Industrial Relations can change for the better

Yesterday’s announcement by the Prime Minister brings the opportunity for industrial relations in Australia to change for the better as the nation rebuilds from the economic damage caused by COVID-19.

It appears that the Government is not aiming for the type of “business or unions first” reform that last caused difficulties for the Howard government over 10 years ago but rather a consensus approach not seen since the early days of the Accord more than 35 years ago.

The Prime Minister has announced that Industrial Relations Minister, Christian Porter will chair 5 working groups made up of business and union representatives in the following areas between now and the release of the October Budget (Due on 6 October 2020).

The working groups will cover the following areas, and the Prime Minister’s comments or rationale is noted too, for context:

  1. Award simplification – As this is what small and medium sized businesses deal with “every single day”.
  2. Enterprise agreement making – “We’ve got to get back to basics”.
  3. Casuals and fixed term employees – Apparently “made even more prescient by recent changes through the Fair Work Commission”.
  4. Compliance and enforcement – Since “People should be paid properly. And unions need to, obviously, do the right thing. As must employers.”
  5. Greenfield agreements for new enterprises – As this is “where the new investment will go and the certainty is needed more so than ever”.

Apart from confirming the involvement of business and unions in the working groups, the Prime Minister has confirmed his government will pause its pursuit of new laws which would have allowed courts to deregister rogue unions and officials.

This looks to be a concession aimed at building on the goodwill that the Government has built with unions in the response to the economic challenges of COVID-19.

This process is being described as similar to the Accord but this is not simply about wages; dealing with business concern with overregulation and red tape is covered in the “Award simplification” and “Enterprise agreement making” working groups but this is balanced against a working group dealing with the protection of employee rights through “Compliance and enforcement”.

Employers, industry groups and employee representatives will be invited to join each group, as well as individuals chosen based on their demonstrated experience and expertise. This will include “especially small businesses, rural and regional operators, multicultural communities, women, families”.

The purpose of the working groups is to attempt to reach consensus on industrial relations reform.

The process will be “time bound” and the PM has indicated that the process will move quickly, noting “It will become apparent very quickly if progress is to be made. The working groups will either reach something approaching a consensus on issues, or they won’t.”

Kingston Reid will contribute to the public debate that accompanies the discussions and policy responses that the working groups may develop.

What should you do?
  1. Give careful consideration to how your voice is heard during the debate. Will you contribute? If you contribute, will it be through direct comment or via an industry association or other representative?
  2. Think about the areas to be covered by the working groups are relevant to your business?
  3. Keep up to date with reform proposals so that you can build the potential for change into your long term planning.

Although it is the very early stages, we see the potential value in this process for you and the Australian Economy.

Duncan Fletcher
+61 8 6381 7050
[email protected]