Nick Xenophon (SA, Independent) Share this | Hansard source

I rise to speak in relation to both the Fair Work (State Referral and Consequential and Other Amendments) Bill 2009 and the Fair Work (Transitional Provisions and Consequential Amendments) Bill 2009. I indicate that I will be supporting both bills at the second reading stage. I will not canvass what occurred during debate on the Fair Work Bill, which passed the Senate in March, and I do not propose to repeat these comments, but I wish to make three quick contextual points before moving on to the provisions of these bills, in particular the transitional provisions bill. As I said in March, Work Choices is dead, and I am not mourning its loss. I see that the purpose of this transition bill is to ensure that the final nails are smoothly struck and unable to come loose.

I wish to again thank the Deputy Prime Minister, and her office, for the manner in which she negotiated the amendments to the Fair Work Bill. I am pleased that as part of these negotiations there were a number of amendments ensuring better protections for outworkers, extending time limits for lodging unfair dismissal claims, expanding flexible working arrangements for parents of disabled children and establishing a specialist information service for small and medium businesses. I still maintain that a better deal could have been struck for small businesses in relation to unfair dismissal claims, but that is now water under the bridge.

It is my understanding that the vast majority of these two bills have the support of both the government and the opposition, so I will limit my specific comments to the amendments foreshadowed by the opposition. The coalition’s first amendments refer to the interaction of the NES and transitional instruments. Their intent is to prevent potential doubling up where the same condition is met twice under different parts of the instruments. It seems that the coalition has taken the term ‘detrimental in any respect’ in schedule 3, part 5, item 23 to mean that line-by-line comparisons will be made in relation to terms. It argues a doubling up may occur where the combining of conditions under previous arrangements has resulted in the term being exceeded against one line and then, because other new arrangements do not align neatly, met again under another line.

My understanding of the government’s response to these amendments is that it has concerns that the amendments could undermine some baseline NES protections and could result in non-negotiable NES protections being traded off for additional pay, while it is argued that workers do not suffer detriment overall. The coalition does not accept this and states that its intent is to maintain all National Employment Standards, but only to avoid the doubling-up resulting from a strict line-by-line approach. This matter would seem to be one of differing interpretations and I will be seeking more detail from both parties prior to the vote.

In relation to the coalition’s amendments to introduce no increased labour costs and to change default superannuation, I have indicated to both parties that I am disinclined to support these amendments and this was a debate that was had in the course of the Fair Work legislation earlier this year. I am always open to listening to the evidence, but I provided my reasons for not supporting these previously and I will not reiterate them. However, I am interested to hear from both parties about the operation of proposed changes to the five-year transition from existing arrangements to the new awards. I have made my views known publicly: that I am very concerned about the possible impact of these changes on the South Australian restaurant and catering industry, on aged care and on the horticulture sectors, particularly in the Riverland, which is an area that has been doing it very tough because of the crisis in the Murray-Darling Basin.

I am pleased to note that the Deputy Prime Minister has acted to address issues relating to the restaurant sector and note that the sector has expressed its satisfaction at her actions. That was welcome because it took into account the circumstances of that industry, and I welcome the Deputy Prime Minister taking that stand. As a result of the changes that have been foreshadowed, literally hundreds if not thousands of jobs in South Australia have been saved. The issues facing the aged-care sector are much more complex, and I look forward to talking to the government about ways to address the looming aged-care crisis. Obviously, it goes beyond the Deputy Prime Minister’s portfolio. I note that the Deputy Prime Minister has instructed the AIRC to use the full five-year transition period with aged care, and this is a positive step. However, I believe that the unique arrangement in the aged-care sector where the government controls public funding and regulates capacity to raise private funding is one that is pertinent to award modernisation.

How do employers pay high salaries and improve conditions if the government ties their hands so that they cannot raise the money to do so? While the five-year transition may be helpful, there are important issues in aged care, with nurses’ salaries and the shortage of nurses contributing to lower standards of care in that sector. The government must take seriously the calls by the ANF and the aged-care providers for increased funding for aged-care nurses. However, I do not support a separation of the award, as the Deputy Prime Minister did with the restaurants and hotels. Rather, it is for the government to increase funding to enable the pay and conditions of aged-care nurses to match that of their colleagues in the hospital sector.

As I said, I will be taking these matters up with the government in the coming days, but let me now deal with the specifics of the coalition’s amendment to the five-year transition arrangements that have been foreshadowed by Senator Abetz. My understanding is that the coalition wishes to enshrine the five-year transition as a default position from which the AIRC can use its discretion for a shorter period if it sees fit. This effectively flips the situation in the legislation to where the AIRC decides the length of transition up to five years. However, I note that the Deputy Prime Minister has publicly strongly encouraged the AIRC to opt for the five-year transition.

My understanding is that the government has concerns that this coalition amendment will allow award modernisation to be put off for five years, in effect delaying some economic pain that will be experienced by some employers at the end of the period. It was my understanding from previous discussions in relation to the Fair Work Bill that a multi-level, graduated approach would be used over the five-year period to minimise the impact, to avoid that short, sharp shock, and to assist in the transition. I would like the government to provide specific details in relation to this in the committee stage to reassure me that a one-stage jump to the modern award arrangement could occur either initially, should the AIRC not heed the Deputy Prime Minister’s advice, or at the end of five years, if the government’s criticism of the coalition amendment stands.

Finally, there is the issue of representation orders. The coalition, through their amendments, want to clarify the conditions whereby representation orders can be made in the case of demarcation disputes, as well as a greater role for employers in these decisions. These are addressed in clause 137 of the bill. The coalition’s changes to clause 137(a) appear to be in response to a request for greater clarity from persons submitting to the committee inquiry, such as Professor Andrew Stuart, as well as in the dissenting report. I do not think that anyone could accuse Professor Stuart of being a friend of Work Choices. He has been a very clear voice and a very critical voice of Work Choices, and I think that he provides a robust analysis of these particular clauses.

As a principle, I support measures that produce greater clarity in legislation, and I think that represents responsible legislating. Further, I do not oppose in principle the possibility of an employer approaching Fair Work Australia to request an order if they are aware of disputes so that it is not so narrowly confined. I look forward to the government clarifying why these proposed changes are not desirable, particularly given the comments made by Professor Stuart. He indicated that he thought that there was real scope for change in relation to this to clarify what the position was. I think we need to heed the advice of Professor Stuart in relation to that.

However, I do not find that the rationale behind the changes to clause 137(b) quite as clear, especially as to why the views of an employer are vital to making an order. I remain to be convinced, in terms of the coalition’s position, in relation to that. In the case where an employer has had a sound relationship with a union in the past and would like that to continue, surely that would be the first thing Fair Work Australia would look at when making an order? Does it really need to be stipulated? I look to the coalition to clarify why this particular change is necessary, and I seek information from both parties on the practical implications of adopting these amendments in relation to representation orders.

In summary, I look forward to further discussing this with both the coalition and the government and putting an end to Work Choices but in a way that has fair transitional arrangements. It is acknowledged that we are in tough economic times, the worst economic circumstances in some 70 years. We need to take into account these changed economic circumstances. We need to take into account the way that the horticultural industry, particularly in South Australia, is doing it quite tough, as is the aged-care sector, which I have referred to previously. The sort of flexibility that the government has shown in relation to the restaurant and catering industry, which is welcomed, is something that ought to be replicated in other industries to allow for that transition and to avoid the short, sharp shock.

It is also important to consider a broader context, and I think it was summed up pretty well by Kerry O’Brien on the The 7.30 Report on 11 June. In prefacing an interview with the Deputy Prime Minister, he made the point that Australia may have just escaped falling into technical recession but, for the 100,000 people who have lost their jobs in the past nine months, the recession is here. My concern is that too many credible employers are saying that unless we have a transition that is relatively smooth and that is graduated, and unless you take into account the genuine economic circumstances in particular industries, you will see a spike in unemployment. People will be laid off, and that is something that needs to be avoided. It is a difficult balancing act but I believe it is a clear public policy imperative. I look forward to discussing this further with both the government and the opposition in the committee stage in respect of the amendments that will be moved and, no doubt, debated at length.