Eric Abetz (Tasmania, Liberal Party, Minister for Fisheries, Forestry and Conservation) Share this | Hansard source

I thank honourable senators for their contributions to the Workplace Relations Amendment (A Stronger Safety Net) Bill 2007. I note especially the contributions of Senators Troeth, Barnett and Birmingham, who made very thoughtful presentations in this debate and whose contributions stand in unfortunate stark contrast to the ACTU sausage machine that we were exposed to from those on the other side. This bill provides a stronger safety net for Australian workers and their families—a safety net which effectively balances fairness with flexibility.

In summary, this bill establishes a fairness test to strengthen the existing bargaining safety net, even greater employee protections to ensure the legitimacy of the fairness test, and the Workplace Authority and the Workplace Ombudsman as independent statutory agencies. More than $370 million in additional funding will be provided to support these protections for Australian workers and to ensure that they are appropriately applied. Balancing fairness and flexibility is something that this government has done effectively for the past decade. It is a mix that has helped to deliver an unemployment level of 4.2 per cent, the lowest level since November 1974, and to get over 10.4 million Australian workers into work—more than at any other time in our history. Since the election of the Howard government, real wages have increased by 20.8 per cent and industrial disputes in 2007 are at their lowest levels since 1913, when records were first kept. Those statistics are the best measure of any concept of fairness.

The debate has shown there to be a number of misconceptions about the intent and effect of this bill. This bill sets out to strengthen the agreement making safety net for around 7.5 million of our fellow Australians. To ensure there is some clarity in this debate, let me take this opportunity to address the grossest misrepresentations that have been made. Accusations have been made—not surprisingly by Senator Marshall, our brother from the ETU—that the new fairness test is compromised by subjectivity. In addition, Senator Wong, the CFMEU delegate, argued—albeit wrongly—that the capacity to take into account the personal circumstances of employees will erode job security for those with caring responsibilities.

Firstly, the government rejects the insinuation that there is no objective basis for making decisions about fair compensation. Rather, the bill is clear. The first consideration will be the value of the monetary and non-monetary compensation provided under the agreement. Moreover, the bill is very clear about assessing non-monetary compensation. It must have a monetary value equivalent as well as significant value to the employee. As the standing committee heard in evidence, the capacity that the Workplace Authority has to consider the particular circumstances and preferences of employees is, in fact, a major strength and not a weakness of this bill. In other words, the preferences of the affected employees themselves are absolutely relevant to this exercise. If workers prefer particular arrangements and value these more highly than certain award entitlements, they should not be prevented from striking bargains that reflect their individual preferences. Importantly, such arrangements must meet the fairness test. This is a very important protection. For example, compensation in the form of a car space for a worker who does not have a car would not be deemed fair, despite unfortunate claims made in this place last night by Senator Brown—and she is the more sensible of the two senators who carry the name Senator Brown.

To claim such an arrangement would satisfy the fairness test disingenuously ignores the very clear wording of the legislation, which requires that non-monetary compensation have a significant value to the employee. Moreover, it is simply wrong to argue that the capacity to consider an employee’s individual circumstances will remove job security for carers. This bill recognises that workers with family responsibilities may want to negotiate flexible arrangements that allow them to combine employment with caring responsibilities—and the absence of such flexibility, if not otherwise available, would compromise their ability to remain in the workplace. This framework is not about one-size-fits-all arrangements, which are continually advocated by the union representatives opposite. One-size-fits-all arrangements threaten the job security of those who require their individual needs to be taken into account and reflected in their employment conditions.

It was also claimed that an employee’s personal circumstances will be subject to undue scrutiny by the Workplace Authority. An employee’s personal circumstances may be taken into account by the Workplace Authority in deciding whether fair compensation is being provided—and for no other reason. The test is deliberately drafted so that it is the value of the entitlements to the employee that counts. The Workplace Authority has no power to demand information. It is up to the employee, as they wish, to provide such information to satisfy the authority. This bill leaves it to employers and employees to reach agreement on working arrangements but subject to a fairness assessment by an independent authority. If an agreement fails the fairness test, it ceases to operate and the employer must make up any shortfall.

I can confirm that the government will move amendments to clarify that the employee is entitled to recover both the entitlements under the instrument that would have otherwise applied and any entitlements arising under any other applicable law, agreement or arrangement, including the Australian Fair Pay and Conditions Standard and the contract of employment. While these amounts would have been recoverable in any case, the amendments will put this issue beyond doubt.

There have been suggestions that the provision in the legislation for the Workplace Authority to consider matters such as the industry or economic situation of an employer will lead to a wave of substandard agreements. This is also wrong. The Workplace Authority will only consider matters such as the industry or economic situation of an employer where there are exceptional circumstances and where it is not contrary to the public interest to do so. This is not only similar to the old no disadvantage test but is actually a higher threshold to satisfy.

It has been suggested that the fairness test does not go far enough and that the salary cap for AWAs should be removed and the test should be applied to all agreements, including agreements made before the Prime Minister’s announcement in early May.