Mark Arbib (NSW, Australian Labor Party, Minister Assisting the Prime Minister for Government Service Delivery) Share this | Hansard source

The Rudd government was elected with a mandate to abolish Work Choices and bring balance and fairness back to Australian workplaces. We also undertook to pursue a national workplace relations system to secure Australia’s future economic prosperity. We achieved the first step with the passage of the Fair Work Bill 2009. Today the Senate will decide the fate of a major microeconomic reform, the creation of a single national workplace relations system for the private sector. For the first time in Australia’s history the state governments, except Western Australia, have all taken steps to refer workplace relations matters to the Commonwealth.

Australian businesses recognise that the national workplace relations system that will be created by this bill is of crucial importance. There is strong support for the national system, with major business groups around the country—including ACCI, the National Farmers Federation, the Australian Mines and Metals Association and the Australian Industry Group—all calling for this reform. This will be a major piece of economic and microeconomic reform that will improve the productivity of businesses across the country. I commend the bill to the Senate.

I seek leave to incorporate a response to Senator Xenophon’s concerns.

Leave granted.

The document read as follows—

I propose now to address certain issues raised by Senator Xenophon with the Government concerning the horticulture industry and its modern award.

The Government is delivering award modernisation, being to create around 125 awards from the thousands of overlapping state and federal awards that currently apply. This is an enormous task for the Australian Industrial Relations Commission (the AIRC), whose members are doing an outstanding job in delivering this major economic reform.

Concerns have been raised however in relation to a small number of those modern awards.

Representatives of the South Australian horticulture and wine industries expressed concerns earlier this year about the potential cost increases that would arise from the proposed modern awards applying to these sectors, particularly in relation to changes made to award provisions on piecework, casual loading, span of ordinary hours, overtime and penalty rates.

Senator Xenophon raised these issues with the Deputy Prime Minister, as did representatives of the industry. The Deputy Prime Minister gave careful personal attention to these issues and as a result, varied her award modernisation request. The amended request requires the Commission to have regard to the current terms and conditions that apply in the industry and the need for flexible hours of work arrangements given the seasonal factors that are critical to the viability of the industry.

The hearings to finalise the horticulture industry award are continuing with the full involvement of industry parties. The Government is confident that the Commission’s ultimate decision will accord in full with the Minister’s varied award modernisation request and will meet the needs of the industry.

Senator Xenophon has also raised concerns on behalf of the horticulture industry that, given these further changes are yet to be made to the modern award and it commences on 1 January 2010, there needs to be sufficient time for the industry to understand the new award. I wish to make a number of points on this issue.

First, the AIRC has published a model clause setting out five year transitional arrangements. Changes from the state standard of remuneration to the new national standard will be introduced through five annual increments (up or down) on 1 July of each year.

This means that for all employers in the federal system, there won’t be any changes to remuneration that come into practical operation until 1 July 2010. The status quo will continue in respect of all pay related matters until that time.

The Commission’s decision on transitional arrangements will ensure employers will in effect have a six month grace period to become familiar with the new modern award before they are at risk of being non-compliant with remuneration related entitlements.

Secondly, those horticultural employers referred into the national system by the States will stay on their state-based award conditions until 1 January 2011. During those 12 months, Fair Work Australia will determine appropriate transitional arrangements in consultation with those affected. Referred employers will be aligned into the existing phase-in arrangements in the modern award. This means there will be plenty of time for those employers to adapt to the new system.

Thirdly, following Senator Xenophon’s representations, the Government wishes to record that if, following the Commission’s determination on the final content of the modern award, an application is made by any party for revised transitional arrangements in respect of the Horticulture Modern Award, the Government would make a submission that the AIRC, in considering that application, should have regard to the following matters:

• First, the particular features of the industry, including seasonal demands;
• Second whether it would be desirable for the industry to have an additional period of time to become familiar with the terms of the award, having regard to:
• the nature of any changes made to the modern award as a result of the applications to vary, and the timing of the announcement of those changes compared to their commencement of operation; and
• the nature of employers in the horticulture industry, given the predominance of small businesses.

I also want to outline the steps being taken by the Government to assist employees and employers in the horticulture sector to have the information they need to know their rights and comply with their obligations. The partners in the Horticulture Industry Shared Compliance Program—the industry associations and the AWU—will work cooperatively together with the Fair Work Ombudsman to educate employers and employees and to promote compliance. This is an innovative program and demonstrates the Government’s approach to cooperative workplace relations.

The emphasis of this program is education, rather than prosecution. What this means is that while the FWO will still be able to prosecute for serious and blatant breaches of the award, the majority of formal compliance activity will not commence until July 2011 at the earliest.

I thank Senator Xenophon for the constructive way in which he has raised these issues with the Government and trust that he is satisfied that the Government has responded appropriately.

Question agreed to.

Bill read a second time.