raised by him and other producers such as the directors and managers of Kalfresh, who are based in the Kalbar area in the Fassifern Valley. They came and talked about the challenges of people who run farms in that area. They are one of the biggest producers of carrots in Queensland. There is a saying that cauliflowers and carrots need to be harvested on a Sunday, so they were concerned about what we were going to do with respect to the modern award system. The minister listened to representations by people like the Gibb Brothers, Kalfresh and so many other farming groups around the country. That is really important in my view and it is certainly important to the agricultural sector in my electorate, which is a very large rural and regional electorate in South-East Queensland. Allowing flexibility with respect to seasonal demands and restrictions caused by weather was another issue. Making changes to provisions that take into consideration the perishable nature of produce is really important. I commend the Deputy Prime Minister for what she has done in that regard.

I also commend her for what she has done in relation to the retail sector. A number of people in the retail sector in Ipswich approached me concerning what we were going to do with award modernisation. Jim McKee, who runs a fantastic little cafe in Ipswich called the Cactus Espresso Bar, consulted me about these issues. I wrote on his behalf to raise the issues that he raised with me concerning award modernisation, particularly penalty rates, and the concern that he would have to lose staff as a result of the changes we were going to make. But the Deputy Prime Minister listened to the voices of people like Jim McKee and many others in the sector to make the variation more amenable. She wrote to the Australian Industrial Relations Commission on taking a more benign approach and having a more flexible arrangement to meet the needs of those employers in those sectors. I commend her for what she has done in that regard.

I am amazed and mystified that the shadow minister has expressed the view that this legislation should be opposed. It is always going to be a challenging task to modernise awards. We have over 4,000 instruments and we are trying to reduce those to fewer than 125 modern awards, so there will always be challenges. It will always be difficult to effect that change. But business is asking for this. Business is asking for certainty. Anyone who has been in business knows the challenges of running a business and how the federal industrial relations system that we have makes it more difficult. I was in business and a senior partner of a law firm for about 20 years, and I know how hard it is to run a business. As the shadow minister said, you take risks every day of your life. Your assets are on the line. I commend all of those nearly two million small business proprietors in this country, who take risks every day. They do show entrepreneurship. They do show the Australian commitment to a fair go. They are the kind of people who are the backbone of our economy. Four million people work in small business in this country, and they are to be commended. We want to make sure those businesses have flexible workplace relations and fair systems and that they deal with their employees in a cooperative and constructive way. That is what Labor is about. It is not about going back to class warfare. It is not about going back to systems that might have existed decades and decades ago. It is about ensuring that we get productive workplaces where profits rise, where employees’ wages rise and where everyone gets a fair go.

I say this: the coalition have always shirked when it comes to reform. Their idea is to bring in, say, a GST. Their idea is to bring in Work Choices. They shirk when it comes to the hard decisions. It was the Hawke and Keating governments that floated the dollar and brought in superannuation. We deregulated the banking system. We took the step of bringing in enterprise bargaining during the Hawke and Keating era. We are the party that support small business. That is demonstrated by our Nation Building and Jobs Plan. That is demonstrated by this legislation. We want to make sure we have modern awards and a system that cuts red tape, allows businesses to lift productivity and makes Australian workplaces places of a fair go. That is what this legislation is about. It is about working cooperatively with everyone.

I want to finish by quoting a good friend of mine, the Attorney-General of Queensland, the Hon. Cameron Dick, who was a very fine lawyer when he was practising at the bar. In stating that the Queensland government had taken steps to refer powers to the federal government, he said this in a second reading speech that he made on a piece of legislation in the Queensland parliament on 27 October 2009:

The Queensland government has not taken this step lightly and not without extensive consultation with Queensland employers and unions.

He went on to say:

… a national system can achieve comparable results, and that is why Queensland has taken the step to refer State’s power on this issue.

He went on to describe it, saying it:

… is a giant step forward in establishing a cooperative system that respects State rights, but also creates an overarching national industrial relations system which is in the best interests of business and workers.

I say amen to that. Cameron Dick, who is also the Minister for Industrial Relations, is absolutely correct. This legislation is good legislation. While it enhances the productivity and the profitability of business, it also creates a fair go in the workplace. It is another step along the road to a fair industrial relations system, a national industrial relations system and a productive industrial relations system. I commend the legislation to the House.

Wilson Tuckey (O'Connor, Liberal Party) Share this | Link to this | Hansard source

The first paragraph of the explanatory memorandum to the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 advises us:

The Fair Work Amendment (State Referrals and Other Measures) Bill 2009 … amends the Fair Work Act 2009 … to enable States to refer workplace relations matters to the Commonwealth for the purposes of paragraph 51(xxxvii) of the Constitution.

On the face of that bald statement you could say that is making progress. But of course with these issues the devil is in the detail. The Howard government went to a lot of trouble to give people the opportunity, when doing business in one state or across state borders, to participate in a deregulated labour market that had a safety net. At one stage it probably went a bridge too far in terms of not having the usual no-disadvantage test, and I want to come back to that in a minute, but, in recognition that that was going too far, it amended the legislation so that that particular proposal was included. In shifting to the provisions of the legislation, which was national in terms of people under the corporations power having a workable arrangement, people could negotiate directly with their employees and of course they could make concessions that frequently suited the employees in terms of hours of work. I want to make some special points about that later.

That was a national scheme provided you conducted your business or the employment of your staff under some form of corporate structure, otherwise the states retained their opportunity to maintain awards and they applied principally to small business. Most of them would not have national implications anyway. The present government campaigned in opposition and made this the centrepiece of their campaign for election. They had their union mates run, amongst others, some pretty despicable ads. I find it amazing that we members of parliament are now having our correspondence censored to the point where I, as a member of parliament, can no longer transmit the views of one of my constituents who is complaining about some aspect of the Rudd government’s performance that might be affecting them personally. I am not allowed to use a postage stamp paid for from government revenue to forward that information, even to a minister. That ain’t fair—and of course we have just had the member for Blair wanting to talk up a ‘fair’ industrial relations approach. I might say that members of parliament, the one group in Australia that has no workers compensation and of course no union to represent them, have learnt long ago that the no-disadvantage test is ignored completely in terms of how we are dealt with by the government of the day, and I make a generic comment in that regard. That is notwithstanding that if I were on the other side of the House there would be some awful trouble in the caucus when my leader, as it would be, took away my right to communicate with my constituents, as would happen were I a member of the Labor Party—even worse! But that is getting a little bit away from it, notwithstanding that it is a union issue.

What I am saying is that when that campaign was conducted there were a couple of ads that I thought were well below the belt. The point that I want to make is that there are now campaigns around the place saying you should not give donations to political parties, which is a good idea. But I did not think it was a good idea when I picked up one of our Western Australian newspapers the other day to find three full-page ads in it, one from a trade union sticking it up the Premier of Western Australia over some negotiation he was having on behalf of the taxpayers of Western Australia in terms of a wage settlement for a particular group of workers, another one from some environmental group and I cannot remember what the third one was. But how do you prevent that happening? It just depends who your mates are.

If, as you do with this sort of legislation, you entrench the trade union movement as a body that is allowed to collect money from people who do not necessarily want their services, they will have the revenue to promote a political party over another, even if they have stopped making donations. So, if this debate is to go forward, someone had better start talking about a blanket ban on advertising from the date that the election is called, otherwise it will be grossly unfair.

I want to refer to those advertisements. One that I well remember blackguarded the small-business community, which I was involved in. Had I suggested that a woman with two children was to come back to work and leave those two little kids in the house, my wife would have shot me. That would be the situation in most family businesses. I thought, maybe a little belatedly, that when that ad was run with a woman and two kids and the phone rang—‘Come to work or take the sack’—the business community ought to have run a parody of that ad and employed the same actress. At the point of that phone call she should have said: ‘Thank you, Mr Smith. Stick your job,’ as impolitely as she could, ‘because under Work Choices I get two job offers a week. I’ll be ringing one of those people next week. I can get another job.’ I want you to draw your attention to the circumstances that exist today. If she got that phone call, she would probably go to work because she does not know, under the Rudd government, where the next job is.

This is another point. This legislation is opposed because it extends the influence of trade unions; it does not protect the workers. To get access to many workplaces and avoid harassment or, as a private business, to take your hire equipment onto a building site, why do you have to make a financial contribution to a trade union? They would say, ‘We’re the people who tell you what your award rights are.’ We have moved on a bit. The average 10-year-old kid can find that out on internet, and a lot quicker than I could. When the world changes, why does this House keep passing legislation which treats people as though they are a mob of kids who were put in the mines when they were 13 years old and when the role of the trade unions was so important to those people? Why are we still legislating trade union rights over the rights of workers?

As I said, the member for Blair referred to a fair industrial relations system. I thought—and I made this comment once before and the member for Sydney tried to misrepresent what I said—‘What is fair about telling a university student that they’re priced out of the market because people are pulling back on the number of employees they have in the evenings to serve in a restaurant or something—shrinking their workforce—because they’re paying ever-increasing penalty rates to people who might be working their first hour for the week?’ Why is it fair to say to a married woman or a married man, people in a partnership with a couple of children: ‘Look, I understand that you want work on weekends because you have a sharing responsibility for your children. But, of course, you can’t work at my place because I’ve got to pay you time-and-a-half for the first hour worked on Saturday. I lock the door on Friday night—in fact, mid Friday afternoon—and send everybody home.’ There are people who want to start work at that point in time, but for the first hour of the week the gate is locked.

I noticed Wesfarmers, the owners of Coles and Bunnings, in the states bar Western Australia providing a seven-days-a-week service to people who, amongst other things, need to buy their groceries on a Sunday. What was their chief executive, Mr Goyder, saying to shareholders the other day? ‘There’s a big problem under Julia Gillard’s law. Our costs are going to have to go up and our prices will go up with it.’ Anybody who thinks there is altruism within the business community—that they will pay time-and-a-half and not build it into their cost structure and put a profit on it—is living with the fairies. Under an AWA, it might be your choice to work on a weekend. It might be that you, as a young person, prefer going to the beach on a Wednesday, when you can get your surfboard out on the waves and not be run into by the other hundred who are trying to do the same thing or you can spread out on the beach, and you are prepared to work on Saturday as an alternative. What is fair about telling someone they cannot do that because 80 or 90 per cent of the work opportunity ceases on Friday night and does not recommence until Monday morning?

That is what this legislation is about: speaking to the state governments, and to those of the Labor intent to a degree. I am not sure about New South Wales. Western Australia—the resource state, the state that is just about keeping the entire population of New South Wales in a job as it recycles our money, and we can say much the same for Victoria—knows that it is not in the business of shuffling money around in circles. It is in the business of producing primary product—not only minerals. In my electorate wheat is a very costly business—in fact, so costly that farmers bet their farm once a year when they put in a crop. The cost of putting in a crop roughly equals the value of their farm—if not in one year, in two. Two years of bad seasons and you have lost your farm.

They know that, if they cannot operate over a seven-day week, they are not competitive in the international environment. Nobody rings them up from China, Indonesia, India or the Middle East and says, ‘We understand since Julia Gillard, the minister, brought in the legislation that you are doing it tough and you have to pay extra wages, so just put the price of iron ore up a bit.’ The Chinese are going berserk at the moment when the market drives the price of iron ore up. Why is this not something that the Western Australian government should participate in? It will not do it to the extent that it possibly can, and that means that the hundreds of subcontractors that go onto these mining sites and others who work as individual spraying contractors, mulesing contractors and shearing contractors that drive their own trucks and who are not incorporated can have a business that has a wage structure that reflects the needs and the competitive circumstances of those businesses.

The unions got marching in the street the other day in Western Australia. Why? The Western Australian government, under Richard Court, led the situation of legal contracts with individual workers. I think they have mentioned that they would like to do it again. I do not think there is any legislation in the offing. Why should they be roped into a system that was in decline during the Hawke and Keating years? They were the first people to start to tackle it. I often remind this place that even Gough Whitlam made his contribution. He could not legislate to fix up a corrupt and decadent system which was an anachronism of the days of 10-year-olds in the coalmines. What did he do? He lowered the tariff regime by 25 per cent and revalued, as governments did in those days, the currency by 25 per cent. In other words, he changed the competitive circumstances of manufacturers in Australia by 50 per cent in terms of their costs.

That started the process of some common sense in the labour market where, in my living memory, wages were automatically increased by the consumer price index. So you put wages up, which put the consumer price index up, which put wages up—and you wondered why we were going through all those sorts of silly ideas. But I well remember, when things were a little hotter in the labour market than they are now, a milk bar proprietor complaining to me. He thought it was a bit tough to be paying $17 an hour to young people through an AWA. The award at the time, if it was still in existence, was about $5 or $10 an hour. It was probably $10 in this day and age. What are we doing here? The member for Blair had to tell us how many times they have had to go and rewrite one of these new awards. First, they had to do it for the restaurants and then they had to do it for the horticulturalists. It is a mess, but it is typical.

I read in today’s paper that they have had to find another billion dollars for putting in pink batts. For a billion dollars, talking about a debate that is now on in the Senate, you can put out a high-voltage DC line to connect the gas resources of the Pilbara with Western Australia and reduce emissions in that process by about 300,000 tonnes. Where should you be spending the money, more particularly when it is now patently obvious that this system is being rorted and rorted again? I heard of one case where a fella climbed up in his ceiling to see what had happened and in fact the so-called pink batts were newspapers stuffed into plastic bags. There was another who had two jobs, one being half the size of the other, and the contractor gave him a bill for each of them for $1,600. The fellow said, ‘Hang on a minute, one job is only half the size.’ He said, ‘Why should you worry? The government is paying the money.’ Now there is another billion dollars that has got to be found. The Julia Gillard memorial halls business only ran $1.4 billion short, and the computers in schools program ran $2 billion short, but it was all money to be extracted from the taxpayer by the state governments. When is this government going to get anything right? And when should the opposition concur with legislation of this nature which has got very little to do with the welfare of workers but a lot to do with the extension of the power of the trade union movement?

In considering this legislation which we are amending, I picked up the paper the other day and read that those poor old maritime workers who are servicing the drilling rigs are on $100,000 a year for working half the year—six weeks on and six weeks off. I used to fly first class with them when they had control of the coastal shipping and they would be telling me how as soon as they got home they were going to get out on their cray boat. They were not going to take a rest. The point of it is that these blokes say $100,000 is not enough and they are going to do their best to put our export industries in natural gas and other areas at a disadvantage and in danger by asking for more. They are the same people campaigning and trying to take over coastal shipping again so that people have to pay more for the products that come in by container and all those things. The member for Blair said that we never did anything. We took the container lift rate up to double after the wharfies had voted to reduce their workforce by half. Was that good for Australia? I would think it was. Did it reduce the price of flat screen televisions or all the other things people buy in the stores? Of course it did. (Time expired)

Craig Thomson (Dobell, Australian Labor Party) Share this | Link to this | Hansard source

You do not have to scratch the opposition very hard to find Work Choices coming bleeding out of every pore of their bodies. We have had so far two contributions and both have been lamenting the fact that Work Choices is dead. The member for Stirling, the shadow minister in relation to this area, has said that they are opposing the bill for two reasons: firstly, they do not like the way we got to where we got to with this bill in terms of having a national industrial relations system—and I will say something about that later; and, secondly, because they do not like Fair Work Australia. His justification for not liking Fair Work Australia was the lament of Work Choices: ‘Look, we don’t like the system because you’ve now got unfair dismissals and the costs this is going to bring.’ Opposition, wake up! We had an election two years ago. The Australian people spoke on this issue directly. They had the choice. They had your Work Choices or the Labor Party’s policy of Forward with Fairness. They spoke and they spoke decisively. It is time to get over it. You lost the election. Move on. Let us get on with the job of making a fair industrial relations system—a national industrial relations system that is fair for all Australians.

I listened to both the member for Stirling and the member for O’Connor and the particular reasons they are going to oppose this in relation to their pining for Work Choices. There were three things they mentioned. There was unfair dismissal. The member for O’Connor made it clear that he doesn’t like penalty rates—that if the opposition had their way in relation to industrial relations, there would not be penalty rates. That was another issue. So, workers beware out there. Penalty rates are still under threat from the opposition. They do not want to have unfair dismissals.

What a great time to the member for Mayo to enter the chamber. One of the architects of Work Choices is coming in perfectly on cue. I have been very fortunate that this is the second time that I have been speaking on industrial relations issues and the member for Mayo happens to come into the chamber to follow after me. It is a great privilege to have him following after me, but it is also terrific to remind the Australian population of the member for Mayo’s particular views on this. I am going to listen with great interest, because I am sure he is going to add a few more gems to the lament of Work Choices.

At this stage, before the member for Mayo even gets a chance to get to his feet, this is what the opposition are saying: ‘We want to do away with unfair dismissals. That is why we don’t like this bill.’ ‘We want to get rid of penalty rates,’ the member for O’Connor has told us. The member for O’Connor also told us that, if the opposition had their way, they would bring back AWAs. These are the three key issues that we fought the last election on. The resounding decision of the Australian population was that they rejected that view. They rejected the view of the member for Mayo; they rejected all the work he had done on the Howard legislation to put forward Work Choices. They said: ‘We don’t want that unfair system. We want a system that is fairer. We want the Labor Party’s position in relation to Forward with Fairness.’

One of the first pieces of legislation we put forward into this parliament was our efforts to abolish AWAs. Every time we have anything to do with industrial relations in this place we get members of the opposition lamenting that particular decision. But the Australian population wanted us to do that and we delivered in relation to that. This government is about creating a fairer, simpler, balanced and modern workplace relations system—a system that takes into account the views of both employers and employees; one that is simpler and meets the modern requirements of this economy.

We started to achieve this with the commencement of the Fair Work Act 2009 on 1 July this year. We now mark the next stage in implementing our plan, which is the legislation before us today: the Fair Work Amendment (State Referrals and Other Measures) Bill 2009. I am going to outline some of the key features of the bill, but first it is important to recall the stages of the government’s workplace relations reforms that have been implemented so far, despite the ongoing opposition from those on the opposition benches.

The Workplace Relations Amendment (Transition to Forward with Fairness) Bill 2008 was introduced into parliament on 13 February 2008. The act abolished the making of new AWAs and introduced the no-disadvantage test to ensure workplace agreements could no longer disadvantage employees. That act also started the process to create new modern awards, which, when coupled with the National Employment Standards, will complete a fair and comprehensive safety net of conditions for employees. This is something that the member for O’Connor directly attacked in his contribution in this debate. Award modernisation will result in the creation of around 150 easy-to-find-and-apply modern awards with national application to replace more than 4,000 state and federal instruments.

The next step of the government’s workplace relations reform process was the passage of the Fair Work Act 2009, which commenced on 1 July 2009. It established a comprehensive safety net of minimum wages and employment conditions that cannot be stripped away; a new agreements framework, with bargaining in good faith at the enterprise level at its heart; and a new industrial umpire to oversee the system, Fair Work Australia, and a new education and enforcement body, the Fair Work Ombudsman.

We proposed in Forward with Fairness that a uniform national system would be achieved either by state governments referring powers for private sector workplace relations or other forms of cooperation and harmonisation. Our vision is for a workplace relations system that is fairer, simpler and more flexible and one which promotes productivity and economic growth—a system where businesses, large and small, are covered by one national law and system. This concept has been embraced by several states. The Tasmanian Minister for Workplace Relations, the Hon. Lisa Singh, recently said in that state’s parliament:

Participation in the new national workplace relations system will improve rigour, consistency and address the current jurisdictional and procedural problems.

The Queensland Minister for Industrial Relations, the Hon. Cameron Dick, on 27 October said:

This bill today is a giant step forward in establishing a cooperative system that respects State rights, but also creates an overarching national industrial relations system which is in the best interests of business and workers.

It is not just our state counterparts that are saying positive things about a national workplace relations system. The Australian Industry Group in its submission to the Senate committee inquiry into the provisions of the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 said:

Australia’s modem economy and the need to remain globally competitive necessitates that a national system be implemented. All Australian employees and employers in the private sector should have the same system for employee entitlements and employment obligations.

The Fair Work (State Referral and Consequential and Other Amendments) Bill 2009, which the Deputy Prime Minister introduced to parliament on 27 May this year, was the first stage in implementing this na-tional system. The act supported a renewal of Victo-ria’s referral of workplace relations powers from 1 July 2009 to provide continued certainty of coverage to the working people and employers of Victoria.

It was indicated at the time that the act’s framework would be adapted in future Commonwealth legislation to accommodate anticipated further references of power from other states, while observing that the reference framework may require amendment to account for the views and needs of other states choosing to refer. This bill answers the many calls made by business over many years to end the overlap and duplication of state and federal workplace relations systems; to end the inefficiency, uncertainty and legal complexity for Australian businesses and employees. The Australian Chamber of Commerce and Industry has stated:

The level of complexity created by competing state and fed-eral workplace relations systems is a decades-old problem which has been thrown into sharp relief by our contemporary market economy. Replication, overlap and confusion be-tween state and federal workplace regulation has become increasingly unsustainable.

The Australian Industry Group has also noted the complexity and wastefulness of multiple systems. They said:

On top of this, all but one of the States continued to develop and enhance their own industrial systems. No matter how well many of these systems operate the fact remains that no employer wants to be faced with dealing with six different systems in order to expand its business throughout Australia. The intermeshing and clash of these systems has nourished generations of industrial lawyers.

In answer to these calls, the previous government took the significant step of relying upon the corporations power of the Constitution to regulate for a national workplace relations system. But for many Australian employers and employees, Work Choices only contin-ued—and exacerbated—the problems of complexity, confusion, overlap and waste.

The partnership approach we have with the states is in stark contrast to the bullying tactics of the former coalition government. I take it from the shadow minister’s contribution that this is one of the aspects he has a problem with. He has a problem with the fact that our approach to industrial relations in harmonising or having the powers of these laws ceded to the Commonwealth has been an approach of cooperation. This seems to have brought some opposition from the shadow minister. I cannot even guess as to why the issue of cooperation is such a radical issue for him to grasp.

We want to make sure that these laws work properly. We want to make sure that the states are part of the solution not part of the problem so that we have a national industrial relations system. One of the reasons that Work Choices did not work is that the former government refused to sit down with the states to talk about industrial relations and achieving a national system. Their very arrogant view was that they would do it their way, that the states could lump it, that there was no other alternative. This government takes a very different approach. We try to work with the states in a whole range of areas, one of those being industrial relations.

In the absence of referrals of power from the states, the question of which system applies depends upon whether a business is a ‘constitutional corporation’ or not. That was one of the real problems with the approach of the former government to industrial relations—relying on this constitutional power and not reaching agreement with the states. This brought up some very real, practical problems. It means that corporations that derive revenue through donations—such as charities or through government grants—may not fall within the corporations power. The jurisdictional coverage of an employer can change at any particular point in time if its activities change. For example, a charity raising money for medical research could open a second-hand goods shop to raise funds only to find it is now seen as ‘trading’ and that this leads to a change in its jurisdictional coverage. The approach the former government took was a nonsense in trying to achieve a national industrial relations system by bullying people into their particular philosophical view. The approach we have taken of cooperating is the only way we are going to achieve a national system.

The question of coverage also depends on the nature of the entity running the business. For example, a pro-fessional firm—say, an accounting or medical prac-tice—may run as a partnership or sole trader and be in a state system. A very similar business down the street may be incorporated and therefore in the federal sys-tem and on a different award. And there are many more examples of the perverse outcomes, confusion and complexity that face businesses in relation to the juris-dictional issues of an approach which relies solely on the corporations power.

There are thousands of employers and employees who are not trading corporations but who have been in the federal system for a long time and as a result of longstanding awards made in settlement of an inter-state industrial dispute. These awards were preserved on a transitional basis under Work Choices. In the absence of state referrals of power, employers and employees on these transitional awards would have fallen back to the state systems from March 2011.

For example, approximately 70 per cent of the farm businesses covered by the Transitional Pastoral Award are unincorporated and, without this bill, these farmers and their employees would fall back into state systems. And the uncertainty they were facing under Work Choices was exacerbated by the fact that many farmers operate across state borders and would have had to commence to apply different state and federal work-place relations laws. The uniform national workplace relations system for the private sector will resolve once and for all the confusion and complexity.

Employers and employees will, for the first time, have the same laws, tribunals, minimum conditions, rights and entitlements as their counterparts doing the same work, regardless of whether they are within the same state or across a border; regardless of whether they are trading as a corporation, a sole trader or a partnership. The new national system will make it far easier for businesses and employees to find the infor-mation they need. This is especially important in my electorate of Dobell on the beautiful New South Wales Central Coast where small business is the largest em-ployer. This new system will result in a permanent, intrinsic efficiency for businesses, especially for small businesses that do not have the benefit of specialised human resources staff. With this bill and associated state referrals, the Fair Work system will provide a sin-gle point of access for all private sector workplace rela-tions services for Australia. There will be one website, one phone number, one tribunal and one inspectorate.

As I have already indicated, there is significant support among the states for the national system. Victoria remade its referral earlier this year. The successful passage of referral legislation in the Tasmanian and Queensland parliaments and the introduction of referral legislation in the South Australian parliament followed. Discussions with New South Wales are continuing cooperatively.

The enactment of these references is a vote of confidence in the government’s new fair work laws and marks the next step in the creation of a national system. South Australian, Tasmanian and Queensland businesses will no longer have to deal with complex jurisdictional questions about which system of workplace relations they are operating in. Employees in those states will now benefit from the government’s new fair and balanced laws, including 10 guaranteed National Employment Standards and modern awards. 

The Western Australian government, as the member for O’Connor pointed out, has decided not to refer its industrial relations powers and instead will consider other forms of harmonisation. This decision puts Western Australia completely out of step with all other states and territories and prevents employers and employees in that state from reaping the full benefits of a national system.

Consistent with our Forward with Fairness commitments, the bill recognises that referring states can choose the extent to which matters relating to state public sector or local government employment are included or excluded from references. Victoria has referred its public sector and local governments. Tasmania has also referred its local government employers and employees. Queensland and South Australia have retained these sectors within their state systems.

Once enacted, this bill will give effect to the references of South Australia, Tasmania and any other state that refers its workplace relations matters to the Commonwealth on or before 1 January 2010. These references will enable the Commonwealth to extend the Fair Work Act in referring states to cover unincorporated employers and their employees, outworker entities and extend the operation of the general protections; amend the Fair Work Act so that it applies uniformly in referring states; and establish arrangements for the transition of referral employees and employers from state industrial or workplace relations systems to the new national system. The bill recognises that referring states can choose the extent to which matters relating to state public sector or local government employment are included or excluded from references.

The bill will enable referring states to terminate their amendment references and remain in the national system in the following circumstances: by proclamation of the state governor with six months notice, if the amendment references of other referring states all terminate on the same day; or by proclamation of the state governor with three months notice, if the governor considers that an amendment to the Fair Work Act is inconsistent with the fundamental workplace relations principles.

The fundamental workplace relations principles encompass requirements that the Fair Work Act should provide for, and continue to provide for, a strong, simple and enforceable safety net of minimum employment standards; genuine rights and responsibilities to ensure fairness, choice and representation at work; collective bargaining at the enterprise level with no provision for individual statutory agreements; fair and effective remedies through an independent umpire; protection from unfair dismissal; and an independent tribunal system and an independent authority able to assist employers and employees within a national workplace relations system.

These were the principles that underpinned the government’s Forward with Fairness legislation. They were also the issues that were at the heart of the last election. It should not come as any surprise to the shadow minister that these conditions are there for the states in relation to the referral powers, although he did seem a little confused as to why that might be.

This legislation is part of the ongoing reform of the industrial relations system that this government committed itself to before the last election. This is the next stage in making sure that we have a national system, a system that provides fairness to both employers and employees, a system that is simpler, a system that encourages bargaining, a system that takes away the inefficiencies of multiple layers of regulation through the various state systems and the federal system. This is good legislation that puts in place a national framework. This is something that we went to the last election on. This is something that should be supported by this parliament. I commend the bill to the House.

Sophie Mirabella (Indi, Liberal Party, Shadow Minister for Early Childhood Education, Childcare, Women and Youth) Share this | Link to this | Hansard source

I rise to speak on the Fair Work Amendment (State Referrals and Other Measures) Bill 2009. This bill seeks, among other things, to amend the Fair Work Act 2009 to allow state governments to refer their existing industrial relations powers to the Commonwealth, specifically relating to unincorporated employers. Under the provisions of the bill, state governments will be able to amend or terminate the referral of industrial relations powers to the Commonwealth with as little as three months notice.

Under the bill, any future amendment to the Fair Work Act will not proceed unless it is endorsed by a two-thirds majority of referring state and territory governments. This is quite disturbing. It is an alarming measure because it effectively gives state governments control of the future direction of Commonwealth laws. Although the coalition started the movement towards a national regime in 2006, it is quite disturbing that this is being undermined in this bill through the effective veto that is given to the states.

In addition to that, we see that, if a state does withdraw, the Commonwealth laws as they apply at the time of termination are frozen and operate as at the point of withdrawal. They would continue to be administered at the expense of the Commonwealth. It is a flawed process to get to a national system, as was so eloquently said by the shadow minister earlier this evening. Although the coalition remain supportive of a national workplace relations system, we believe that fundamentally flawed legislation should not proceed.

I share the concern of many small businesses across Australia, particularly in rural and regional Australia, where we know that there is a higher proportion of small businesses than exists in the large capital cities. I share the concern that this bill will not create the harmonious national workplace relations system that Australia needs.

Under this bill, the power to control and determine the national workplace relations system and its operations has effectively been handed to state governments who choose to refer their existing powers. The problems with Labor’s industrial relations changes are well documented. As Labor have done with many policies, sadly, and in neglect of their fundamental duties as a federal government, they have rushed their workplace relations changes. In their panic, they have got it seriously wrong.

Labor have form and this is the template with which they operate. We have seen this with much of the Rudd government’s so-called stimulus package. We have seen billions of dollars wasted on bungled programs, red tape and failed policy. More recently, according to the latest budget forecasts, the Rudd government’s pink batts bill has blown out by a billion dollars and it has had to bring forward $986 million to meet demand. The bill for sheltering 78 Tamil asylum seekers on the Oceanic Viking has topped $1 million, costing $42,500 a day to keep them on the ship. Tax payments to dead people and expats have hit over $46 million. Nearly $1 billion has been spent on consultancies in two years in spite of promises to cut them. Legal fees are in excess of $550 million. The list goes on. The government’s incompetence in coming up with a well thought-out path to a national industrial relations system is no surprise. We should not expect anything different because it has bungled everything else that it has touched so far. Time will catch up with the government. Unfortunately, in the meantime many families and small businesses will be affected. This bill will affect unincorporated businesses in my electorate, many thousands of which are small businesses.

We in the coalition have called on the Labor government to hold off any further changes to the industrial relations system until it gets it right. There is nothing wrong with that. The changes will affect so many people in every corner of Australia that it is important to get them right. The coalition and the shadow minister have been instrumental in making the government’s Fair Work legislation, as was said by the shadow minister, less bad. Among the coalition’s improvements have been the Senate imposed stricter regulations on unions, a compromise being reached on unfair dismissal laws and Labor’s restrictions on greenfield agreements being removed. But that is not enough. This bill is so flawed we will not be supporting it.

One of the most well-documented problems, and one that has caused great alarm across many industries in my electorate, is the government’s so-called award modernisation, which is due to commence on 1 January. Despite the minister’s proclamation that no employer or employee will be worse off under Labor’s new laws, Labor has declined to enshrine this promise in legislation. We know why that is: it cannot keep that promise and it knows that promise will not be the reality for many workers. There is concern that many workers in my electorate in north-east Victoria will be worse off. That is shared not just in rural and regional Australia but in many other parts of provincial and metropolitan Australia.

The whole award so-called modernisation process is not yet complete, but it will be by December, we are told, leaving many employers with less than a month to prepare for a new system. Why? Just because this government wants to rush this through. It wants to be able to tick a box irrespective of whether the box is ready to be ticked. The Minister for Employment and Workplace Relations initially made a concession for restaurants, cafes and catering companies by requesting that they be treated separately from hotels. She came to the table for other industries as well. Her concession is an admission that the award modernisation process would disadvantage certain employers and employees in those industries. The retail, fast food and pharmacy sectors have spoken out against the government’s changes, all with very legitimate claims that they would be disadvantaged under the so-called award modernisation. Who will be the casualties from this bungled process? Who is going to bear the brunt of these government policy failures? It is going to be individual employees, and the impact is going to be felt more severely in rural and regional areas. It is going to be felt more severely there for many reasons, one of which being that people living in a country town are geographically limited in their job choices as opposed to those who live in a city with a population of millions and with hundreds of thousands of employers.

I am already getting correspondence about this process from concerned businesses in my electorate. A local supermarket owner contacted me in regard to the so-called new general retail industry award. He is concerned about the impact that the award will have on his business and his ability to employ people. Many of his employees are working mothers or students who need to have flexible working hours and casual work. But under the so-called modern award he is going to have to pay casual staff $39.48 an hour and $31.58 an hour to work full time on Sundays. He says in a letter to me:

As a concerned employer I do not want to reduce staff but I fear that this may be one of the inevitable consequences of the introduction of this new award.

His will not be an isolated story. Small business owners are integral parts of their communities and towns. They will not want to sack people and they will not want to cut the number of jobs that they can provide in their local community, but they will be faced with no choice because the whole award modernisation process has been handled in such an incompetent and unrealistic way without due regard to the realities and diversity of businesses within particular industries.

In September, the National Retail Association warned that retail costs on Sundays will rise by $100 million due to penalty rate increases. The award modernisation will greatly affect not just those in the retail sector but also those in the tourism sector. If you happen to live in an attractive part of Australia, such as north-east Victoria with its wineries and mountains, and you are a small business in the tourism sector, when do you earn your income? You earn it during public holidays and you earn it on weekends. So these businesses will be additionally hit.

We have also seen the horticultural industry being particularly hit, and local fruit growers have contacted me over many months. Not only are they suffering due to prolonged drought but they are very concerned that the award modernisation process and final outcome will make many of their businesses unviable. They are estimating that there will be an increase of up to $10,000 per hectare. And, believe it or not, fruit is picked when it needs to be picked—if that is on weekends, then it will be done on weekends and, if that is what the wholesale and chain stores demand for delivery on Monday, then that is what needs to be done.

Limits on hours will seriously disadvantage seasonal workers as well. Strict rules on overtime will mean that employers will have to pay workers overtime if they work more than 38 hours in one week. Fruit picking is a seasonal industry. Workers can earn as much as they can when the season is right. Unfortunately, we could see a situation where employers have to restrict working hours. Who knows how this will affect an industry or whether there will be a serious shrinking of the horticultural industry?

As reported in the Australian in September, the Rudd government’s award modernisation process will impose pay cuts on apprentice electricians. Over the last 10 years under the previous Howard government we saw growth in the number of apprentices, and that has been a particularly welcome move in rural and regional Australia. But we are going to see these struggling young apprentices, who do not have an easy time until they finish all their training, have a cut in pay. According to union figures, first year apprentices will be left $34 to $70 worse off per week, which is equivalent to a pay cut of between 12 and 23 per cent. You have to wonder: what sort of process has led a Labor government to penalise some of the lowest paid in our communities? Fourth year apprentices face a cut of $92 to $151 a week. It just defies any reason, any economic sense and any understanding of how tough apprentices do it and what they have to sacrifice—the opportunity cost they give up—to pursue training for their trade.

Why has all this occurred? Because this government needs to pay back some of its paymasters in the trade union movement. That is more important than coming up with serious, well thought out reform in the interests of all Australians and the Australian economy. Instead of imposing their outdated ideology, they should be providing a fair environment in which business can develop, grow and flourish. This bill certainly does not do that. For some time, along with my coalition colleagues, I have called on the government to stop, rethink and suspend the award modernisation process until they can come up with something better. I am sure they can; there are many talented people in the department and I am sure there are many talented people in the opposition who could put their minds to this and come up with a better system that Australians actually deserve, not something that is so substandard. But for some people on the opposite side, in government, those who have put them there and those who pay them to stay there through generous election donations are more important in their list of priorities than the vast pools of employers in every corner of Australia.

For these reasons, for the fundamentally flawed process that is leading to a so-called national system, the coalition will be opposing this bill. In closing, I urge the government to think again, not for the sake of what the opposition says but for the sake of Australian workers and Australian small businesses.

Mike Symon (Deakin, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak in support of the Fair Work Amendment (State Referrals and Other Measures) Bill 2009, and it is a pleasure to follow on from the member for Indi, obviously a committed Work Choices supporter. This bill is subsequent to the Fair Work (State Referral and Consequential and Other Amendments) Act 2009, which mainly dealt with the referral from Victoria to the Commonwealth of powers to make laws in relation to industrial matters. With this bill, the government is continuing to implement its plan for a single national workplace relations system.

As a member from Victoria, I would like to address the history in Victoria with regard to state referrals of workplace relations powers. This is a particularly sorry case study in how not to refer state powers to the Commonwealth. Victoria had previously referred most of its workplace relations powers firstly in 1997 under the Kennett Liberal state government and then in 2003 under the Bracks Labor state government. It must be noted, however, that in its first term the Bracks government did try to reclaim the state IR system. That was blocked by the Liberal controlled Legislative Council at the time. The remaining workplace relations powers in Victoria were transferred to the Commonwealth earlier this year with the passage of the Fair Work (Transitional Provisions and Consequential Amendments) Bill 2009 and Fair Work (State Referral and Consequential and Other Amendments) Bill 2009. In effect, there had been no state workplace relations system for most workers since 1997 in Victoria, although there are some exceptions to this that I will now highlight.

No-one should ever forget the more than 350,000 workers who were stranded under the infamous schedule 1A of Peter Reith’s Workplace Relations Act 1996. That added up to a figure estimated to cover 21 per cent of the state’s workforce at the time. This was the result of a partial referral of Victoria’s IR powers under the state of Victoria’s Commonwealth Powers (Industrial Relations) Act 1996. These workers under schedule 1A were effectively cut off. Denied access to full federal award coverage, they received only five basic conditions—and they were very basic: four weeks annual leave with no loading; one week of paid sick leave; unpaid parental leave; notice of termination; and pay for the first 38 hours of work in a week—no overtime and not necessarily any pay for hours beyond that. It was the Bracks Labor government that remedied this appalling situation in 2003 with the passing of the Federal Awards (Uniform System) Act 2003. This state act referred the necessary powers to the Commonwealth that would then allow for common rule orders to be applied to federal awards in Victoria.

Since that time of course the industrial relations landscape has changed. We saw the Liberal Party, the party of Work Choices, ram through the last parliament legislation that not only denied working people the right to fairness but literally took away already agreed wages and conditions. That the Liberal Party did this without any meaningful debate, consultation or discussion outside their own party room or their cheer squad of right-wing, hardline supporters showed their contempt for the working people of Australia. This contempt for working people was not lessened with their loss of government or changes of leadership. It is there for all to see in their actions in this current parliament.

Although Work Choices was promoted as a national system it fell short of this aim. Apart from being widely despised and resoundingly rejected by the electorate, Work Choices covered around 80 per cent of private sector employees—that is, one in five private sector employees were not covered by the system. These workers might have been employed by charities, partnerships, sole traders, trusts or various other types of unincorporated trading entities, and it took the election of the Rudd Labor government in 2007 and the implementation of our Forward with Fairness policy to turn this around. Creating a uniform national workplace relations system was a key commitment of this policy and, unlike the Liberal and National parties’ lack of consultation, the Rudd Labor government consulted very widely. We discussed, we listened and we changed parts of the bill during the many long months in negotiations with industry associations, employers, academics, unions and other political parties to see the Fair Work Act finally passed through parliament earlier this year.

The commencement of the Fair Work Act brought with it the opportunity to deliver a balanced and modern workplace relations system for Australia. This is a fair and balanced process that, unlike the disastrous Victorian transfer of workplace relations powers, allows for the transfer of state systems to the uniform national system without trapping workers outside award coverage. While the Commonwealth has the power to legislate in the area of workplace relations for most employees, the corporations power of the Constitution on which the Commonwealth relies is limited in its scope, as it applies only to foreign corporations and financial or trading corporations. The precise definition of that is still unclear to many people. Under this power, the Fair Work Act applies only to these constitutional corporations, the Commonwealth and its authorities, and employers who employ flight crews, maritime employees or waterside workers in connection with interstate or overseas trade or commerce.

The Australian Bureau of Statistics has said that, while 80.5 per cent of private sector employees fall definitively within the federal system and 1.6 per cent fall definitively within the state system, jurisdictional coverage of the remaining 17.9 per cent of private sector employees remains unclear. Professor Andrew Stewart, who was recently elected President of the Australian Labour Law Association, has argued:

If passed, the State Referrals Bill will help to create a clear and consistent delineation between federal and State industrial laws.

                   …                   …                   …

The uncertainty over the status of incorporated local government employers, and certain other incorporated government business enterprises, will also be resolved.

Importantly, this bill provides for the application of the National Employment Standards and minimum wages to all national system employees from the start day of the referred powers, and when a state refers their powers to deal with industrial matters this bill will extend the coverage of the Fair Work Act 2009 to unincorporated employers and their employees as well as outwork entities and their employees in that state.

This bill also covers the private sector in respect of state instruments, such as awards and enterprise agreements, that can be referred to the Commonwealth. There is also an option that allows a state to keep in place their own workplace relations system in respect of public servants and local government employees. Having overlapping federal and state workplace relations systems results in uncertainty for employers and employees, increased costs to businesses to comply with the different systems and increased costs to the government to administer, clear inefficiencies and national inconsistencies that need to be ironed out in an advanced economy such as Australia’s. Providing greater certainty to businesses and employers will help avoid confusion and cut red tape. Support for a single national system has been expressed for some time by employer groups, with the Australian Industry Group stating:

Australia’s modern economy and the need to remain globally competitive necessitates that a national system be implemented.

It goes on:

All Australian employees and employers in the private sector should have the same system for employee entitlements and employment obligations.

I note that some employer groups and the opposition have expressed concern over states possibly having an effective power of veto over amendments. As the Senate Education, Employment and Workplace Relations Legislation Committee noted, the right of veto by states exists already with each state having the capacity to terminate a referral of powers. I note also that in the same report the dissenting report by the coalition senators criticised the alleged lack of consultation of the government. I really have to reject that claim and I point out that the Australian people were not once, not ever, consulted before the Liberal Party imposed Work Choices. In its submission to the Senate committee inquiry, the ACTU said: ‘We applaud the consultative approach adopted by the government in working with referring states to determine the scope of their referrals and the transitional arrangements that will apply to employees and employers transferring from the state systems.’

It has been very pleasing to witness the cooperation of the states in this area and, while Victoria referred its powers some years ago and remade its referral earlier this year, as I have already mentioned, we have since seen Tasmania and Queensland refer their powers, whilst referral legislation is currently before the South Australian parliament. The ministers for industrial relations in those states have commended the Fair Work system and the government’s approach to workplace relations reform.

In South Australia, the Minister for Industrial Relations, the Hon. Paul Caica, in his second reading speech to that state’s parliament, said that referral of IR powers would give South Australians:

… an industrial relations system built on the foundation of a strong safety net; access to collective bargaining, including for the low paid; and protection of workplace rights.

The Tasmanian Minister for Workplace Relations, the Hon. Lisa Singh, in that parliament, said that the Fair Work system:

… will ensure that Tasmanian workers enjoy the benefits of a contemporary workplace relations system, comprising a safety net of employee conditions and other arrangements that apply nationally and are at least as good as those under Tasmania’s Industrial Relations Act.

She went on:

Employers will also enjoy the benefits of safety-net conditions and other arrangements with added flexibility or employer protection.

In the Queensland parliament, the Minister for Industrial Relations, the Hon. Cameron Dick, highlighted:

… the Rudd Labor government has been very co-operative in its dealings with Queensland and the other states and territories on the introduction of a national industrial relations system.

Compare that approach to that of the previous government. He went on:

The resulting system sets aside the WorkChoices approach to industrial relations and restores the balance of power to best look after the interests of both employers and employees.

As we can see, the government’s approach to creating a single national system has been endorsed by state governments, employer groups and the ACTU. The increased simplicity of a single national system will also deliver cost savings. State governments currently spend over $60 million each year maintaining duplicative administrative functions and accompanying regulations, costs which can and will be avoided with the transition to a national system.

Although many people like to think that Work Choices is now dead, it is not. It lives on in the hearts and minds of those opposite and, even more tellingly, it shows through in their actions in this parliament day after day. Have no doubt, the Liberal Party is still the party of Work Choices and, if it is left up to them, Work Choices will be back, bigger and badder than ever. We have already heard during this debate their wishes to abolish penalty rates and unfair dismissals and to bring back their beloved AWAs. The passage of this bill will mark the next step in Australia’s transition to a uniform national workplace relations system for the private sector. Although this bill does not mark the completion of this goal, it is an important step in doing so. More importantly, it is another component in the Rudd Labor government’s plan for a fair and effective national workplace relations system.

The Fair Work Act is built on the foundations of fairness for working people, flexibility for business, cooperation between employers and employees, and the promotion of productivity and economic growth for the future prosperity of our nation. I commend the bill to the House.

Jamie Briggs (Mayo, Liberal Party) Share this | Link to this | Hansard source

In the debate on the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 it was fascinating to listen to a member of the ETU—he is now leaving the chamber—discuss how this great reform of a national workplace relations system is seemingly being moved wholly by the Labor Party. That of course is a complete and utter joke. The national system approach to industrial relations was part of the initial announcement in relation to the changes made in 2005 to the workplace relations system by the then Prime Minister. It was a key component of the five principles announced in this place in May 2005. It was the first time that the federal government had sought to introduce a national industrial relations system. In fact, it was the Labor Party, through its states across the country, which spent millions of dollars on a High Court case opposing the national system. So it seems a little strange that the member for Deakin’s notes, which I presume were written for him, failed to pick up on the sheer facts that relate to this matter. Facts of course are not something that those on the other side like to associate with too much on debates about workplace relations. We saw during the last election campaign, particularly in the seat of Deakin, many millions of dollars spent focused on what were distortions of facts on workplace relations and we see the member who was elected, thanks to that false campaign, continue to distort facts in this place today.

The truth is that a national workplace relations system was first proposed by Peter Reith when he was Minister for Industrial Relations. He released a discussion paper, one of several discussion papers post the 1996 reforms to the initial 1996 reforms—the wide-ranging reforms that led to and were part of the untold success story that the Australian economy was for 11½ years. I think the House understands—certainly Glenn Stevens, the Governor of the Reserve Bank, understands this—that the changes made by Peter Reith and John Howard in 1996 played a large part in the success story of the Australian economy over that period. Post those reforms, Peter Reith released a discussion paper in, I think, about 1999, which referred to the advantages of a national system.

I have previously put on record in this place in another debate that I am an unapologetic supporter of a national system. There are some on my side of politics and some on the Labor side of politics who do not support a national workplace relations system. The Minister Assisting the Minister for Climate Change is a well-known supporter of a national system and has been for some time and I acknowledge that fact. However, there are others on that side of politics who do not support it, as there are on this side, and who believe that the states still have a role in workplace relations matters.

I think that, in a modern economy, where state borders and boundaries mean very little, particularly for medium-sized businesses wanting to grow—it is not so bad for large businesses which have IR departments or for law firms on contract which can deal with the complexities of different systems—this reform is a no-brainer. It gives those businesses the opportunity to grow without being restricted or facing red-tape barriers that are the six or seven different workplace relations systems we have operating around the country and which of course have been very conflictive at times, particularly the federal system that has, for a long time, been more complicated than many of the state systems.

Simplifying and reducing the amount of regulation in this area is a good thing and will be a good thing for Australian business going forward. That is why the Liberal Party, in 2005, introduced into this House a bill which created a national workplace relations system. We did so of course by using the corporations power under the Constitution, which was then challenged in the High Court. In the Work Choices case the High Court found that it was permissible within a section of the Constitution to do so. Of course, there has been much discussion as to whether that was a very wide reading of the power. I suspect it was and it has increased the role the federal government can take.

This next step is the right approach to go to. However, this bill is flawed and that is why the shadow minister earlier this evening so eloquently outlined our concerns with it. I do support a national system. I support the coverage of small businesses that are largely left behind. My home state of South Australia—including my seat of Mayo—is a small business state. South Australia is, and has been for a very long time, a small business driven state, more so now than ever before. The South Australian economy has changed largely on the back of reforms made in the 1990s to the economic structure in moving away from a largely manufacturing base economy to a now much more dynamic and flexible economy. We have vast amounts of various industries including a growing tourism industry—particularly in my electorate of Mayo—where small business plays a vital role. The unincorporated businesses in South Australia, I suspect, would outnumber those across most other states. Therefore, this bill will have an additional impact—presuming, of course, that the South Australian parliament passes the state referral bill. I think that is still up in the air.

So I am a supporter of this national approach to workplace relations. However, we have two major objections to this bill. I note that the member for Deakin, and others on the government side, in their contributions have noted the employer organisation, AiG, as evidence for their case. I understand that AiG is actually opposing the passage of these bills, for the very same reason that we do. The first of our two large concerns is that this bill and the agreement that sits alongside it is flawed in that it will require two-thirds of the states to agree to changes being made by the federal system, or, they can pull out over a three-month period while the federal government continues to pick up the tab. In other words, they are holding any future changes to a federal system to ransom for political reasons.

We have seen in the past that the Labor Party takes great delight in using fear campaigns in discussions on workplace relations. In their view that is a perfectly reasonable method of campaigning. We have a great concern—as AiG does—that that provision should be changed. That is one of our objections to this bill. We think that there should be an ability for states to pull out of the system completely, rather than this three-tiered approach. I am interested in what Mr Steve Smith, the National Workplace Relations Director of AiG, had to say before the Senate committee. I am appreciative again of the efforts of Workplace Express to report this. The report said:

In his oral evidence to the inquiry Smith went further, saying AiG was so concerned about the whole package—the legislation, the bilateral and multi intergovernmental agreements—that it did not support its passage. The most problematic element was the provision in the IGA allowing a two-thirds majority of the states to frustrate or block amendments to the Fair Work Act.

In other words, AiG is making the very same criticism that the shadow minister and this side of parliament—the Liberal Party—is making to this bill. We support this bill but we do not support the flawed approach to it. It seeks to hold future governments to ransom. I suspect it is a clever political tactic that the Deputy Prime Minister has dreamt up but it is actually bad policy.

The second aspect on which we have major concerns relates to the operation of the larger Fair Work Act. How the unfair dismissal system operates, good faith bargaining and award modernisation are by far the most public of the issues that have been ventilated in recent times. We have seen concerns from small businesses about award modernisation. I was at a local restaurant a couple of Friday nights ago and the owner of that well-known establishment in Stirling—a very successful local small business employing many local people; you would probably nearly call it a medium-size business as it has been so successful—was very upset by the changes that have been made by this government and the potential changes coming through with the award modernisation project. This has been a complete and utter stuff-up. From industry to industry there has been no doubt about that. I think the Deputy Prime Minister has had to intervene in the process eight times now.

Clearly there is a very troubling trend in relation to the award modernisation project. A lot of small businesses will face a massive increase in costs, particularly in South Australia which has come from a lower base award arrangement. Those small businesses will be picked up and taken to levels which ultimately will cost jobs. So while those on the other side like to talk about protecting employees and workers, and they used to say working families—we do not hear that phrase so much any more—they will be the very people who are impacted on. You will see higher unemployment and fewer opportunities for young people especially in those industries such as restaurants, bars and clubs and so forth where they just will not get a chance in the future because of the increased costs that these small and medium businesses will face. This will be the real impact of the Fair Work changes that the Labor Party have made. They ran very hard in the last election and they spent many millions of dollars. Their paymaster spent more millions than most people could comprehend getting them elected on this issue. This was one of the issues that was fought out in the last election campaign—there is no denying that fact.

However, the test for the Labor Party and for their laws will be: what will be the impact of their laws in the future? What will be the impact on unemployment? What will be the impact on strikes? What will be the impact on inflation and interest rates? We have heard the Reserve Bank governor recently before the House economics committee say that if you put more stoppages into the supply chain, particularly in the resource sector in Western Australia, you will increase pressure on inflation and interest rates, and I think there is a real chance that that is starting to occur.

I will talk briefly in a moment about some of those disputes in some of those big industries across the country, the big employers, because of the tools that have been given now to third parties to intervene in disputes, which they have not had for many years, if ever, in the Australian workplace relations system. I refer there to, in particular, the new provisions in relation to good faith bargaining, which are really a step in the dark for our country. We have never before had a provision where a group of employees—a small group, potentially, out of a workplace—can force an employer to bargain, can actually force an employer to change how they manage their business. And that is the system that we now have. If a small majority of employees decide that they wish to bargain, they can force an employer to do so. They can force an employer to change the way they operate their business. That will have in the future, I suspect, real implications for particularly small and medium sized businesses, which have traditionally had problems dealing with workplace relations. Because of the very nature of the system, it will always be complicated. That is why there are those very highly paid and successful partners in many law firms around the country who focus on this issue for their career, because it is a very technical issue and always will be.

As to the good faith bargaining provisions I think we have seen a significant development today. Again, Workplace Express has reported a decision by Senior Deputy President Matthew O’Callaghan today, relating to a dispute in South Australia where Cadillac Printing has been forced to commence bargaining with its 34 production employees at its facilities in Plympton. The commission, or whatever it is today—Fair Work Australia—was presented with a petition signed by 23 employees indicating their support for the union to represent them in negotiating an enterprise agreement. So this has been accepted: 23 out of 34 have decided that they want to bargain, and the employer is now required to bargain with them. The other 11, of course, are also forced to bargain—or forced to be covered by the terms and conditions of that agreement. The 23 cannot be the only ones covered by the agreement that they want to negotiate; the other 11 are covered as well. So their choice is out the window, even if they are perfectly happy with the arrangements; the other 23 have told them that they have to be covered, and now the employer has to bargain with them. I am not sure how that is freedom and choice in Australian workplaces. It has now been given to a small minority, potentially, to force others to be covered by the system or the agreement they want to be covered by, even if the employer does not want to.

This is the very real concern that we have, particularly on behalf of small and medium businesses. Large businesses will always be able to deal with this. Even if they might not like the laws particularly, they will always be able to find ways to get around or use provisions in the act, and it has been forever thus. However, it has always been the case—and this was always our reasoning with small and medium businesses on unfair dismissals, and remains our reasoning on unfair dismissals today—that small and medium businesses do not have the resources to fully understand or always be across how they are meant to deal with complex legal entitlements or legalistic acts of parliament, whereas larger businesses can employ very well-paid lawyers to do so.

So these are the very real concerns that I am getting in my electorate from small businesses. Many small businesses are concerned by the operation of this new act. I know the government is spending a large amount of money with friendly organisations like COSBOA in trying to explain the new provisions and how they will work. But the truth is that what they have done is change the whole power structure within the workplace relations system in Australia, to the end that unions or third parties can now use their law to force business owners to do something they do not want to do, and I think that is very concerning. I think we will find that that will be a very concerning and economically negative impact of the changes that this government has made.

They will scream—as the member for Deakin and other members have done, as did my friend the member for Dobell, who I think has more problems with some of these third-party interventions than we have—that we are all Work Choices obsessed and want to go back, and it will be bigger and bolder and broader, or whatever the member for Deakin’s phrase was. But what we have said on this is that we recognise that, in the last parliament, there were aspects of the changes that were made that went too far, particularly in relation to the no-disadvantage test. However, this government has gone far too far the other way. They have introduced new concepts into the workplace relations system which will impact negatively on Australian workers because it will reduce their opportunities to get jobs. It will reduce their opportunities to get the real wage increases that we have seen in the last 12 years under the previous government’s changes. It will impact enormously on the economic performance of our country, particularly in relation to interest rates and inflation. They will be seen in the future to be wrongheaded changes and decisions, and it will be seen that we should not have taken the country down that path. That is why we are concerned about having provisions in a bill which will allow any future government’s hands to be tied. It does not make sense. It has never been the case that you could force a future government to accept a policy of the previous government. There should always be the ability for both sides of politics to make changes to legislation, and for state governments, if they desire, to take back their industrial relations system, as the Constitution allowed for in its framing—that unincorporated or small businesses in particular would be covered by state government laws.

So, as to these changes, the overall merit of a national system I think is worthwhile. I support very much a national approach to workplace relations; it will reduce the cost of doing business in Australia, which I think means we will have more opportunities for our young people to get work in quality jobs and to earn more, and it will increase the productive capacity of our economy. I think that removing the regulatory barriers to that is a good thing. However, some of the provisions in this bill, particularly the political provisions in this bill, are the wrong way to go, and that is why we seek to make reasonable changes to this bill, and we hope the government sees the merit in making those changes.

Chris Trevor (Flynn, Australian Labor Party) Share this | Link to this | Hansard source

Today I express my support for the Fair Work Amendment (State Referrals and Other Measures) Bill 2009another step towards ending the tyranny that was introduced by the former coalition government. By this legislation we intend to continue to deliver to hardworking men and women, the backbone of our country and the lifeblood of our nation, the people who invest their hearts and souls into their local communities, our business owners. These people create thousands of jobs and opportunities through their businesses and are a most integral part of regional communities, such as those dispersed throughout my electorate of Flynn.

They have battled long and hard since the inception of the former government’s laws, for with these laws came great confusion and complications that became a minefield for these businesses, particularly small businesses. Without large financial stock, some of these businesses have been unable to seek the legal advice required to understand and implement the laws. The former coalition government left these hardworking people confused, uncertain and oppressed by the financial and time-consuming burden that was the competing federal and state workplace relations systems and the aggravation imposed on them by that insidious piece of legislation, Work Choices.

The amendments proposed in this bill will eradicate this complicated system and provide a fairer, more balanced arrangement that will provide certainty and confidence for business owners. The changes will remove the complexity surrounding workplace relations by providing scope for cooperation between state and federal governments and, with it, the removal of the shackles that have long oppressed private business—large, medium and small—and their employees through confusion and uncertainty caused by the conflicting systems currently operated by the state and federal governments independently.

Our government is an inclusive government not an exclusive government and we as a government have not taken this step without the consideration of its implications for all the parties involved, having conducted extensive consultations with all stakeholders, including the states, the business community and unions. It was through this consultation process that a number of important amendments in this bill were identified. The changes will allow the Commonwealth government to extend the Fair Work Act in referring states to cover unincorporated employers and their employees and outworker entities and to extend the operation of the general protections.

It will amend the Fair Work Act so that it will apply uniformly to referring states and establish arrangements for the transition of referral employees and employers from state industrial or workplace relations systems to the new national system. With this in mind, the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 has been designed to provide a fair, uniform national workplace relations system for the private sector, with exclusions relating to state public sector and local government employment.

The amendments proposed in the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 aim to promote efficiency and to answer the many calls made by businesses in my electorate of Flynn and across our nation to simplify and eradicate this problem and the associated confusion. We have been given an opportunity to further modernise resource-consuming systems and solve a problem that has spanned many years and provided a longstanding headache for businesses and employees. This is a problem that the former government not only failed to address but worsened by adding to the complexity. Today we have been granted an opportunity to right these wrongs and fix this problem. I feel this is an opportunity that we cannot pass up.

In these harsh economic times we as a government should be working to create certainty for businesses. There is no denying that small businesses are the backbone of our country, particularly in regional areas such as Flynn. We should be implementing strategies and systems that create confidence and simplify expansion. That is what the Rudd government and this bill are trying to achieve. By allowing state governments to refer their workplace relations powers to the Commonwealth government, we can provide a simplified unification of the laws and systems, removing the duplications and corresponding costs and complications.

Under the proposed laws, businesses and employees will for the first time be subject to the same laws, tribunals, minimum conditions, rights and entitlements as their counterparts doing the same work, regardless of their geographical location within Australia or whether they are trading as a corporation, sole trader or in partnership. Information will be much easier to locate, increasing efficiency for businesses trying to find it and, subject to associated state referrals, will provide a single point of access for all private sector workplace relations services in Australia.

It is anticipated that the economic benefits of this proposed national workplace relations system will be for not only employers and employees but also the wider community as a result of significant government efficiencies caused by a fairer, simpler national system. By implementing the amendments in this bill, we can revolutionise the workplace relations system and eradicate forever the dilemmas it has caused through its complexity. For small business owners, the bill will deliver more time without the worry of trying to comply with multiple laws and systems regulating the same thing. They will have more time to focus on running their business, more time to grow and expand and, ultimately, more time to give back to their local communities and families.

I firmly believe that we as a government must not miss this opportunity to resolve an issue that has been a longstanding problem. We must act today to remove the complicated multiplicity of an issue that can be so simple. I am a firm believer in promoting effective efficiency. Unnecessary duplication is costly and it is something that I feel all people should strive to remove from their life. It does little more than promote the waste of the most valuable resource we have at our disposal—time. By operating multiple workplace relations systems in Australia this is exactly what we are doing: promoting and allowing waste to flourish. The former coalition government’s costly and time-consuming abyss, Work Choices, exacerbated this waste of resources by complicating the matter further, particularly for small business, which could least afford the expense of legal expertise required to understand the laws.

The major problem faced by businesses and employees alike is the excessive regulation of the current workplace relations legislation which is caused by the duplication and overlap of state and federal workplace relations systems. This problem was aggravated by the former coalition government’s refusal to work with the states, which resulted in both grossly unfair laws and an unwieldy system characterised by legal complexity and uncertainty. The competing systems which overlap in workplaces throughout my electorate of Flynn and the rest of Australia as a result of separate legislation from state and federal governments have made it quite treacherous and costly for businesses to navigate and understand which laws apply to their specific circumstances. For example, there are two businesses providing the exact same ancillary service on an industrial site in my electorate of Flynn, the industrial and economic powerhouse of our nation. One of these businesses is incorporated and the other is operating as a sole trader. This simple difference in structure means one is in the federal system and the other is in the state system. So, despite the fact that they are providing the same services in the same place, they are operating on different awards. This example, which is quite common across Australia, clearly demonstrates the costly confusion and complexity of the perverse overlapping systems.

As I said earlier, the problems are because of the separate workplace relations systems that are maintained by the Commonwealth and five of the six states in Australia. As the examples I mentioned have shown, the multiplicity of systems causes great confusion because of their competing nature, making it excessively difficult and costly for businesses and employees to determine what workplace arrangements they are under. According to ABS data, one in five employees are not sure what workplace relations arrangements they are under, and according to the Business Council of Australia, in some instances the regulatory burden is sufficiently large to make businesses think twice and forgo or defer expansion. These systems are in place to regulate workplace relations systems, not act as a smokescreen concealing the laws and causing confusion to such an extent that people simply do not know what arrangements they are under and invoking such fear in businesses that they are too afraid to expand interstate.

I support the Fair Work Amendment (State Referrals and Other Measures) Bill 2009 and I commend it to the House.

Bill Shorten (Maribyrnong, Australian Labor Party, Parliamentary Secretary for Disabilities and Children's Services) Share this | Link to this | Hansard source

Our Australian version of fairness, of the fair go, has always been inextricably linked to our concept of industrial relations. In the early 19th century industrial relations were governed by laws such as the New South Wales Masters and Servants Act 1828, an act which provided for the imprisonment of workers who refused to work or damaged equipment. Indeed, sneak off for an hour if you dare: one hour’s absence by a free servant without permission meant prison or the treadmill. But of course as the 19th century rolled on unions started to form and combine, first as a kind of friendly society helping out sick work mates, widows and work-orphaned children, and later as the real deal with political clout.

After a long struggle it became almost universally acknowledged that workers were entitled to some dignity at work. They were not just cogs in the machine, to be worn out, thrown away and replaced, but human beings entitled to reasonable conditions, to fairness, to decent hours and to a life of some kind outside of work. In 1856 the eight-hour day was born in Melbourne and the seed had taken root: workers were individuals due proper respect. This was extended through the concept of the living wage, the family wage, determined first in the Harvester judgment of 1907, a case that was triggered by a dispute in the western suburbs of Melbourne within my electorate of Maribyrnong, in the suburb of Sunshine.

Australians have understood and accepted the idea that people’s democratic rights do not cease when they step onto the factory floor, through the farm gate, into the shop or indeed into the office; the idea that employment is not just the grace or favour or the whim of the employer but should be governed reasonably by principles of justice that could be enforced by independent rules; the idea that workers have the right to organise and be represented by unions when they are unable to effectively represent themselves; and that not all wisdom about how an organisation should be run is held at the very top by the owners and the managers. Indeed, they recognise that workplaces should be equitable and run in cooperation and harmony between employees and employers. These are the workforces which unlock the potential of workers, to the benefit of everyone. As the previous unlamented government found out, those who do not respect the Australian public’s bedrock values about fairness in the workplace do so at their peril. The Fair Work Amendment (State Referrals and Other Measures) Bill 2009 continues the journey to build a framework that provides a fair and modern national workplace relations system for the private sector.

This bill has been the subject of comprehensive negotiations with the states and is part of the Rudd government’s efforts to create a national system of industrial relations with fairness, productivity and flexibility at its heart. We are not following the example of the previous government, which introduced the divisive policy called Work Choices—a truly Orwellian name. This was a policy which slashed conditions through unfair statutory contracts, removed the right of workers to join unions and stripped away protection against unfair dismissal.

What we are doing here tonight goes to the heart of the difference between those of us on this side and the opposition. What we are doing here is both economic and social policy. Work Choices, sadly, was an obsession, not a policy. It was a Howard-Costello neurosis, untreatable by modern medicine. It was a rabid set of views, poor in principle and poor in practice and rightly rejected by the Australian people. It was a policy which led to a sorry trail—and a sorry tale—of cut wages, lost entitlements and reduced protections. Work Choices had its effect in every street and at every kitchen table. Everybody knew someone who had been dudded by an Australian workplace agreement, who had been humiliated by the fear, the panic and the hope and then the anticlimax of losing a good job one morning and being offered a worse job doing the same thing for less money and under worse conditions the next morning.

One may be familiar with the evidence from the Office of the Employment Advocate about Australian workplace agreements under Work Choices, but it bears revisiting: 51 per cent of them cut overtime loading, 63 per cent cut penalty rates, 64 per cent cut annual leave loading, 46 per cent cut public holiday payments, 52 per cent cut shift loadings, 40 per cent cut rest breaks, 46 per cent cut incentive-based payments and bonuses, 48 per cent cut monetary allowances and 36 per cent cut declared public holidays. What a blatant grab for conditions fought and negotiated for for over a century. The previous government did not try to reintroduce the treadmill, but they did everything but.

As part of my previous work I spoke to a lot of senior managers and CEOs. They knew too well that Work Choices was first and foremost an ideological agenda, one which bore little relationship to the genuine, effective labour market reforms which were needed and had pretty much nothing to do with providing answers to some of Australia’s biggest challenges, such as productivity. The previous government’s blinkered and bullying approach and refusal to work with the states led to a system that was not only unfair but also increased the legal uncertainty and complexity of an already complex system. This should not be how we handle workplace relations in the 21st century.

Instead, the Rudd government is working with the states to create a national system which will be as simple as possible whilst protecting the right of people at work to fair treatment. In the 21st century it is innovation and knowledge which are becoming the main drivers of economic growth around the world. In order to create these conditions it is businesses—and indeed nations—that invest in people and use their potential to the fullest who will succeed. Australia is a small nation on a vast globe, and the world does not owe us a living. That is why the future for our businesses cannot be based on cutting wages to match the lowest-dollar overseas competition for payment of humans at work. That is why industrial relations should be about fairness, not fear. That is why it must be about flexibility—about giving people real choices as they increasingly move in and out of the workforce, from job to job and from career to career. That is why it must be about simplicity and certainty, especially for small- and medium-sized businesses.

The Fair Work bills which have been introduced by this government are based on that enduring principle of fairness whilst meeting the needs of our modern economy. They balance the interests of employers and employees and the granting of rights with the imposition of responsibilities. The Workplace Relations Amendment (Transition to Forward with Fairness) Act 2008 was introduced into parliament on 13 February 2008. It abolished the making of new AWAs, which I referred to earlier, and introduced the no-disadvantage test to ensure that workplace agreements could no longer disadvantage employees. That act also commenced the process to create new modern awards, which when coupled with the National Employment Standards will complete a fair and comprehensive safety net of conditions for employees.

Award modernisation will result in the creation of around 150 easy to find and easy to apply modern awards with national application to replace more than 4,000 state and federal instruments. We have delivered a fair and comprehensive safety net of minimum employment conditions that cannot be stripped away; a system that has at its heart bargaining in good faith at the enterprise level. This is essential to maximise workplace cooperation and improve productivity—productivity which had shamefully fallen during the Howard years. We have delivered protections from unfair dismissal for all employees. And, indeed, we seek to deliver a balance between work and family life and the right to be represented in the workforce. These rights are guaranteed by the legislation and overseen by a new industrial institution, Fair Work Australia, which will operate with both independence and balance. Once enacted, this bill will give effect to the references of power to be made by the great state of South Australia, from which the Minister for Sport and Youth Affairs comes; the great state of Tasmania, which elected only government members of the House of Representatives in the last election; and any other state that refers its workplace relations powers to the Commonwealth on or before 1 January 2010.

The bill will give effect to references of matters relating to workplace relations from the states to the Commonwealth for the purposes of section 51(xxxvii) of the Constitution. These references will enable the Commonwealth to: extend the Fair Work Act in referring states to cover unincorporated employers and their employees and outworker entities and extend the operation of the general protections; amend the Fair Work Act so that it applies uniformly in referring states; and establish arrangements for the transition of referral employees and employers from state industrial or workplace relations systems to the new national system. Referring of power to the Commonwealth will end much of the confusion that bedevils smaller enterprises who may fall under the state or federal system, depending on how their business is structured. At the moment a farmer who operates as an unincorporated family trust for tax and other reasons is in the state system and may be right next door to a similar farmer in the same market who operates under a company structure and is subject to different laws and awards.

It is ridiculous for charities to have to worry about whether they will move from one system to another if they open a second-hand shop to raise money for disabled children and other charitable activities. For all of these reasons, there is significant support among the states for the national system. My home state of Victoria remade its referral earlier this year. The successful passage of referral legislation in the Tasmanian and Queensland parliaments and the introduction of referral legislation in the South Australian parliament followed. I am pleased to report that discussions with New South Wales are continuing cooperatively. Only the Barnett government in Western Australia has said it will not refer powers, which is a statement that is opposed by the Western Australian Chamber of Commerce and Industry, who in my industrial experience are not automatically strong supporters of all that Labor does federally. For whatever reason, the Western Australian government has chosen to stand outside the benefits of being part of the national system, and I would hope that in time it reconsiders its decision.

I am pleased to report that there is also support from industry. The Australian Industry Group said as early as 2005:

No matter how well many of these systems operate the fact remains that no employer wants to be faced with dealing with six different systems in order to expand its business throughout Australia. The intermeshing and clash of these systems has nourished generations of industrial lawyers.

Although, I should say, some of them have gone on to work for the Australian Industry Group—but be that as it may. Other estimates have put the cost of maintaining the duplication of industrial relations systems at over $100 million a year. Replication and overlap between state and federal systems is becoming more and more of an anomaly in an economy where increasing numbers of businesses are operating in more than one state. The Australian Chamber of Commerce and Industry issues paper on the subject, again written as early as 2005, said:

… current multiple overlapping systems of Commonwealth and State regulation on employment laws are the product of colonial disputes of the 1890s—

and those decades immediately after—

and unsuited to the modern era of national economic integration and globalisation.

Genuine reform of our industrial relations systems based on cooperation with the states will do more to encourage employment and improve productivity that any of the harsh and punitive so-called reforms that were part of the unlamented Work Choices.

I hope that, with the passage of this legislation, we will see the completion of one of the goals of the Rudd government, a government that keeps on delivering on its election promises—to establish an industrial relations system based on the understanding that workers and businesses need certainty and protection; to understand that fair treatment of workers is not an optional extra but is the foundation of our prosperity; and to recognise that a modern industrial relations system is one that encourages and rewards the innovators.

The businesses which work to improve the potential of their workers and increase their productivity, rather than engage in a race to reduce their wages and conditions, and create rewarding and sustainable jobs are the future businesses of Australia. We want to create a system that will lead to workplaces where our children do better than we did and where Australia’s continuing prosperity is forged. I commend this bill to the House.

Steve Georganas (Hindmarsh, Australian Labor Party) Share this | Link to this | Hansard source

A matter of months after this Labor government moved to repeal the Howard government’s shameful Work Choices legislation with the introduction of the Fair Work Bill, I am very proud to stand here, as are all my colleagues on this side of the House, to say that we are taking it a step further and are making it even fairer for Australia’s workers and employers alike.

The Fair Work Amendment (State Referrals and Other Measures) Bill 2009 will streamline our workplace relations system so that everyone concerned gets a fairer go. By replacing multiple workplace relations systems across Australia it will not only give employees greater security and certainty about their basic rights at work but reduce costs for the businesses themselves. This is a win-win situation for both employers and employees and, at the same time, cuts government costs and better uses the Australian taxpayers’ money.

The Fair Work Act was introduced on 1 July 2009 to abolish the coalition’s draconian industrial relations regime, cynically called Work Choices. It replaced it with something fair for all working Australians. Now we go one step further in the initiative to rid Australia of the most extreme, unpopular and unfair industrial relations system this country has ever seen. In doing so it makes it even fairer for workers and, of course, for those who employ them.

The bill will remove the state-by-state approach to industrial relations and will remove duplication and inefficiency from our workplace relations system. Currently the Commonwealth and five of the six states maintain separate workplace relations systems. This is slow, frustrating and simply not a practical way of dealing with something that affects all working Australians. We do not need the confusion and uncertainty that exists when each state has a different approach to industrial relations. This bill will do away with such inconsistencies. It will exclude state industrial legislation on antidiscrimination and equal employment opportunity, workers compensation, occupational health and safety and child labour so that there is a national, balanced and fair approach to these vital issues.

The amendment bill will produce results beyond the workplace by simply allowing the Fair Work Act to operate more smoothly. Every Australian taxpayer will benefit. Their taxes will not be wasted on maintaining and enforcing separate, competing workplace systems when one system is more cost-efficient and workable. As it stands, each of the states has its own workplace relations process. It has its own industrial tribunal or court. Each state has separate government departments for policy development, program and education management, compliance and tribunal services at a cost of more than $60 million a year. This is an expense we neither need nor want. We will not know the exact savings until the amendment bill is passed and the changes are made, but I am sure that they will make a big cut into that $60 million as we stop duplicating the delivery of these services.

Even the Australian Chamber of Commerce and Industry has thrown its weight behind the need for a single-handed approach to our workplace relations system. It has issued a paper stating that the various state and federal systems and tribunals benefit no-one by creating unnecessary difficulties and technicalities in dealing with our industrial relations system. The Chamber of Commerce and Industry has described the overlapping of federal and state regulations as a major national failing. It has called for urgent reform to address the confusing and costly exercise of having six separate workplace relations systems. The Australian Industry Group has also called for reform, describing the current situation as wasteful. The Productivity Commission has also called for rationalisation of the system as multiple agencies in the same jurisdiction perform exactly the same function.

Access Economics, in a report it prepared for the Business Council of Australia, criticised eight bodies doing what could be better managed by one. The Business Council itself is on record as saying that a simpler national workplace relations system is imperative to Australia’s international competitiveness and productivity. These are not worker groups or employee or union advocates talking. These are business groups calling for a simpler method so that the employers themselves can better understand what is required of them and the right thing to do. The current competing systems create greater costs for the individual workplaces as they struggle to understand, and comply with, different sets of rules for each and every state. The fact that there is often confusion over which jurisdiction should deal with a particular case can cost everyone involved time and money. It is just common sense to simplify and streamline the process. A national workplace relations system for the private sector cuts through the confusion and the potential costs across the board.

In the electorate that I represent, Hindmarsh, in Adelaide’s west and south-west, there are approximately 40,000 full-time and 20,000 part-time workers who know that this amendment bill will give them a better deal and greater security. More than 30 per cent of the Hindmarsh labour force is employed on a part-time basis. That is well above the national average. This amendment bill will give those workers greater protection and peace of mind. The factories, offices, warehouses and retail outlets that employ them—from Glenelg up to Semaphore Park, through to Adelaide Airport and across to the industrial hub of Mile End—know that they are going to get a better and fairer deal as well.

Hindmarsh is home to some major employers, and many of them have national and international profiles. For example, Arnott’s has a major factory presence in Marleston and employs over 400 people; Westpac has its national call centre based at Lockleys; and Ikea, with its expansive retail outlet at Adelaide Airport, has become a massive employer. Then there are the airport companies and airlines such as Qantas, Virgin Blue, Jetstar and Tiger, the 14 regional airlines and the many local, national and international freight and courier companies that employ people in the electorate of Hindmarsh. This amendment bill will help these companies. It will ensure that they are covered by the legislation. They will not need to worry about different workplace systems; they will all operate under a uniform national law. This is good news for them and good news for the thousands they employ in Hindmarsh, let alone all around Australia. It will allow these companies to get on with business. A fairer workplace relations system will promote productivity and economic growth for the people, businesses and companies not only in Hindmarsh but right across Australia, with its workforce of almost 10 million. Even though the Fair Work Act has vastly improved an inefficient and unfair situation, it will be further improved with one national law and a uniform system. The Fair Work Amendment (State Referrals and Other Measures) Bill 2009 will create uniformity and fairness. It has taken a lot of hard work to fix the industrial mess left by the Howard government, and we are continuing to do that work. This amendment will go a long way towards making that right.

Many of the migrant workers in the electorate of Hindmarsh came to Australia throughout the fifties and sixties. They were employed in back-breaking work during that period and a lot of them are now retired. That workforce is being replaced by new arrivals from Africa, Asia and the Middle East, and they are now working in the lowest paid jobs available. When I look back at the success of Australia’s migration story, I see the people in my electorate who came here with very few language and employment skills, yet they carved out a living for themselves and their families and made a success of their life in this country. A reason for that was the collective agreement maintained for many years amongst workers. This enabled migrant workers to have the same rights as anyone else on the factory floor. It enabled them to have their rights respected and to be collectively represented by their union. The industrial relations legislation of the Howard government tried to break up that collective. We saw many examples of unskilled workers in low-paid jobs who were taken advantage of under the Work Choices legislation. I am very pleased to say that our bills, from the Fair Work Bill through to this amendment bill, are all about improving the situation for workers by ensuring fairness in the Australian workforce. Therefore, I commend this bill to the parliament.

Jason Clare (Blaxland, Australian Labor Party, Parliamentary Secretary for Employment) Share this | Link to this | Hansard source

Tonight we saw the Liberal Party’s commitment to Work Choices on display again. The Australian people know that Work Choices was unfair and divisive; that is why they rejected it—and the AWAs that slashed the safety net and took away basic entitlements—at the last election. Most Australians rightly think that Work Choices is now a thing of the past, but tonight we see again that the opposition is simply unable to go the final step and fully implement a national system that is based on fairness and decency.

The Rudd government wants a workplace relations system that is fairer, simpler and more flexible, a system that promotes productivity and economic growth. The Fair Work Act ensures that Australia is competitive and prosperous without compromising workplace rights and guaranteed minimum standards. These are fairer laws that balance the needs of employees, the unions and employers; that ensure that all employers and employees have access to transparent, clear and simple information on their rights and responsibilities; that give Australian employers confidence with a simple, fair dismissal system for small businesses; that protect employees by setting fair minimum wages, assisting low-paid and vulnerable employees and those without access to collective bargaining; and that ensure employees freedom of association in the workplace. The government’s new workplace relations system will provide a strong safety net that workers can rely on in good and in uncertain economic times.

The government is getting rid of the extreme Work Choices laws, the laws firmly rejected by Australians at the last federal election. Our workplace relations laws are balanced. No one side has got everything it wanted. The laws are fair to employers and employees and balance the giving of rights with the creation of responsibilities. Our laws bring the workplace pendulum back to the middle where it belongs and where Australians want it to be. The government’s new fair and balanced workplace relations system has enterprise bargaining at its heart to drive productivity. Our laws are about bargaining in good faith at the enterprise level, underpinned by a fair and decent safety net of employment conditions. This is good for employers, good for employees and good for the country.

Having built the Fair Work Act, we are now committed to building a system where all businesses, large and small, are covered by one national law and system. Work Choices was so contentious, so reviled, that it could never have formed the basis of a national system that completely covered the private sector. The values of Work Choices—‘You’re on your own,’ no safety net and no fair go at work—were so strongly opposed by the Australian people that it could never have formed part of a national system. It is only the Rudd Labor government’s delivery of the Fair Work Act 2009 that has been able to bring our national system to fruition.

But we now hear today that the opposition has walked away from the fairness of the Fair Work Act. After supporting legislation establishing Victoria’s referral into the system, we have seen a monumental backflip, a backflip based on misleading information and scaremongering. The opposition has resiled from providing protection from unfair dismissal for Australian workers. The Liberal Party now has a clear agenda to take away these rights from Australian workers. The opposition now says it is outrageous that an employee can be represented by a top-end-of-town lawyer, a right that has never existed in the previous system. The opposition now makes it clear that it wants employees to have no rights during bargaining, no rights to be represented by a person they choose; it should be a choice for the employer in the world of Work Choices.

With the Fair Work Act, we now have a fair, democratic framework for enterprise bargaining: the right to be represented and the right to a good-faith, fair bargaining process, bargaining that is underpinned by a decent safety net, avenues for assistance if negotiations break down, protection of the public interest when industrial action occurs, assistance to bring new sectors into bargaining and a streamlined, flexible bargaining system that meets the needs of all kinds of workplaces. Now we know the opposition’s position. They want the employer to have the right to negotiate directly with their employees. What does that mean? It means individual agreements with no right to be represented. So now we know. The opposition say it is too soon to bring the states into the system, too soon after 12 years of the Howard government’s failure to deliver a national system, after the endless reports it commissioned and after decades of pleas from business for a seamless national system. The opposition’s resiling from this reform is short sighted, petty and without vision—exactly what we expect from the opposition.

But let us get back to the bill before the House. We have worked cooperatively with the state governments and have demonstrated once more the Rudd government’s commitment to achieving important national reform through cooperative federalism. We now mark the next stage in implementing our plan with the Fair Work Amendment (State Referrals and Other Measures) Bill 2009. I remind the Senate that the primary purpose of the bill is to amend the Fair Work Act to enable states to refer workplace relations matters to the Commonwealth for the purposes of section 51(xxxvii) of the Constitution and the creation of a uniform national workplace relations system for the private sector. This will end the overlap and the duplication of state and federal workplace relations systems and end the inefficiency, uncertainty and legal complexity for Australian businesses and employees. The bill also amends the Fair Work (Transitional Provisions and Consequential Amendments) Act 2009, the T and C act, to establish arrangements for employees and employers transitioning from referring state systems to a new national system and consequential amendments to other Commonwealth legislation required as a result of these arrangements.

Much has been said about the benefits of a national system. For the benefit of the House, I will canvass some of those points. The Australian Chamber of Commerce and Industry has been advocating for a single national workplace relations system for many years, including in its recent submissions to the Senate committee. The Australian Industry Group has also been a long-term advocate of a national system. Since the introduction of this bill into the House some weeks ago, I am pleased to note the passage of legislation in the Tasmanian and Queensland parliaments of laws to refer private sector employees and employers into the new national fair work system from 1 January 2010. Tasmania’s and Queensland’s referrals follow the Victorian government’s referral of powers in June this year. I am pleased to report that the South Australian referral legislation has passed the parliament this evening.

The workplace relations ministers from each of these states have noted publicly the extensive stakeholder consultation undertaken by their governments in reaching decisions on referrals, the broad stakeholder support within their states to participate in a national workplace relations system and the significant benefits that employers and employees in each state will enjoy as a result of the referral. Ministers have also noted that their respective referrals have only come about because of the Fair Work Act 2009, because the laws passed by the Rudd government achieve the right balance between flexibility and productivity on the one hand and fairness and decency on the other. Fairness and decency were, of course, the principles that were gutted under the former government’s extreme and unfair Work Choices legislation.

But perhaps all of this effort is for nought. In the desperate desire to hang on to Work Choices, the opposition appears to be prepared to throw away any chance of achieving a national system, and that desire is all based on misconceptions and untruths. A number of issues were raised in the debate that I now seek to address. First is the termination of the amendment references. The opposition raised concerns about the manner in which amendments to the national scheme can be made. The opposition completely fails to understand cooperative federalism and the importance of a national workplace relations system. Referrals are essential to complete a national workplace relations system. States do not refer matters lightly and they seek to be satisfied that the national legislative scheme is and will remain appropriate for them.

The nature of references of matters under our Constitution means that responsibility for the ongoing scheme is necessarily shared between jurisdictions. This has already occurred for the corporations law, the national water system and others. In recognition of this shared responsibility and the states’ constructive approach to the national system, the commonwealth has committed, in the intergovernmental agreement, to consult referring states on proposals to amend the Fair Work Act. Under the intergovernmental agreement, the IGA, it is only if a state considers that a particular amendment infringes on the fundamental workplace relations principles set out in the bill that proposed amendments are referred for relevant ministers’ further consideration. It is only for these kinds of amendments that the IGA commits the Commonwealth to not pursue amendments—unless they have the support of a two-thirds majority.

For other amendments—for example, to correct a defect or make a process work more effectively—the Commonwealth is merely obliged to consult referring jurisdictions. It is common for referral schemes and associated IGAs to include these kinds of processes for consultation, voting or approval of Commonwealth proposals to amend the national law. The bill recognises that if there are radical changes to the national system a state may no longer wish to participate.

Coalition senators have said that the bill should provide for states to terminate their amendment reference at any time, for any reason, subject to the provisions of an appropriate notice period. The bill already allows for this. A state can terminate its reference at any time by proclamation and will then cease to be in the system. Of course, all employers and employees in the national system are under the Commonwealth’s own power; that is, all employers that are trading corporations and their employees will remain in the national system.

The bill also enables a state in two circumstances to terminate its amendment reference but to nonetheless remain in the national system, effectively suspending the national law—as for referred employers and employees—as it was enacted at the time of the proclamation. This occurs, first, if all other referring states terminate their amendment references on the same day, which is a standard feature of reference schemes after six months notice; and, second, if the state governor considers that an amendment to the Fair Work Act is inconsistent with the fundamental workplace relations principles with three months notice.

Taken together, the IGA and the referral bill provide a safeguard for referring states and ensure that amendments to the act cannot be imposed on the states in a way that undermines the fundamental agreed features of the new national system. In the absence of these safeguards, states may decide not to refer and this would put at risk the uniform national system that businesses and others have long demanded. By opposing these arrangements the opposition demonstrates, once again, its reluctance to work with states on national reform and its refusal to let go of the extreme elements of Work Choices which were so comprehensively repudiated by Australians at the last election.

On the issue of consultation, the development of this bill is a shining example of what can be achieved with cooperative federalism. Coalition senators are critical that there was no COIL process. It should be noted that when dealing with referral legislation it is the states that are the primary stakeholders. There had been wide-ranging discussion with the states on all aspects of this bill. States, in turn, consulted very extensively with their stakeholders, both unions and employers, before deciding to participate. These consultations were set out in great detail in the department’s answer to an opposition senator’s question. There were literally dozens and dozens of meetings, over many months, with those affected in each of the relevant states. I can assure the House that the Rudd Labor government will continue in this spirit of consultation and openness. This spirit of cooperative federalism will continue.

The opposition is, once again, critical of the award modernisation process and continues to take cheap political shots at the commission and the process. We are replacing literally thousands of state and federal awards with less than 125 simple, modern awards. This is a massive and important reform. It is no easy task, but it is one which is on track to deliver significant benefits to employers and employees.

I remind the House that this is a reform the coalition fundamentally supports but could not deliver, despite 12 years in office. For state system employees and employers the bill provides for a sensible, measured and orderly transition to modern awards. State awards will be preserved as federal instruments and will continue to apply, in the exact same form that they currently exist, to referring employees and employers for a full 12 months. After that time, a modern award will apply. However, during the 12 months, Fair Work Australia will be required to consider whether a modern award should be varied to provide appropriate transitional arrangements for incoming state employees and their employers, as the AIRC will already have determined to include a five-year transitional arrangement for all employees and employers currently covered by state-based conditions. This means there will be a five-year transition framework already in place that translating state reference employees and employers can be slotted into when they become covered by modern awards.

In closing, I remind the House that the government intends to have a national system in place by 1 January 2010. This is in the interests of all users of the system to ensure there is certainty and clarity, noting the commencement of the National Employment Standards and modern awards. I commend the bill to the House.

Question put:

That this bill be now read a second time.