GreensBlog - the official blog of the Australian Greens Senators

Or ‘Will Labor’s IR laws be the biggest ever fraud on the Australian public?’

Today we have the pleasure of featuring a guest post from Adam Bandt, who stood for the Seat of Melbourne in the 2007 Federal election.

One of the most enduring images of the federal election campaign is from an ACTU advertisement. The distressed ‘Tracey’, kids surrounding her, employer barking threats down the phone, could have been anyone who was enduring the reality of the rising cost of living, declining public spending on childcare and a set of regressive IR laws. Most confronting to Tracey was that under WorkChoices the employer now had the whip hand and could alter her ‘work/life balance’, such as it was.

It’s unclear if Tracey knew anything about Labor’s ‘Policy Implementation Plan’ (PIP), released on 28 August 2007. Although it was relatively widely discussed at the time amongst the industrial intelligentsia, its key features seemed to have been forgotten as election day drew closer.

In August, under the slightest of blowtorches from various employer interests, Kevin Rudd blinked, and reversed many aspects of the policy developed at the ALP’s conference in April. John Howard had a choice at this point. As we know, Howard ultimately chose to the path of painting Rudd as a tool of the unions. The Liberals proceeded to roll-out billboards, print and TV ads claiming that the unions were coming back and that 70% of ALP frontbenchers were unionists. We’ve seen how well that worked for them…

Instead, he could have claimed this as another ‘me-too’ scalp, another sign that Rudd was willing to replicate conservative policies to minimise areas of disputation. This might have neutralised the IR issue, or at least made it a lot less potent, and taken some of the sheen off Rudd. Senator Barnaby Joyce has recently let the cat out of the bag on just how similar the parties’ IR policies actually are, signalling that he may vote for Rudd’s package.

However, during the election campaign, each of the major parties soldiered on with their respective public positions. The Liberals with their anti-union scare campaign; and the ALP, with numerous statements that they would tear-up WorkChoices, abolish it, restore fairness, and so on. With some notable exceptions, by and large the union movement continued on as if nothing had happened. The public relations campaign from the unions was phenomenal, cohesive and one of the most effective campaigns ever seen run. Any voter that came within cooee of a Labor stump speech or of the Your Rights at Work campaign would have been left with one completely justifiable impression: “I should vote Labor if I want to get rid of Howard’s IR laws?” Since election day, this is certainly how the result has been received, with some commentators going so far as to say this was a referendum on WorkChoices.

Which is why, when we read the details of the August PIP, we have to pose this question: is Labor going to commit a fraud on the Australian electorate? Are we about to see the key elements of WorkChoices kept in Labor’s legislation? The PIP suggests that we might.

What exactly was WorkChoices and what did it do? First, it was new legislation that created a form of individual agreement, innocuously named Australian Workplace Agreements (AWA) that could vary the wages and conditions applicable in the award or collective agreement that would otherwise apply to you at work. AWAs would operate to the effective exclusion of the award or certified agreement. Prior to WorkChoices, you couldn’t vary a collective agreement on an employee-by-employee basis. Despite what Tracey might think, Labor is not ripping-up this part of WorkChoices.

The PIP outlines another round of award stripping and rationalisation by the new industrial relations commission that will doubtless see many conditions lost. But more insidiously, although awards will remain as the floor, Labor has made the floor much less stable.

To quote the PIP:

Under Labor’s new system, awards will provide the parameters within which flexibility arrangements can be made under an award flexibility clause. This may include matters such as:

• rostering and hours of work;
• all up rates of pay;
• provisions that certain award conditions may not apply where an employee is paid above a fixed percentage as set out in the award.

In my experience (and I’d stand to be corrected) flexibility clauses under the WorkChoices regime rarely contained such widespread subject matter. Awards will now be required to have ‘new’ flexibility clauses that allow supposedly firm minimum conditions - like rostering and hours of work - to be traded off for cash.

Let’s pause to think about what’s going on here: these things are in awards precisely because they shouldn’t be able to be traded off and be the subject of individual negotiation, because that erodes the firm protection they offer. Labor’s PIP does not rule out the prospect of an employer offering a new prospective employee a job on a ‘take it or leave it’ individual contract basis, with a contract that varies the award. And in case there’s any doubt that the intention is to allow these conditions be traded off, look at the media release that accompanied the PIP, which says:

Small business operators will be able to employ their staff under modernised and simplified awards and with new flexibility clauses for those employees they pay at above award rates.

Labor’s policy is clearly about facilitating trade-offs in a way that wasn’t permissible before WorkChoices, and does not rule out the prospect of an employer offering a new prospective employee a job on a ‘take it or leave it’ individual contract basis, with a contract that varies the award. The PIP says:

The [award flexibility] clause must be as simple as possible for an employer and employee to understand and implement and will be subject to the genuine agreement of the employer and employee without any coercion or duress.

Anyone who is attentive to the jurisprudence of ‘duress’ will know that whilst you cannot force an existing employee to change their conditions, it does not constitute duress to offer a contract as a condition of employment for a new job.

These arrangements are not the ‘common law contracts’ that Julia Gillard spruiked during the election campaign. Common-law contracts sit on top of a firm award floor; Labor, with a sleight of hand, is weakening the floor by legislatively allowing to be varied by individual arrangement.

But there is something further that didn’t exist before WorkChoices. Labor’s PIP is intending for the first time to make collective agreements variable by individuals. To quote the PIP again:

Under Labor’s new collective enterprise bargaining system all collective agreements will be required to contain a flexibility clause which provides that an employer and an individual employee can make a flexibility arrangement.

The aim of the flexibility clause is to enable individual arrangements which are genuinely agreed by the employer and an individual employee. Before WorkChoices, a collective Agreement was of superior applicability and couldn’t be overridden by anything. Now, under Rudd, an individual will be able to vary the collective agreement without having to obtain the consent of the other parties to the collective agreement, namely the union and their co-workers. And although there might be some sort of ‘no disadvantage’ test that means they get some money for the conditions they trade off, what about the disadvantage that the collective suffers when the conditions that they fought for become eroded?

The Liberals also had a way of varying a collective agreement: it was called an AWA.

Critical here is that the ability of AWAs to trade off wages and conditions is only part of their charm for employers. AWAs can continue for up to 5 years. The cycle of a collective agreement involves all workers negotiating at the same time. They can take industrial action in support of the agreement. They are then all subject to the same agreement for a number of years, and then when it expires, it expires for them all at the same time, and the process begins again.

All of this changes with AWAs: workers are generally forced to sign on when they start their job, and the agreement expires at a time of the employer’s choosing, usually after a set number of years. This means that - by circumstance or by design - the AWAs for workers in the same workplace will expire at different times. At any given moment, there will only be a small number of workers able to renegotiate collectively. The employer’s bargaining power is massively increased. Staggered expiry dates, with the law prohibiting renegotiation and industrial action for the duration of the agreement, reveal a real attraction of AWAs for business.

This is why Labor’s so-called ‘transitional’ arrangements have the potential to defuse much of the explosiveness of their ‘abolitionist’ platform. Unless workers are able to immediately come off AWAs onto collective agreements, they will be stuck in a cycle where they cannot bargain collectively with their co-workers. Under Rudd, this will continue for up to 5 years. Even this time period will only start whenever Labor gets its legislation before parliament.

I think it is somewhat strained to suggest in newspapers that employer’s aren’t playing by the rules by signing people up to AWAs before Labor’s legislation: after all, couldn’t Gillard just do what the Liberals did with the fairness test and announce that the new test will apply from today, and the legislate accordingly?

Labor has said in the PIP that Awards won’t apply to high income earners:

Labor in Government will legislate to confine the application of Labor’s new award system to employees who earn less than $100,000 per year when the new award system commences on 1 January 2010.

This is going to affect industries like firefighting where the whole of rank structure is covered by an award, and has been for many years. So, currently covered employees - even those covered under WorkChoices - will be denied coverage and left completely to the market.

Before WorkChoices, a union could be party to a s170LK non-union agreement. Even that slim protection will go, meaning that employers can potentially negotiate agreements that will affect unions and their members, but without the union being able to be party. Under the system of the former Labor Government, an employer was required to notify an eligible union that it had commenced negotiations with its employees for a ‘non-union’ agreement and required to provide each such union a reasonable opportunity to take part in the negotiations for the so-called ‘non-union’ agreement. The union was also entitled to be heard by the Australian Industrial Relations Commission in connection with the approval or extension of the agreement.

None of these requirements will be in place under Rudd.

The second major element of WorkChoices concerned industrial action. To negotiate your wages and conditions, one is meant to be able to use one’s industrial leverage. WorkChoices forced employees and their unions to do this with one hand tied behind their back, and introduced compulsory secret ballots, made it compulsory for the Commission to issue orders to stop industrial action, and began to criminalise employees or unionists who didn’t comply with AIRC orders. Labor made much of this when WorkChoices was introduced, and Labor Member Steve Georganas said in Parliament during the debate:

This government has an ideological hatred of trade unions and in this bill has gone to great lengths to shackle their ability to act on behalf of Australia’s working men and women. This government’s legislation is nothing less than a full-frontal assault on the rights of working people to organise in defence of wages and working conditions. It seeks to make access to workplaces by union representatives much more difficult, it seeks to curb the right of workers to take legitimate industrial action, it seeks to provide the minister with extraordinary powers to interfere in industrial disputes-which, incidentally, are at a historical low-and it seeks to impose harsh penalties for even the slightest infractions by workers or their representatives. In short, this bill is an attempt to get rid of unions while not actually prohibiting them outright.

Indeed that was the case. As anyone who tried to work within the legislation knew, all the cards were in the employers’ deck. The remedies were extended to be available to not just employers, but people affected by industrial action, so it was with great surprise that these staunch defences of trade union principle (made less than two years earlier) suddenly vanished, and instead we read this in Labor’s PIP:

The current arrangements for obtaining orders to stop or prevent unprotected industrial action will continue to apply, including the current arrangements for obtaining interim orders.
Access to the courts for breaches of common law torts will continue to be available.
As is currently the case those affected also will be able to go straight to court to seek orders where unprotected industrial action affects them.

This isn’t ripping up WorkChoices: this is expressly keeping it.

WorkChoices introduced, for the first time, the ability of an employer to dictate how and where a union meeting would take place, and thereby discourage it. It also allowed for right of entry to be displaced by individual contract. It also put a heavy burden on unions who suspected a breach of an award or agreement. And what did all this mean in practice? Let me quote some of the letter from Michele O’Neil, TCFUA Secretary, written to Kevin Rudd and Julia Gillard in response to the PIP:

I represent some of the lowest paid workers in the country. They sweat in backyard garages, shopfronts, and factories to make the clothes on your back. Some of our members have now faced three years without a pay increase. If they are still getting the minimum rates, and many are not, they take home about $460 each week. If they work at home as outworkers they likely get $3 to $5 an hour. Yesterday one of the union’s officials described how after a call from a worker, she went to a factory and the employer made her sit for two hours in a small room. The boss said that if any worker wanted to see her they were welcome. He didn’t tell the workers the union was on site. He wouldn’t let the union notice advising workers that the union was coming, go up on the notice board. And he sat a supervisor at the door of the room. No worker came to the room… Last week we received two calls from women workers in tears because they were being forced to give up their rights by signing an AWA in order to keep their job. They signed the AWA because they were threatened. The same AWAs which you will now leave in place for five years. Under those Right of Entry laws, because all the workers are on AWAs, we have no right to enter that workplace or visit our members.

When an employer says ‘sign an AWA’, under WorkChoices the workers can’t call their union to come and meet with them confidentially at work. Without union advice and support, the workers invariably sign sub-standard agreements - precluding the union coming in the door at all, and so the cycle continues.

The Australian Building and Construction Commission is now to be kept for a few more years, and many future workers will never get their unfair dismissal rights back. Clearly this is not ripping up WorkChoices.

Personally, I am glad we had a change of government. Indeed, Green preferences got Labor over the line in many of the seats it needed to win. The Greens have been heavily involved in the campaign against Howard and WorkChoices. We have routinely called for the immediate abolition of the ABCC and AWAs. During this election campaign, The Greens stood steadfast on the need for individual rights and union rights to be protected and for everyone to have the right not be unfairly dismissed. But many of us thought that we were going to be rid of not only Howard, but his policies too.

The devil will truly be in the detail of Labor’s new laws. ‘Flexibility clauses’, for example, may turn out to be innocuous, but we have good reason to be suspicious. We must closely scrutinise Labor’s legislation to make sure we really do get rid of WorkChoices. Whilst their technical PIP might have said one thing, the impression Labor and its allies conveyed to the electorate was markedly different.

Did Tracey know when she voted for Labor that she’d be stuck for the duration of a Rudd government on her AWA, be unable to bargain collectively with her co-workers who were trying to get a collective agreement, and not be able to get her union to come and visit her confidentially in the workplace to discuss those threats the employer was conveying?

Unions and peak bodies will have a crucial role over the coming period. Are they willing to be as critical of Labor as they were of the coalition, or will Labor be able to get away with implementing most of what Howard wanted?

Let me conclude by tentatively offering 5 (non-exhaustive) principles that any new law from Labor should, at a minimum, meet:

I think that these are the things people voted for at the election. These are the kinds of tests we should be applying to Labor’s legislation when it hits Parliament.We’ll see if Labor’s laws are consistent with the spirit of what they conveyed to the Australian population. If the proposed laws don’t rip-up WorkChoices, then it’s not what Labor told the people they’d do.

Adam Bandt is an accredited specialist in workplace relations law and was The Greens’ candidate for the seat of Melbourne in the 2007 Federal election, where he achieved the highest ever primary vote for The Greens in a general election. This is a revised version of a paper given to the 6th annual Workforce industrial relations conference in Sydney on Tuesday 4th December 2007.