Industrial Relations Society of WA

I thank you for the opportunity to address your Society in Margaret River today and for giving me an opportunity to again visit the beautiful South West.

I have been asked to provide a bit of an update of where workplace relations policy and law is up to, from a Democrat perspective.

Before I do, I should remind you why the Democrats hold much more of a pivotal role in this field, than in almost any other policy area.

Ideologically speaking, in policy terms the Coalition, in opposition or government, can be relied on to support as little regulation in industrial relations as possible. Ideologically speaking, the Labor party has an opposite view. That does not mean that Labor is incapable of change, as 1993 showed, but Labor seems to have much less discretion in IR in opposition than in government.

So when Labor freed up federal industrial relations in 1993, the Coalition were enthusiastic supporters. When the Coalition tried to free it up further in 1996 Labor were strongly opposed. In both 1993 and 1996 the Democrats retained the same policy perspectives. Our support was not needed in 1993 - it was in 1996.

The question is how much freedom does either major party have to develop its own policy perspective. Does money call the shots? Well as far as one can tell, yes and no. Funding disclosure returns by the major parties between 1992 and 1998 reveal a six year average of just on $22.5 million a year. The Coalition is principally funded by business, Labor by business and the unions. Yet the unions appear to call the IR shots with Labor far more than business does with the Coalition or Labor.

Money may talk, but it is votes that really matter. The union influence in Labor is a matter of numbers, particularly on preselections and in regard to their policy votes. It is the return of huge numbers of unionists to Parliament that gives the unions their say over Labor's IR policy direction. This is what Carmen Lawrence said to the Sydney Institute in August on Labor's malapportioned voting system:

Unions - honourable contributors to Labor history and policy - exercise disproportionate influence through the 60:40 rule and through their affiliated membership, many of whom have no direct connection to the party. One vote, one value - the prime condition for a democracy - is not observed in the party's rules.

And this is how Labor's Gary Johns, a former minister in the Keating government, now researching a PhD on preselection procedures, was quoted in the April edition of the Bulletin:

His research reinforced the view that Western Australia's Labor Party had the most "crooked" preselection of any ALP branch. "Local branch members have no say in pre-selection, there is no sense of democracy in WA..."

Holding the balance of power in the Senate means that the Australian Democrats therefore end up with the review and decision job, as in most workplace relations matters the Labor party simply behaves as the political wing of the unions.

This cuts down the normal options of the Coalition for Senate support from two political parties to one, and increases their frustration enormously when the Democrats won't play ball. In recent months, Minister Peter Reith has taken to the Democrats for refusing to support any of his IR laws introduced since 1997.

Of course, that is not entirely accurate. The Democrats have strongly supported the Government's initiative on protecting employee entitlements, although we have commented that these reforms have not gone far enough.

And, we have been in long negotiations about changes to workplace superannuation arrangements to give employees more choice of fund. My colleague Senator Lyn Allison has dealt with that matter and I don't propose to discuss it today.

And I have been a strong supporter of moving from six industrial relations systems to one.

But as he rightly says, we have indeed opposed pretty much every actual reform bill to change the Workplace Relations Act since we passed some technical bills in 1997.

And we have done so for a simple reason - not a single bill put up by Peter Reith since then to the Senate has been fair and balanced to both sides.

In 1996 Mr Reith's policy side was to the fore - strong, consistent and persuasive. We amended his bill over 170 times, but on policy terms we supported it.

Since 1996 Mr Reith's strong political side has mostly been to the fore. As a result union antagonism to Mr Reith can be quite extreme.

The downside for the Coalition has been the generation of a community climate, which makes it very difficult to advance workplace relations policy much, and is worsened by the blatantly political intent of many bills.

His unfair dismissal bill sought to deny access to redress for unfair dismissal for hundreds of thousands of employees because they were employed by small businesses falling under federal law, even though the clear evidence was that the 1996 unfair dismissal law changes he and I made were working effectively and fairly. Reform was needed to process, but trying to take away rights was extreme.

His junior rates bill sought to entrench discrimination on the basis of age in Australian awards that already share with the Netherlands the distinction of being the most discriminatory of any modern industrialised economy.

His second wave bill was larger than 1996 and contained 18 schedules of major changes, many reducing employees rights and entitlements, when what was needed was more measured and incremental change to a 1996 law that was still settling in.

Mr Reith's recent pattern bargaining bill dealt with some potential abuse of protected action by unions by effectively prohibiting virtually all protected action in industrial disputes, radically altering the power relationship between unions and employers.

The Democrats do not play the mindless 'just say no on IR bills' game that the unions want us to. But, if a proposed law proposes bad law, unfair law and the unbalancing of rights, we will not support it.

All the evidence to date shows that there is little need to radically amend the 1996 IR law. The law is working well.

In the last four years, it has helped deliver rising productivity, rising real wages, a sharp fall in industrial disputes and an increase in employment. That is a record that is worth keeping.

The 1996 law provides extensive flexibility on above award conditions. The only thing it is rigid about is not allowing flexibility to reduce award conditions. And that is a path that the Democrats refuse to go down.

Peter Reith has now introduced another four bills into the Parliament that incorporate four of the schedules from his failed Second Wave bill last year.

Of these four schedules, two were unacceptable to the Democrats and we rejected them last year. Two others we would have amended.

The first is the bill on secret ballots. At least that is what it purports to be about. What it is actually about is making it so difficult for unions to take industrial action that as a weapon it is virtually useless to them. That to me is unbalanced. The Industrial Relations Commission already has the power to order secret ballots where it believes that such a ballot might assist in resolving a dispute. The power is rarely used. Indeed, employers rarely invoke the secret ballot provision in the WA law. The issue really is a non-issue.

The second bill is on AWA procedures. The Democrats support the AWA system as providing some necessary flexibility above award. But, there is evidence that some employers, who are seeking to use the offer of AWAs to undermine collective bargaining processes, are abusing the system. While the Federal Court in the Commonwealth Bank case has raised questions about whether employers can get away with this, the Democrats are not prepared to look at making AWAs easier and simpler to obtain until the proper legal balance between individual and collective agreements is set out in the Act.

Minister Reith refuses to do that, and as a result we are not prepared to entertain opening up more access to AWA approvals.

The other two bills he introduced were on unfair dismissal procedures and on allowable award matters.

On unfair dismissal procedures, the bill seeks to tackle what I think are some valid concerns with the way unfair dismissals are dealt with in the Commission. But, as a whole, the bill goes too far in reducing employee's rights and access to redress for unfair dismissal. We need to keep in mind the original slogan Peter Reith invented in introducing his rewrite of unfair dismissal laws in 1996 - the fair go all round.

That means developing a system that is fair to both employees and employers. We need to deal with abuse of process by both sides. That is true. But we must try to do that without reducing fundamental rights.

On allowable award matters, the Reith bill proposes removing tallies and union picnic days as allowable award items. Again, I have some sympathy with this bill but could not pass it in its current form.

The Commission has already concluded a test case on the removal of tallies. It is only a matter of time before the Commission removes tallies from awards anyway.

The biggest single thing Mr Reith could do to speed up the Commission's review of meat industry awards is move to fill the 15 vacancies on the bench he has refused to fill since 1996.

That is because the biggest single delaying reason on current Commission cases is overworked commissioners. So, I don't have much sympathy with Coalition arguments about the Commission being tardy when the Government is refusing to give it the resources to do its job.

On union picnic days, there is an element of Government beat-up about this issue. At present, most union picnic days in awards just substitute for another public holiday. However there is a case for some reform, which I will take to our party room.

Mr Reith has several other proposals currently out for discussion and likely to turn up as law next year on issues like registered organisations, transmission of business and use of the corporations power.

The Democrats have not yet considered these policy papers so I cannot really comment on them today, except for the last one.

The Democrats see much merit in moving to a single industrial relations system in Australia.

We would prefer to see that occur by cooperation, leading to a voluntary referral of State IR powers to the Commonwealth.

I can't really see that happening, because a Labor State Government would never refer power to a Coalition Federal Government, or vice versa, on an area as contentious as IR. Anyway, Premier Court holds state rights dear, as do all the unions and business organisations with vested interests. Talk about globalisation, we can't achieve Australianisation!

We can't even achieve referrals of power on what should be non-contentious issues like corporations law, let alone an ideologically contentious area like IR.

Relying solely on the corporations power to create one IR system has two potential problems.

First, it will exclude small business, because 70% of small businesses are unincorporated.

Their employees will then be denied the protection of the new Federal awards. Second, while the concept is attractive to many, the content will create huge arguments. For instance Mr Reith implies that new Federal standards could be only a 'safety net', implying a lesser list of allowable award matters than is provided in the 1996 Act. This is something that deeply concerns me, as I put a lot of work into the 1996 list of allowable award matters and I think it is a fair list as it stands. Also, the award simplification process has been a huge effort over the last four years and still is not complete. To ask parties to start it all over again would strike me as a waste of energy.

In summary, major policy change is not likely in the medium term. However further change will occur on a moderate basis. The Democrats will continue to be active and constructive participants in the workplace relations debate.

We are not beholden to either unions or employers. As anyone who has read my minority reports would know, we do consider legislation carefully and we do try to be fair to both sides, while promoting low cost, open and reasonable practice and procedures.

The Democrats will say no to legislation that reduces fundamental rights or protections for employers or employees, whichever government is in power. But, we will try to amend legislation, which we think improves the operation of the current law.

Workplace relations law is an evolving feast. That much I know. We are now starting to get a good body of case law about what the 1996 law means. Those rulings have tended to confirm in my view that the 1996 law was a fair balance between the rights of employers and employees. The economic data I referred to earlier suggest that the law is delivering good results.

My inclination is if it ain't broke, don't fix it, just maintain it. If it is demonstrated that it is a bit faulty, then do minor repairs, but make sure they are even handed.

Senator Andrew Murray, Workplace Relations Spokesperson, Australian Democrats