Joe Ludwig (Queensland, Australian Labor Party, Manager of Government Business in the Senate) Share this | Hansard source

There are no further speakers. I rise to sum up on the Fair Work Bill 2008. If a democracy is to mean anything, this debate on the Fair Work Bill 2008 can only be judged by how it answers this basic question: will the Senate respect the overwhelming call of the Australian people given to this parliament in November 2007? The Australian people voted for the balanced workplace relations policy set out clearly in the Forward with Fairness document. This bill delivers on each and every commitment in that policy. The bill finally removes the extreme Work Choices laws that were overwhelmingly rejected by the Australian people.

The bill creates a fair and simple workplace relations system that strikes the right balance between employers and employees. The bill will bring our workplace relations system back to the centre, where Australians clearly want it to be. Consistent with the government’s commitment to cooperative workplace relations, a thorough consultation process was undertaken to assist the government in developing the bill. This included providing the committee on industrial relations—comprising unions, employers and government representatives—a thorough opportunity to examine the draft bill in detail. The government considered all feedback received as a result of these extensive processes in the course of developing the Fair Work Bill.

The final stage of the consultation process for this legislation was the recently concluded Senate Standing Committee on Education, Employment and Workplace Relations inquiry. The government welcomes and supports the Senate inquiry process, which both complemented and completed the extensive consultations conducted in the development of the new laws. The government has carefully considered the Senate inquiry committee report, as well as each of the 154 detailed submissions to the committee’s inquiry.

The government has consistently indicated its willingness to consider technical amendments that are consistent with the policy that would improve the operations of the Fair Work Bill. As senators are aware, the government has recently announced its intention to make a number of technical amendments to that bill that improve the operation of the new system. The government’s amendments will improve the operation of the new system by removing uncertainty and unintended consequences while ensuring consistency with the policy mandate given to the government to implement Forward with Fairness.

However, let me state this very clearly: we are committed to implementing the Forward with Fairness policy, which was approved by the Australian people at the last election. We are not prepared to bargain away the will of the Australian people. No one stakeholder group—employer or employee—will be 100 per cent satisfied with every provision in the bill, but the government’s aim from the beginning has been to get the balance right on workplace relations. We need a stable, balanced and truly national system to meet the needs of the country in the decades to come.

I will now turn to the debate that was had over the past two days. Senators have debated the bill, obviously vigorously, and, while there has been much debate of a rhetorical nature, a few matters of concern have been identified. However, some of the claims made in the debate are quite frankly without substance or are plainly misleading and I cannot let them stand unchallenged on the public record.

One of those claims—we will call it claim 1—is that the Fair Work Bill will increase unemployment. I will first respond to claims that the Fair Work Bill will endanger job creation. There are a variety of factors that affect employment levels in our economy, but what the government is saying very clearly is that we are not immune from the global financial crisis and everything we have done has been intended to keep this nation in front and to protect jobs. But one of the things we also need to do is ensure that we do not leave employers and employees in legislative limbo and uncertainty about what the workplace relations laws of this country will be. In these difficult times we should be delivering certainty, stability, productivity and flexibility, and that is what this bill does.

Employees need to have confidence that their pay and conditions are secure, and this bill guarantees just that. The Fair Work Bill sets out a fair and balanced system that is designed to meet the country’s needs both in the good and the bad times. Businesses and employees need a fair and effective enterprise bargaining system and the support of Fair Work Australia to help them negotiate creative and flexible arrangements that can help business through the difficult times ahead so that the employees can keep their jobs. During these difficult times Australian families need to know that their basic workplace rights are secure and certain. They need the security and protection against unfair dismissal, they need a fair safety net of basic wages and employment conditions that cannot be stripped away and, if the worst happens, they need redundancy pay to tide them over. The government does not believe that providing a fair safety net for employees with basic minimum standards like redundancy pay, public holidays, rest breaks and penalty rates for weekend work will result in increased unemployment. Employers make decisions to hire employees based on a range of reasons related to the needs of sustaining and growing their businesses. This will not change under the new system.

Turning now to claim 2, which is that unfair dismissal laws cost jobs. The employment related concerns about providing proper protection against unfair dismissals are not supported by the empirical research in this area. For example, the OECD has found that there is no clear link between stricter employment protection legislation, including unfair dismissals, and employment.

We make the shape of our new unfair dismissal system crystal clear in Forward with Fairness and we believe that it strikes the right balance between providing an avenue for unfair dismissal claims and certainty to business on potential claims arising from dismissal. Requiring employees, before being able to claim unfair dismissal, to serve the minimum qualifying period of six months for large businesses and a full 12 months for small businesses balances the right of employees to have protection from unfair dismissal with the need for employers to have an adequate opportunity to determine whether or not an employee is suited to their job and to the employer’s business. Additional special arrangements will apply for small businesses, including the Small Business Fair Dismissal Code. Small business employers will be fully supported under the Fair Work Bill to make reasonable and fair decisions in managing their employees. And we make it clear in Forward with Fairness that the small business arrangements will apply to businesses with fewer than 15 employees. Senators should note that Forward with Fairness did not define a small business as 20, 25 or 50 employees. Under the Fair Work Bill good employees who have proved themselves under a full six or 12 months of service will have the right to challenge a dismissal that is harsh, unjust or unreasonable.

Looking now at claim 3, which concerns the Fair Work Bill and compulsory arbitration. Compulsory arbitration is not a feature of the new system—far from it. The focus of the new system is to encourage employees and employers to bargain in good faith and reach agreement voluntarily. This is the way that most bargaining takes place, quite frankly. Employers and unions must bargain in good faith and this means that they must meet, exchange positions and refrain from capricious or unfair conduct. But good faith bargaining does not require either side to make concessions or to make an agreement. The new system is not about delivering access to arbitration at any time that parties get into a disagreement during the bargaining process—far from it. Parties can take a tough stance in negotiations.

Workplace determinations can only be made in limited and clearly defined circumstances: for example, when industrial action is causing significant harm to the national economy or threatening the health and safety of the community; or where a protracted dispute is causing significant economic harm to the bargaining participants; or in the low-paid bargaining stream, subject to very strict criteria; or where a party has engaged in serious and sustained breaches of good faith bargaining requirements and is, quite frankly, flouting the law.

We know that numerous studies show that collective agreement making is good for business and good for employees. Bargaining allows employers and employees to examine ways to improve productivity and efficiency and make workplaces more flexible. This encourages growth in real wages and living standards through bargaining underpinned by real labour productivity growth, which of course helps to control inflation. Work Choices coincides with a poor productivity performance. Annual productivity growth averaged only 1.2 per cent between March 2006 and September 2007, compared with the annual average over the previous two decades of 2.3 per cent. This bill delivers to the Australian people what we promised them: fair bargaining and a productive workforce.

Another claim made during the debate on this bill was that low-pay bargaining will drive up costs for employers. We will keep tabs on that, claim 4. There is a clear commitment in Forward with Fairness to help low-paid employees and their employers to gain access to enterprise bargaining and the benefits it brings. We want to allow as many Australian employees and employers as possible to receive the benefits of enterprise bargaining. We know that there are people who have been left behind in sectors like cleaning, community work and security. Fair Work Australia will be able to convene conferences, help identify productivity improvements to underpin an agreement and generally guide parties through the negotiating process. This process is not about building another safety net on top of the modern award safety net; it is about helping those employers and employees who we know have had difficulty getting into a bargaining culture to generally make enterprise agreements. Agreements in this stream will be the subject of genuine negotiation and exchange, where a wage increase is given in exchange for changes in work practices that deliver productivity or improved service delivery. When bargaining fails and agreement cannot be reached for a particular employer or employers, then Fair Work Australia, in very limited circumstances, can make a workplace determination to resolve the issues in bargaining. But, in doing so, Fair Work Australia must give consideration to issues of workplace productivity and the competitive position of the employer. This framework delivers on our election commitment and, quite frankly, could only be opposed by those who are not at all distressed by the circumstances of the low paid in our community.

I will turn to another claim that has been made during the debate: the bill gives unions excessive rights in bargaining. We are now up to claim 5. Forward with Fairness outlined that we would fully respect the rights of employees to join and be represented by a union or not to do so—as they wish, quite frankly. We are implementing our policy to the letter. There are no longer union or non-union agreements. All agreements will be made directly with employees. Where 50 per cent of employees approve an agreement, the agreement is made even where a union representing some of the employees may have urged a vote against it. Employees can, of course, be represented in the bargaining process by their union or by any other person they nominate.

Another claim made in the debate: the bill opens up a union right of entry to workplaces. That is claim 6. The government outlined our right of entry commitments in detail in the Forward with Fairness policy implementation plan. We promised that our right of entry laws would strike a balance between the right of employees to be represented by their union and the right of employers to run their business. Forward with Fairness set out in considerable detail that the bill would, first, ensure that only fit and proper persons hold a right of entry permit and that permit holders understand the right to enter premises comes with significant responsibilities. We are doing just this. Second, it would ensure that there are appropriate arrangements in place to enable duly authorised permit holders to meet with those workers who are eligible and who want to meet with them. We are doing this. Third, it would allow union officials who have a right of entry permit from the Australian Industrial Registry to visit employees in three circumstances: to investigate breaches of industrial laws, awards or agreements, to hold discussions with employees who are members or are eligible to be members of the union or to investigate breaches of occupational health and safety law. The bill does all of this. On any reasonable examination, arguments that the bill does not comply with our election policy are plainly false. We make no apology for respecting the fundamental right of employees to join and be represented by a union. This means having access to advice and information from a union. No-one can be made to join the union; no-one can be made to attend a meeting. Our right of entry policy was detailed and is being implemented, and it is a policy that is essential to meet the most basic principles of freedom of association. Employees are entitled to join and be represented by their union.

Another claim, claim 7, was about inspection of nonmembers’ employment records. A significant amount of debate has occurred on the question of whether a union permit holder should be permitted to inspect employment records relating to nonmembers. Much of the debate was ill-informed and inaccurate and requires correction. Laws that ensure compliance with awards and agreements are important both for employees and for the vast majority of employers who comply with the law. Employees should not be underpaid, and employers doing the right thing by their workers should not be undercut by competitors who are not. Unions have a longstanding role, going back many decades, in ensuring compliance with awards and agreements—and this is provided for even under Work Choices. Subject to strict requirements, union permit holders are currently entitled to enter work premises in order to investigate suspected breaches of awards and agreements and to take recovery action to ensure employees receive their correct entitlements. To carry out this compliance role, unions must be able to examine relevant workplace records.

We have heard in the Senate today and yesterday wild and, quite frankly, hysterical prophecies of union officials dancing through bedrooms with photocopiers under their arms or jumping out of people’s cornflakes. Claims have been made that a union permit holder can look at every employee’s pay records, from the managing director down, to satisfy some intellectual curiosity. Let us take a reality check here. Of course under the Fair Work Bill a right to investigate breaches of the law should come with strict responsibilities, and it does. The bill retains the right of entry permit system, and strict obligations apply concerning the giving of notice to the employer and the permit holder’s conduct while on the premises.

The bill also strengthens the existing provisions by introducing for the first time the application of the Privacy Act regime to the handling of documents and information obtained under the provisions and by introducing new penalty provisions for any misuse of records. The Office of the Privacy Commissioner made a submission to the Senate committee suggesting some amendments to the bill to improve its operation. The Deputy Prime Minister has foreshadowed that the government will move amendments that fully address the issue raised by the Privacy Commissioner on how the operation of the provisions can be best improved. The amendments will include a new broad antidisclosure penalty provision which will impose heavier penalties if any information obtained in the course of right of entry is misused. Amendments will also make it clear that the right of entry for the purpose of holding discussions may only be exercised for the purpose of talking to employees and not independent contractors.

In order to correct the record I will now clearly set out the operations of provisions of the bill concerning the inspection of documents and what a union permit holder can actually do and not do under the bill. First, to enter premises the permit holder must reasonably suspect that a contravention of an award agreement or the act is occurring or has occurred and that a breach must actually affect a member of the union. Let us be very clear: the union cannot enter a workplace or look at any record unless the union reasonably suspects a breach of the law that affects one of its members. There are serious penalties if a permit holder makes any representation that he or she suspects a breach when he or she does not, or that the union has a member affected by a suspected breach when the union does not. The onus of proving that a person has a reasonable suspicion of such a breach falls on the permit holder.

Second, before seeking to enter, the permit holder must give written notice to the employer, including details of the alleged breach. The employer is able to challenge this notice to Fair Work Australia if it does not believe that the strict criteria I have outlined are satisfied. It is only once these strict requirements are met that we even get to the question of what documents can be examined by the permit holder in order to investigate the alleged breach. A permit holder is able to inspect documents directly relevant to investigating the alleged breach that affects their members in respect of which they hold a reasonable suspicion, a suspicion they carry the onus of proving and in respect of which they have given notice and particulars to the employer. (Time expired)

Question put:

That the amendment (Senator Hanson-Young’s) be agreed to.