Paul Fletcher (Bradfield, Liberal Party, Parliamentary Secretary to the Minister for Communications) Share this | Link to this | Hansard source

When I was speaking previously, before I was interrupted by the inexorable procedural workings of this House, I was making the point that, in the brief time available to me, I intended to cover three matters: firstly, that the Labor Party took the workplace relations environment back to the 1970s, as the Rudd-Gillard-Rudd government engaged in a colossal act of payback to its union mates; secondly, that the reforms contained in this bill form part of the critically important policy agenda of increasing productivity and efficiency in the Australian economy, which is something that I would hope all members of this House agree is of vital importance; thirdly, that in the policy that the coalition took to the 2013 election to improve the fair work laws, we made specific and detailed promises, and the bill before the House this afternoon is about giving effect to those promises.

Let me turn, firstly, therefore, to the proposition that under the Rudd-Gillard-Rudd government we saw a government which was determined to return the workplace relations environment back to the bad old days of the 1970s. We saw a government which was craven in its desire to advance the agenda of union officials in a way that we had not seen in Australia for many years. I want to speak specifically about the question of the right of entry, and I want to make it very clear that the coalition has a fundamentally different view about the question of the right of entry to that which was advanced by the previous Labor government. In the view of the coalition, the right of entry into a workplace for union officials is a specific privilege granted under statute to which appropriate conditions ought to apply. Unfortunately, union bosses and officials take a different view. It suits their convenience and their particular view of the world that they should have an untrammelled and automatic, very wide ranging right of entry. They are not interested in considerations of efficiency, productivity or the impact on the efficient operation of the workplace. Those are not their agenda or concern. But as a national government, we are certainly interested in these considerations and think they are policy considerations of the highest order.

I am sorry to say that the previous Labor government and key figures within it said one thing in the lead-up to the 2007 election and did very different things in the area of the industrial relations when they came to government. In 2007 the Labor Party and some of its key figures promised on multiple occasions that if they came to government there would be no changes to the union right of entry laws. What did we hear from then Deputy Opposition Leader Julia Gillard on 28 August 2007? She said:

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

In other words, they would maintain the existing legal framework dealing with right of entry. These were reassuring words, words calculated to give the impression that she and her Labor Party colleagues were thinking about the broader policy perspective to do with this issue and not the narrow, self-interested agenda of the union bosses and the union officials.

But, of course, what did we see as soon as Ms Gillard and her colleagues got into government? We saw that the previous promises and assurances given in relation to the question of right of entry were abandoned. Under the Fair Work Act legislation that, as minister, the then member for Lalor, Ms Gillard, introduced, the unions—union bosses and union officials in particular—were given much easier access to workplaces than they had previously had. That is a very unfortunate demonstration of the fact that the previous Labor government evidently saw its highest policy priority as giving effect to the agenda and the desires of union bosses and union officials.

I am also sorry to note that the consequence of this change to the legislative framework was that a set of provisions was inserted into law that were then routinely exploited by many union officials. The consequences were extremely severe in many workplaces and businesses that were seeking to get on and improve production, operate efficiently, generate profits, generate returns for their owners, generate secure working conditions and employment for their employees, and meet their various stakeholder responsibilities. In seeking to do that they were routinely disrupted by militant union officials who were keen to use the new powers that had been handed to them by the Labor government acting to give effect to the agenda of union officials and union bosses. We saw many businesses facing an extraordinarily excessive number of workplace visits from union officials. This occurred even when employees at the workplace were not union members and even when the employees had not requested the union's presence. But, of course, the whole notion of workers having the right to choose whether or not they are represented, and in particular having the right to choose not to be a member of a union, is something that makes the blood of union officials boil, it makes their teeth grind, and of course they will do everything they can to resist that principle.

The Fair Work Act review panel—no biased set of people from one side or the other—noted a number of examples of precisely the phenomenon I have just spoken about. The Pluto LNG project received over 200 right-of-entry visits in just three months. BHP Billiton's Worsley alumina plant faced 676 right-of-entry visits in a single year, imposing an extraordinary burden on the efficient operation of these facilities.

But I am sorry to say it did not stop there, because by 2013 the responsible minister, the employment and workplace relations minister, was no longer the former member for Lalor. It was by this time the notorious member for Maribyrnong, who had, prior to coming into the parliament, been a prominent union boss, and who by this time was in a position where he could to the maximum extent possible give effect to the agenda and policy objectives of union bosses and officials. And he wasted no time in doing that, adding to his sorry record across a whole range of portfolios. He introduced further objectionable amendments to the Fair Work Act, which gave statutory authorisation to lunch room invasions. Union bosses now have the right under the provisions introduced by the former Minister for Employment and Workplace Relations—and, I need hardly add, current Leader of the Opposition—to insist on addressing workers in their lunch room, even when the workers have not requested their presence and are not union members. This is entirely unfair to that very substantial majority of people who are not union members. I remind the House that approaching 90 per cent of people in the workforce in the private sector are not union members. Yet those workers are now exposed to the ever-present risk of having their desire to peacefully sit there and eat their sandwiches or soup disrupted at any time by an unwanted, unwelcome visiting union official insisting on haranguing them. We say that it is time to put an end to it.

The former Minister for Employment and Workplace Relations not only introduced this highly objectionable provision but also introduced another highly objectionable provision: a ludicrous obligation that employers would be required to pay for the cost of transport of union officials to remote work sites, such as offshore resources projects. This created an employer funded union boss joy-ride, a scheme that has been extensively abused.

But this is not the only objectionable provision the bill before the House seeks to correct. Another example of the 1970s style union practices that we saw under the previous government was the loophole in the law they were quite happy to leave in place that allowed employees to strike first and talk later. That is simply getting things the wrong way around.

Secondly, I want to make the point that this is an issue of productivity and of efficiency. The trends are very clear when you look at days lost due to industrial action. Under the previous Rudd-Gillard-Rudd Labor government, working days lost just in the building and construction sector—a sector that has been exposed for the notorious union militancy of the CFMEU, a union that shows a continual disregard for the rule of law—jumped form 24,000 in 2011-12 to an estimated 89,000 in 2012-13.

Lastly, I want to turn to the fact that in our policy in this area, coming up to the 2013 election, the coalition made very clear and specific promises. Nobody could have the slightest doubt about what we stood for and what we intended to do. But I might further add that the measures contained in this bill are not only those that were promised by the coalition before the 2013 election. They include measures that the Labor Party had committed to before the 2007 election but then took a different path once in government.

The measures in this bill are intended to restore certainty to the workplace relations systems. They will amend the right-of-entry provisions to address the imbalance introduced by Ms Gillard's Fair Work Act. This bill will fairly and sensibly balance the right of employees to be represented in the workplace, if they wish to be, with the right of employers to go about their business without unnecessary inconvenience and disruption. There will be no more lunchroom invasions and union boss joyrides. This bill will amend the act to extend good-faith bargaining rules to the negotiation of greenfield agreements to improve standards of bargaining conduct. This bill will also implement a number of recommendations from the 2012 Fair Work Review Act Panel that will improve the operation of the individual flexibility arrangements provision under that legislation. And, very importantly, this bill will remove the 'strike first, talk later' loophole under the Fair Work Act. This is a very important bill before the House. It implements measures that were contained in our policy, and it is about improving productivity and efficiency and striking the right balance when it comes to workplace relations.

I commend this bill to the House.

Lisa Chesters (Bendigo, Australian Labor Party) Share this | Link to this | Hansard source

Prior to entering this House I was an organiser for United Voice, a low-paid workers union that represents cleaners, security guards, early childhood educators and paramedics. In that role I would be at shopping centres and in workplaces very early in the morning talking to cleaners and workers coming off night shifts and starting day shifts. In that role, very early one morning I met Jacki Petts, a cleaner in her 60s, who cleans not because it is a job of choice but because she needs to pay the bills. I can remember talking to Jacki one morning—she had just started work, and she and all of her colleagues had been handed a two-page paper, all of them identical. It was a Spotless Cleaning individual flexibility agreement. In this two-page paper were a number of boxes that had already been ticked. The paper talked about Jacki being paid in accordance with the award—that is good—but then it went on to say that she would forgo her overtime rates, that she would forgo her rostered days off and that she would forgo her penalty rates. And her employer, Spotless Cleaning, had been so kind as to pre-tick these boxes for her and for all of her employees. It really goes to the heart of how individual, how flexible, these agreements are. Jacki, being a little aware of her rights at work, said that she would not sign the agreement. Instantly, her supervisor said to her that she would lose her valuable Sunday shift, meaning that she would be $200 worse off in her pay each week. And that is exactly what happened to Jacki.

At the time, Jacki said that she just cannot survive—it means a lot to her, and she cannot afford to pay her mortgage and the bills that she has coming in time and time again. Jacki's husband passed away a few years before, and the only way she could survive in her changed circumstances was by having her daughter move in. This is the reality of IFAs: they undercut basic working conditions. If a full-time cleaner working five days a week works a sixth day they usually get penalty rates—double time. But under this flexibility contract, there were no overtime payments, so Jackie would have lost that extra money.

The fact is that the Spotless Cleaning workers who signed this agreement were disadvantaged by this IFA, which about 200 employees had signed. These IFAs did breach the Fair Work Act. However, what saved their penalty rates, what saved their overtime rates and their rostered days off, was a key reform in Labor's Fair Work Act—a key safeguard in relation to the individual flexibility agreements. It was part of the better-off-overall test to ensure that if somebody signed an IFA they would not be trading off basic conditions like penalty rates. Labor's Fair Work Act ensured that Jacki would not lose her penalty rates. And when it was tested in court, when Jacki stood up and said, 'I believe that I have been disadvantaged, and this IFA they have tried to make me sign would undercut my basic conditions', the Federal Court upheld and said that Jackie was right. The penalty rates not just for the cleaners like Jacki but for the entire Spotless Cleaning workforce were saved because of Labor's better-off-overall test.

That is what this bill today seeks to take away. It seeks to take away simple words that ensure that so many cleaners are not forced into IFAs. I single out Spotless because they were a company that tried to challenge the fair work laws. That is what some companies do—not all companies; some employers do the right thing. But then there are other companies that try to seek an advantage in an industry where labour costs are so important. They test the barriers of our industrial relations system and try to undercut their competitors. That is exactly what Spotless tried to do with their retail shopping centre cleaners, but Labor's Fair Work Act stopped them. What we are seeing now is this government is that they are trying to reintroduce one of the worst elements of WorkChoices: bringing back individual contracts. In many ways it is a backdoor attempt to reintroduce an element of WorkChoices that disadvantaged so many. This bill will enable employees to undercut the basic entitlements, a move that even John Howard admits was a mistake under WorkChoices. Due to the pressure and due to meeting people every day who had lost basic conditions, John Howard reinstated the no-disadvantage test in 2007. Even on the other side of politics, there was an acknowledgement that, if individual flexibility agreements go after penalty rates, businesses and companies will use them to cut take-home pay.

I do not believe that members of the government actually understand how this bill will re-introduce the worse aspect of WorkChoices in relation to individual contracts. It will allow employers once again to test the boundaries, to do what some of them have been calling out to do publicly and privately, and that is to cut basic conditions like penalty rates, night rates and overtime rates.

This bill goes much further than the coalition's pre-election policy and the Fair Work Act Review panel's recommendations. It is another example of a broken promise by this government to the Australian people. Penalty rates are important to so many people, and to the people in Bendigo, who rely on them. According to polling conducted by Essential Research, 80 per cent of Australians believe that people who work nights and weekends should be paid more. Nationally, 4.5 million Australians working in sectors where penalty rates apply need them to survive.

For Bendigo workers, weekend and overnight rates are more than just compensation for lost time with family. Penalty rates put food on the table, put petrol in the car and are vital to ensure that workers survive. In this debate, it is so important that we consider the workers who are at the frontline of these attacks and their words cannot be ignored. Take for example Alan Butler, who is an employee with Tip Top Bakery in Bendigo. He has been with the company for about 20 years and understands the importance of weekend and night overtime rates to employees he works with and their families. He states that he works on Saturdays and, if he lost his pay for Saturdays, he would be down about $160 a week. That is a significant amount for anybody—that is petrol and food money gone. If his company were to introduce a flexibility agreement, he could be trading off basic rights.

Everybody relies on this extra pay, especially those with families. Alan says some of the guys working on afternoon shift would lose twice that amount. In an average year for those blokes they could be up to $16,000 out of pocket. That is exactly what will happen if Tip Top Bakery try to introduce the flexibility agreement that Spotless tried to introduce to the cleaning side. The Spotless flexibility agreement, should the bill be passed, will be upheld. It will be illegal to introduce the flexibility agreement that Spotless tried to work out for the cleaners in retail shopping centres. Therefore if Spotless could to it, Tip Top could do it.

Let us also take the case of Adam Foster, a Wilson Security guard who works at Puckapunyal army base. This is not a security guard in a minimum-security site; this is a security guard making sure that our defence bases are secure. Adam has had to step away from working weekends and nights because of changes in this family circumstances. He already knows what it is to live without penalty rates. His basic fortnightly pay has dropped from $1,800 to $1,475. He says it has made his household budget tough. Once you realise how much it costs losing penalty rates, you realise how tough life is for all of us who are destined to be on the minimum wage, how hard it would be for many working Australians.

Let us look at the paramedics. Brett is a paramedic working in Bendigo. He too relies on penalty rates. His base rate, if penalty rates were gone from his take-home pay, would be $56,000 a year. Penalty payments lift his penalty rate up to $71,000. That is a 26 per cent increase on the base rate. Brett argues that he believes that without penalty rates he would struggle to put food on the table. It is not for the luxuries; it is so you get by every week. You can pay the mortgage, you can pay for the kids' sport, you can make sure there is food on the table. He would argue that, if penalty rates were lost from his area, a number of people would exit the ambos very quickly. What crisis would our health system be in if ambos left and basic conditions like penalty rates were cut?

Australians need access to information and support at work. The previous speaker mentioned the importance of changing right of entry to keep those big bad union officials out of work places. But let me put another situation to the House by going back to the example of our Spotless cleaners. It was lucky that Jackie was a member of the union. As soon as she had the IFA in front of her she said, 'Hang on, this isn't right. I'm going to call my union to ask if it's okay'. If Jackie was not a member of a union or if she was a non-English speaker, if she was a Hindi-speaking cleaner—there are lots in the cleaning industry—who was not quite sure whether the agreements which were put in front of her was right, under this bill she would first have to know that a union existed. The union could not turn up and talk to people about what their rights were. Under this bill she would then be prepared to be identified as the employee who has invited the union out to the workplace. She would then have to be prepared to resist the employer's questions: 'So why did you ask the union out? Why do you need to speak to the union?' She would need to find the courage to answer these questions and then talk to the union representative when they arrived.

We all know in the real world that if a cleaner is placed in that situation—where they are not sure about an agreement that has been put in front of them and where they are told that if they do not sign it they will lose their shifts and they will lose their penalty rates—and if she does not have access or the opportunity to speak to somebody about her rights at work, then she will probably sign that agreement and lose her take-home pay. In the real world, there is such a thing in these cleaning rooms and in these tea rooms as take it or leave it.

Meanwhile, higher-paid Australians who are already on a collective agreement will have ongoing access to the union. All Australian workers deserve the same rights. They deserve the same access to the union, regardless of where they work, how much they get paid and whether they are on an enterprise agreement or not. Yes, Spotless did not like me talking to their cleaners. They did not like me talking to their cleaners because they knew that their individual flexibility agreement was dodgy. I have always maintained that if employers and companies are doing the right thing, then they have nothing to fear. In the majority of my experience as a union official, there were no issues, because the majority of employers do do the right thing. But then you have got the one who tries to undercut their competitors, roll-out dodgy agreements and test the barriers. It is why it is so important that we have an IR system that is robust and ensures fairness in our workplaces.

This bill is also bad for business. For all the cleaning companies doing the right thing, they faced being undercut by Spotless who was doing the wrong thing. I am sure that if this bill gets up and passes through the Senate, we will see Spotless trying to undercut their competitors again. That will place their competitors—the cleaning companies doing the right thing by their employees—in a tough situation: either cut their own cleaners' pay or lose the contract. We will create a very insecure environment in the service sector. This bill is bad for Australian workers and it is bad for their families. This bill stands to be another broken promise by the Prime Minister. That is why I support the O'Connor amendments to this bill and encourage all members of the House to do exactly the same.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

The 2007 federal election, at which I was elected for the first time, had a big focus on industrial relations. If you listen to the Labor Party, it was the union campaign against Work Choices that won it for them. In the year of Kevin 07, a major part of the debate at that election was about industrial relations.

Deputy Speaker, you might not recall my maiden speech, because you were not here in the chamber at the time, but I did reveal at that particular time that I had a family history of union membership. I must admit, I had been a member of a union at one stage in my life. I had no choice. I was forced into it by the gas and fuel department in Victoria; as workers in that department, we had no choice; we had to be members of the union. As I said, I had a family history of union membership. My uncle was the secretary of the Federated Ship Painters and Dockers Union in Melbourne It is a prime example of a good, operating union that worked in the interests of the union leaders and certainly not their workers. That is for sure, as we saw from the bottom-of-the-harbour royal commission many years ago. But these are some of the things you have to bear as family—you cannot choose your family, can you?

Industrial relations certainly did not win the election for Labor in the west, as the Liberals won two seats off Labor; one of them being my own seat of Swan and the other being the seat of Cowan. There are many reasons that the people of Western Australia have for a long period of time been concerned about the Labor Party's industrial relations policies in our state. Even this year, the WA Labor Party continues to give them these reasons and so we saw the Liberal Party once again come to the fore in the recent WA Senate election and dismal result of the Labor Party in Western Australia.

There are two things that help us understand why this is the case. The first is the history of union militancy in the state. It was interesting that the minister mentioned in his speech the recent case featuring CFMEU national president Joe McDonald and cited it as a need for these reforms. He forgot to leave Joe's old mate, Kevin Reynolds, out of the picture, but he should be included. Joe McDonald and Kevin Reynolds were like Siamese twins and they spent many years terrorising good, honest employers and businesses via the industrial relations platform in Western Australia. The minister told the House about a recent incident where the CFMEU was fined $193,600 after ignoring the request of an industrial relations consultant to leave a site owned by CITIC Pacific's Sino Iron Ore in Western Australia. Mr Pyne said that when Mr McDonald was asked by a consultant to leave the site, because he did not have a right-of-entry permit, Mr McDonald replied:

I haven’t had one for seven years and that hasn’t f***ing stopped me.

That is typical of the attitude of unions in Western Australia.

Seven years ago, it was Mr McDonald, a unionist known in Western Australia for his militancy, who famously declared, 'We are coming back. As the polls predicted, it's a Rudd victory.' It was also Mr Kevin Reynolds, at a function I attended, who said that Kevin Rudd would sell his grandmother to win the election. Kevin Reynolds gave us a true picture of Mr Rudd at that particular time before the 2007 election.

Terri Butler (Griffith, Australian Labor Party) Share this | Link to this | Hansard source

As if Tony Abbott would have said anything different!

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

It is true, he would have sold his grandmother to win the election. But do not worry, in Western Australia we have got a good antenna for crap; we saw it and we stopped him at the border. Anyway, at the time Mr Rudd said that he was not coming back and made a whole series of commitments on industrial relations to prevent the sort of militancy that Mr McDonald and the unions in Western Australia have become notorious for.

But as we heard in the minister's speech, these undertakings were never honoured and never implemented. As the quote suggests, Mr McDonald, Mr Reynolds and their friends have been able to run amok for the last seven years in Western Australia. So it is now up to the coalition to implement these commitments made by the Labor Party in 2007 and get some control back over our industrial relations policy, returning it to the sensible centre.

That is what this bill, the Fair Work Amendment Bill 2014, seeks to achieve. In essence, it seeks to implement the commitments made by the Labor Party in 2007 that they never honoured. The second aspect we have to consider, when considering the view of the people Western Australia on this matter, is the fact that the Labor Party and the unions are the same thing. To be a member of the Labor Party, you have to be a member of a union. So, when the people of Western Australia's see union militancy, they know that these unionists are members of the Labor Party and will ultimately do deals to parachute themselves into parliament.

The recent Senate election has shone a big light on these practices. Before the WA Senate election, I called the Labor Party out on this in the Federation Chamber, where I spoke about the reports of intricate deals between Labor unions in WA to decide who got the Labor Senate seats in that election. And I was not the only one to warn of this. According to TheWest Australian on 24 April, Senator Mark Bishop early last year produced a report entitled The Senate in WA—a worrying prospect. But, apparently, despite compiling this 10-page report, Senator Bishop never gave it to the Labor executive, so perhaps his warning did not get through either.

The result of these deals seems to have been the selection of United Voice's Senator Sue Lines, who, according to an article by Paul Murray in The West Australian on 16 March 2013, had not lived in WA for eight years, and of the shoppies' Senator-elect Joe Bullock, who was reported as saying Labor members were 'mad'. It is interesting that the new electoral laws proposed by the joint standing committee have made some points about potentially restricting candidates who do not reside in the state they are standing for election in. The key result of the Western Australian Senate election in April was that Labor's vote collapsed to its lowest rate on record, 21 per cent—

Sharon Bird (Cunningham, Australian Labor Party, Shadow Minister for Vocational Education) Share this | Link to this | Hansard source

What bill are we debating!

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

with the return of only one out of six senators, Mr Bullock. I will have more to say on the WA Senate election result at a later date, when a fuller opportunity arises in the House. But I raise it to make the point that the people of Western Australia are sick of the industrial militancy of unions in Western Australia and the fact that unions control the candidates of the Western Australian Labor Party, who then of course do nothing to rein in the industrial militancy. It is a model that the WA people are sick of, and I suggest that members opposite go and read some of those writings of Senator Mark Bishop on this subject. WA's economy is held back and disrupted by the unions and the Labor Party.

Having set the scene with the views of the people of Western Australia on this subject, I now turn to the provisions in the bill.

Sharon Bird (Cunningham, Australian Labor Party, Shadow Minister for Vocational Education) Share this | Link to this | Hansard source

Yay!

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

I hear some cheering from the opposition. They do not like having the spotlight put on them, do they! Let us first consider the right-of-entry provisions that have got Mr McDonald into trouble so many times. We have heard a lot about promise-keeping this week, and let us remember that before the 2007 election—an election featuring debate about industrial relations—both Kevin Rudd and Julia Gillard promised that there would be no changes to union right-of-entry laws under a Labor government. These were commitments that eerily parallel the one made in the 2010 election campaign by Ms Gillard about the central issue of carbon taxation. Of course, the central assertions of Mr Rudd and Ms Gillard in 2007 did not come to fruition. The Fair Work Act was introduced by Ms Gillard and in fact greatly expanded the right-of-entry rules for discussion—expansions which have been exploited by the union bosses in WA. This exploitation has been further exacerbated by rival unions visiting the same sites multiple times as they compete for members.

It was the previous government's own Fair Work Act review panel, commissioned by the now opposition leader in 2012, that detailed how a number of Western Australia projects had become the target of right-of-entry abuse by unions. In particular, the panel noted the situation at the Pluto LNG project, which received over 200 right-of-entry visits in three months, and at BHP's Worsley Alumina plant, which received 676 right-of-entry visits in just one year—676. That is more than one a day. That is two a day, including weekends. Haven't they got anything else to do—just right of entry?

Ms Butler interjecting—

We hear the opposition again standing up and protecting the militant unions in Western Australia.

Terri Butler (Griffith, Australian Labor Party) Share this | Link to this | Hansard source

Because right of entry saves lives.

Steve Irons (Swan, Liberal Party) Share this | Link to this | Hansard source

This bill will remove the capacity for union officials to harass and disrupt businesses, by restricting eligibility for right of entry for discussion. As the minister stated:

A union will only be entitled to enter a workplace for discussion purposes if:

1. they are covered by an enterprise agreement, or

2. they have been invited by a member or employee they are entitled to represent.

The amendments in this bill allow for the Fair Work Commission to take into account the combined impact of visits by all unions to the workplace—a provision aimed at tackling the interruptions caused by excessive visits by multiple unions to a single workplace as they attempt to attract members.

More recent amendments to the Fair Work Act in 2013 by the previous government further increased the burden on employers by requiring them to pay the cost of transport and accommodation of union officials to remote sites, including to offshore projects. The bill will repeal this unnecessary burden and reinstate the previous approach, where union employees were responsible for travel and accommodation costs. That is particularly relevant in a big state like Western Australia, where travel to the north and to a lot of construction sites has an enormous cost. It is unfair that employers should have to pay for people to come to the site who are coming there not to assist the employer but to disrupt them.

Greenfields agreements can be vital to the commencement of major projects, and this bill will ensure that good-faith bargaining requirements are extended to the negotiation of greenfields agreements. The extension of good-faith bargaining requirements will curtail the ability of unions to demand inflated wages and end the effective veto power on agreements that unions have enjoyed since the introduction of the Fair Work Act in 2009. The previous government's fair work review panel noted that, under the current laws, union actions 'potentially threaten future investment in major projects in Australia'. Since 2009, the decline in standards of bargaining conduct and the disruptive tactics employed by unions have delayed the development of major resource projects. These actions deprive the Australian economy of investment and much-needed job creation. Amendments to the greenfields provisions will send a strong message to overseas investors that Australia is once again open for business.

This bill will also remedy the strike first, talk later loophole that emerged under the Fair Work Act—a loophole that Labor never sought to address, despite Kevin Rudd promising prior to the 2007 election that employees 'will not be able to strike unless there has been genuine good faith bargaining'. Working hours lost under the last six years of Labor government peaked in 2012 at 273,200 hours, highlighting the militant approach to the bargaining process employed by unions which was shamefully ignored by Labor.

The effects of unnecessary industrial action are widespread. The recent teachers' strike in Western Australia, a pre-election stunt attended by the opposition leader, did nothing to advance the cause of teachers within the state. Instead, it closed 102 schools for the day, depriving thousands of students—a number of whom reside in my electorate—of an entire day of learning. The presence of the opposition leader at this strike only further demonstrated Labor's acceptance of militant unionism and unnecessary industrial action, despite their negative impact on productivity, the community and the economy. By closing the loophole, the coalition government is taking steps to ensure that a balanced, harmonious and respectful approach is taken to enterprise bargaining.

Further measures in this bill we are discussing will work to provide clarity and certainty to employees around the use of individual flexibility arrangements and implement a number of the recommendations made by the Fair Work review panel that were overlooked by the previous government and the Leader of the Opposition, who was the Minister for Employment and Workplace Relations at the time.

I am about to wrap up—and I am sure the new member for Griffith will be happy about that—but, first, I just want to go back to when I was working as an apprentice electrician and met a union shop steward on a building site in Bayswater, Victoria. He came in and asked to see my ticket. I did not have a ticket because apprentices do not have to have a ticket, but he insisted. He wanted to shut the site down. He was red-haired and Scottish, which is highly unusual for a shop steward in Victoria—or anywhere in Australia! He abused me for about 10 minutes because I was not a member of the union. He went to walk off after threatening to close the site down and I informed him that I was an apprentice. That took the wind out of his sails. He was very deflated because he was not able to shut the site down for having someone on the site without a union card. These were the types of tactics we saw back in the 1970s and they are still happening on sites in Western Australia. If you speak to any subcontractors or builders in Western Australia they will tell you that these threatening tactics of the unions are still operating. They are lawless. They are unfair to the people who actually provide the jobs for workers in Western Australia.

This bill will allow employees fair and equitable representation by a union without disadvantaging the employers who create jobs and strengthen our economy. Employers will be able to run their businesses without excessive and unnecessary union interruption. I commend the bill to the House.

Terri Butler (Griffith, Australian Labor Party) Share this | Link to this | Hansard source

It is a pleasure to be here and to rise to oppose the bill today. I was very interested to hear the previous speaker refer to 'inflated wages' because that really betrayed, for everyone to hear, the coalition's agenda when it comes to industrial relations laws. They have been after mechanisms to lower everyone's wages for a very, very long time.

I would like to the remind the House what happened back in 1993. It was a very important year for a range of reasons. Weezer's Blue album had been released. You might be too young to remember that, Deputy Speaker Vasta. It was a great album. Twenty years later Weezer did an anniversary tour of the Blue album. It was great. Unfortunately, 20 years later the coalition are still singing the same song about industrial relations that they were singing back in 1993 as well, which is much less pleasing to the ear, unfortunately.

Back in 1993 what was happening in industrial relations is that Paul Keating's visionary government was changing the way that industrial relations was conducted in this country. He brought about reforms where we could see workers and employers negotiating together on pay and conditions in the workplace. These enterprise bargaining reforms were important for our economy here in Australia.

At the same time, what was the coalition doing? John Howard and John Hewson were shopping around Fightback! What was part of the approach of Fightback! to the Australian economy? It was lowering wages. John Howard's agenda was to lower wages. I think it is uncontroversial to say that. Fightback! was so intent on lowering wages that it included a policy whereby young people would get $3 or $4 an hour for work. Clearly there was an agenda back then to lower wages.

I draw the House's attention to some comments made at the time by Professor John Buchanan, who talked about the move to lower paid jobs through the policy settings in Fightback! He said:

Low wages are often associated with low skill jobs. A vicious cycle can develop where low wages subsidise inefficient, low productivity jobs giving management no incentive to increase competition on the basis of quality and overall firm level productivity. Some of the most troubling analysis of the UK experience indicates that this could be one of the lasting legacies of the Conservatives' rule.

It is no less the case here in Australia.

Labor, on the other hand, do not share the coalition's low-wage agenda. We do not want to be in a race to the bottom. We want to have good jobs and decent wages here in Australia for all Australian workers. That is why the right balance was struck in 1993 with enterprise bargaining.

A few short years later as I left high school and voted for the first time in 1996 my vote was not enough to elect a Labor government. That was unfortunate for this country because instead we got a Howard coalition government. The Hon. John Howard, the former Prime Minister, had had an agenda for a very long time to lower wages in this country. He thought he finally had his opportunity. At that time the then Prime Minister wanted to introduce individual agreements that would allow for pay and conditions to be stripped away, undercutting of award conditions, undercutting of collective agreement conditions and lower wages for Australian workers. At the time, because he did not have control of the Senate, he was forced to make some compromises. So he did not get his full agenda up at that time. Instead, he introduced AWAs, Australian workplace agreements. It was a funny name for things that were basically imposed on working people. There was very little 'agreed' about them. But, nonetheless, that was the name they were given. AWAs were agreements in name but not in reality whereby employers could impose lower wages and conditions on working people. But there was what was called a no-disadvantage test. That was administered through an independent tribunal.

That did not quench the thirst of the former Prime Minister and the coalition for lower wages. You will recall that in 2005 the coalition gained control of the Senate. What did we see?

We saw Work Choices. Work Choices took effect in March 2006 and had a clear agenda of lowering wages. It was radical workplace law. I have with me an article from the time by Misha Schubert, a journalist, who described it as 'Howard's workplace revolution'. The lead was:

Millions of Australians will face new conditions of employment as the Prime Minister realises his vision for radical industrial relations reform.

And radical it was. We are talking about laws that changed the face of industrial relations here in this country to take away people's rights to bargain collectively for good, decent and fair wages and to allow the low-wage agenda to be imposed on people through the mechanism of individual agreements. Individual agreements were the most radical component of those Work Choices laws. There is an old saying—and I am sure you have heard of it, Mr Deputy Speaker—'divide and conquer'. That is what individual agreements are for. Those new individual agreements—which are still called AWAs, even though there was nothing really much about them that relied on agreement—did not have the no-disadvantage test, because Mr Howard had never wanted the no-disadvantage test. The coalition had never wanted the no-disadvantage test. They wanted an imaginary world where an employee had equal bargaining power with an employer and could freely negotiate his or her own conditions, without having any safety nets, without having any award system or collective agreements behind them. But, unfortunately for the coalition and fortunately for the Australian people, people were not fooled by the Howard government agenda on Work Choices. People stood up and spoke out.

When we saw situations where people were offered 'take it or leave it' individual so-called agreements that lowered their pay, that lowered their conditions, people fought back—and it was a real fight back, not a John Hewson 1993 Fightback!— through the Your Rights at Work campaign, and it is easy to see why. Those AWAs made under Work Choices made people worse off. It is the same agenda today—the agenda to lower wages, to get rid of penalty rates, to strip away conditions. There was research done and analysis produced from documents released by the coalition government. This research showed that 63 per cent of those AWAs abolished penalty rates; 64 per cent axed leave loadings; 51 per cent cut overtime pay; 46 per cent cut holiday pay; 40 per cent reduced rest breaks; 52 per cent abolished shiftwork loadings; one in six dropped all award conditions, leaving only the five minimum; and one in five provided no pay increase for the life of the agreement, which could last up to five years. So you can see that Mr Howard had got his way. He got his radical industrial relations reforms that would push down wages for a lower wage economy. That is the low road; it is not the high road.

Labor believes in the high road. We want good jobs, with decent wages and conditions. That is why there was such a strong call from Labor at the time to get rid of Work Choices and that is why there was such a strong call from the working people of this nation to get rid of Work Choices. It forced Mr Abbott to refer to Work Choices as 'dead, buried and cremated' in subsequent years. Unfortunately, we are seeing in the bill that we are discussing today clear evidence that those words were inaccurate. Unfortunately, Work Choices is not dead, buried and cremated. What is happening here is that the coalition has learned not to be upfront with the Australian people about their low-wage agenda. The coalition is trying to do this by stealth, and so you are seeing the changes to what are known as individual flexibility agreements being brought about by this bill. This is part of the reason why I am opposing it.

The coalition has never really wanted employees to be able to bargain for their conditions. If you want proof of that, look at the employer greenfields agreements under Work Choices. Never has a document been so misnamed as an 'employer greenfields agreement'. Never before has the law recognised an agreement with oneself, which is what the employer greenfields agreement was. You were talking about a situation where, before a project started, the employer called a meeting with itself. The meeting went something like this: 'Hello, employer. I would like to make an agreement with myself. Certainly, employer. What are your terms? They are these. Let's sign it, then.' It is an agreement with oneself. It was effectively the employer being table to dictate to the new employees what the conditions would be. That was an employer greenfields agreement. This is the coalition's agenda. It is to allow employers to lower wages and place downward pressure on wages. This is not something that Labor will ever stand for, and this is why, as I say, I am so disappointed to see the changes to individual flexibility agreements that are being brought forward through this bill.

Individual flexibility agreements are something that were brought in for genuine flexibility—the flexibility needed to be able to make agreements to go and pick up your kids from school or to discharge caring responsibilities towards an elderly parent or relative. But the changes that are being brought about in this bill will allow individual flexibility agreements to be used to change and alter pay and conditions. We are seeing an attempt to characterise this as the implementation of a recommendation from the Fair Work review panel. But, of course, as my colleague the shadow minister for employment and workplace relations said today in addressing this bill: 'Under the guise of implementing a recommendation of the Fair Work review expert panel, the government is unreasonably proposing that a key safeguard be abandoned when it comes to what can be traded away through an individual flexibility agreement.' The relevant recommendation was that you could trade away money benefits under an agreement for non-money benefits under an individual flexibility agreement. But what the expert panel recommended was that the money that you were trading away had to be relatively insignificant and that the benefit, the non-money benefit, had to be proportionate. Those words, unfortunately, do not appear in the bill. They are not included. Those safeguards are not included. So this is not the implementation of a recommendation from the review panel but something more sinister.

There is a no-disadvantage test in the bill. But what is included in this bill is an attempt to circumvent that no-disadvantage test, to make it basically meaningless by a couple of means. Firstly, there is the ability to trade off money and conditions for non-money benefits, without the safeguards that the money you are trading off has to be relatively insignificant and that the non-money benefit has to be proportionate. The second thing that is being done to help unscrupulous employers—most employers are not, but unfortunately some are in my experience—is imposing difficulties for employees to prove that the agreement is unfair. There is a new requirement that the employee will have to say in the individual flexibility agreement that they believe that it is fair and meets that test. Unfortunately, that assumes that the employee lives in a world where they have as much power as their boss. It is just not my experience. If you are a cleaner and your boss calls you in, hands you an agreement and says, 'If you want those extra shifts, this is the agreement you have to sign,' you may not have the English language skills to clearly understand the effect of what you are signing and, even if you do, you are not going to have any practical choice. You do not have the power to have any practical choice.

When they can circumvent no-disadvantage test and when there are no safeguards in place of the sort that ought to be included to implement the expert panel recommendation that is when people can, for practical purposes, be forced into these individual agreements. As we have already seen, they can cut money benefits and conditions in return for non-money benefits that do not have to be proportionate—and they can be significant money benefits that are cut and traded away in these agreements. I oppose this bill. I thank you, Mr Deputy Speaker, for the indulgence.

Angus Taylor (Hume, Liberal Party) Share this | Link to this | Hansard source

I rise to speak in support of the Fair Work Amendment Bill 2014. In doing so I speak in support of our government making good on its election commitments with respect to industrial relations. Our election promises and, indeed, this bill are about returning the pendulum to the sensible centre. It will give flexibility and choice to employees wanting to depart from rigid employment conditions which do not suit them. It will encourage investment in our construction and resources sectors, not least the housing construction sector, which will be critical to our economy in the coming years. The bill will promote better, more productive workplace bargaining.

More than ever Australian workplaces—and when I use that term I am referring to both employees and employers—need this parliament's assistance in meeting the challenges they face in the 21st century. This assistance cannot and must not come in the form of onerous new regulations and restrictions. It must come by liberating employers and employees from the things that hold them back. Employers need to be able to get on with doing what they do—innovating, growing and making money. More than ever employees need and want flexibility and choice and they want to be in charge of their own destinies. Both sides of politics have been talking in these generic terms for some time now, but this is not flaky rhetoric. These amendments come at a time when our old industries are being torn apart by intensifying global competition and rapidly changing domestic markets.

In 2014 many of the businesses in the retail sector in my electorate and more broadly across Australia compete globally, even in our most remote towns. The internet is revolutionising media, professional services, the public sector and now retail through online competitors. This was absolutely unimaginable 20 or 30 years ago. A century ago, when our industrial relations system was first developed, retailers were not even competing with others in the town next door or on the other side of the city. As we look forward, more and more of our service sectors will become globally tradeable and they will have to win against ferocious global competition.

Many think that the hollowing out of the main streets in our country towns and our cities is a temporary phenomenon or driven by a shift to the bigger centres. Whilst this is partly true, many years ago I saw the extraordinary uptake of country people to catalogue purchasing and this has translated now to online purchasing in even greater numbers. You only need to talk to any employee or franchisee of Australia Post to understand the pace at which local retail is suffering as a result of online purchasing. Retailers in main streets desperately need to adapt, and fast.

In the resources sector the cost of building a tonne of capacity in the Pilbara has gone from about $50 to $200 in the last decade. This has been driven by the rapidly increasing cost of capital projects in this country—half of which comes from wages. Disturbingly these costs have not escalated to the same extent in our competitor countries. We now face a situation where the costs of building iron ore capacity are 25 per cent to 70 per cent lower in competitor countries than Australia—and we start to wonder why we might be seeing the end of the mining construction boom. Meanwhile project delays have exploded. Australia now faces typical delays of over three years to develop a coalmine, as compared with 1.8 years in other countries, including places we might think of as basket cases. As a result, we are losing our share of global resources production. In a report I wrote four years ago I calculated that mining investment would fall this year in a worst-case scenario by about $10 billion based on the assumption that we would simply hold our share of new projects. In fact, the fall will be far greater—closer to $40 billion. We are now losing share of global resource projects rapidly, and our economy is starting to pay the price.

Our regulatory environment is stifling. Our project application process is way too slow and our expansions are too slow and too expensive. This might seem remote to many of our electorates, but mining investment has been creating job opportunities directly and indirectly across the whole country for many years. In the Quandialla pub I find workers who travel daily to the Cadia mine near Orange. The owner of the famous Tarago pub, The Loaded Dog, is a fly-in fly-out worker in the coal industry who uses his income from the mines to supplement the huge costs that were imposed on his pub business by the Labor government.

It is in this context, in this economic setting, that this bill seeks to help businesses and employees meet the challenges I have outlined. These amendments are not—I repeat, are not—about cutting wages or reducing benefits. Not one bit. But they are about increasing flexibility and enhancing productivity. It is worthwhile considering for a moment the political context within which these changes are proposed. We all know that the serious moves towards enhancing productivity in this country began in earnest—as we heard a moment ago—in the Hawke and Keating era. Bob Hawke and Paul Keating, of course, ran largely competent governments. They were both economically literate prime ministers and there was a high level of economic and industry literacy in their leadership teams—a stark contrast to the current Labor crop and their predecessors in the last six years.

Indeed in 1993, Paul Keating revealed his vision—as we heard a moment ago, as well—for workplaces of the future. There was historic bipartisan acceptance that it was often better for businesses and employees if they were free to bargain at the enterprise level. Labor's 1996 amendments went further, recognising that where there was a good safety net in place it made sense for employers and employees to be free to negotiate terms and conditions of employment without unions. In a stark departure from the past, collective contracts and individual workplace agreements became available without unions if that was what the parties wanted—more bipartisanship; more heading in the right direction. This was good stuff. It recognised that collective bargaining with unions in control of every line item of a contract for all employees across an industry did not make sense for many employment relationships.

Between 2005 and 2007, the coalition learned an important lesson—that in workplace relations, the most effective and lasting reforms are those that are undertaken carefully where solutions are addressing accepted problems. But then a truly, truly terrible thing happened. From 2007 until 2013, during the Rudd-Gillard-Rudd governments, and particularly of the last term of the Labor government, with 'Bolshevik Bill' directing the show as the relevant minister, we lost many of the gains. These were hard-fought, sensible, cautious gains that had been achieved largely by consensus for over a decade—consensus-driven gains for over a decade. In the Hawke-Keating era, the 2007 union wish list would have been seen off as ridiculous ambit claims. They would have been seen for what they were—harmful to businesses, employees and, ultimately, all Australians.

Union officials cannot fathom the concept of individuals having a say in their conditions, even in a collective framework, and even where the employee is better off. Prior to the 2007 election, employment minister Julia Gillard, incited by union officials, quite astonishingly promised to sweep away all individual agreements. However, removing individual flexibility was an unacceptable departure from the broader political consensus, so Labor changed tack under pressure and promised that their new collective enterprise bargaining would require a flexibility clause. In practice, that clause has failed. It has offered no real benefit to either employees or employers. It is not a genuine flexibility clause at all.

I am pleased to support the individual flexibility amendments in this bill. They enable employees and employers to genuinely agree on changes to awards or agreements so conditions of employment will meet their mutual needs. That is what Labor eventually promised the Australian people prior to the 2007 election, and it is what the unions made sure they could never deliver. I am genuinely pleased that there are many safeguards in this legislation for employees. I am delighted that this will help employees and employers in my electorate, particularly in the retail and services sector, conduct their lives and businesses as they see fit.

Here is one man who is passionate about small business: bakery owner Grant Pearce at Boorowa. He employs 26 staff, many of them casuals. But some of those staff want flexibility to work at times that suit them. However, he cannot afford to pay penalty rates to deliver what they want. It costs him double and a half at Easter and Christmas, yet these are his busiest trading days. We want to allow good people like Grant Pearce, the young people he employs, students and families to work around their busy commitments. Under these amendments, they will be able to trade wages for valuable extra annual leave, which is precious time for working couples who both work full time. These amendments will allow university students to work on days and at times that suit them so that they can hold their jobs and pass their courses.

I am also delighted about the amendments which will remove union veto powers over greenfield agreements. I have already referred to the impediments to getting major projects started in Australia. I am personally very interested in getting any and all projects off the ground, but it is our big projects that have sustained this country through the global financial crisis and beyond. We need them to stay and we need more of them. Under these amendments, investors in these projects will know that if they meet recalcitrant unions in the process there is an end point in sight. After a three-month negotiation, there is an opt-out provision which will enable the employer to take the proposed agreement to the Fair Work Commission for approval, where, I might add, it would then be necessary to apply the 'better off overall' test. There is no downside here for anyone—other than, perhaps, the union officials. There is no decline in standards. It simply enables projects to get up and running so that they can start turning profit, employing more people and generating income tax and royalties to build better roads, hospitals and schools. That is how it works. It is that simple.

Prior to the 2007 election, deputy opposition leader and employment minister Julia Gillard promised to leave the coalition's sensible and workable right-of-entry laws in place. That did not happen. Labor's retrograde amendments in this space have been abused by union officials in a way that was entirely foreseeable. To those who say that right of entry by business is not a productivity issue, tell that to BHP's Worsley Alumina plant, which had 676 visits by unions in a single year—almost two per day. And tell that to the Pluto LNG project, which saw 200 visits in three months—more than two a day. These kinds of unacceptable intrusions will stop or, at least, they will have an end date under the new laws. This is a very good and necessary thing if we want to maintain our share of global resource projects.

The Fair Work Amendment Bill is about sensible and measured reforms—essential reforms. It comes at a pivotal time: when new industry needs liberating; when capital costs need to come down; and when employers and employees seek flexibility, choice and the freedom to get on with it.

Debate interrupted.