John Quiggin has written his promised analysis of the IR Reforms (in draft form). As John notes:
IR is a very complex topic, and for that reason I’ve tended to shy away from detailed analysis in the past. But with major changes inevitable, there’s no alternative but to get immersed in the details.
Indeed. As I’ve previously argued, the devil is in the details. As someone with postgrad qualifications in IR, and who’s worked in IR consultancy and taught and published on it, a few things about individual contracts and AWAs supplementary to John’s points occurred to me (again – this is instant analysis as no-one has yet seen the draft bill):
(a) Many certified agreements (ie EBAs) prohibit the offering of AWAs to staff covered by them. Where this is not the case, the AWA is to be interpreted so as not to be inconsistent with conditions granted in the CA. As in the current changes in Higher Education, the intent of the government is to prohibit these arrangements (so although the argument is that AWAs can supplement CAs by offering higher pay and conditions, it could also work in the opposite direction).
(b) AWAs are currently tested against award conditions to see that the employee is not disadvantaged. The Federal legislation has a weak “no-disadvantage clause” compared to the Qld legislation but it nevertheless ensures that basic award minima are preserved. The new test will be against the minimum wage and other legislative minima. The effect of this is to render the award system irrelevant if the employer so chooses — in that the AWA can negate most of the allowable 16 award matters and offer a lower pay rate (or get rid of penalty rates etc) without any tradeoffs.
(c) The current legislation provides that the starting point for an AWA offer to employees doing substantially the same duties has to be the same. This is going out the window, I think.
(d) The secrecy provision in AWAs is very disturbing. Aside from making it difficult for researchers to judge their effects, it can also lead to the effective invalidation of provisions relating to gender equity, for instance. In some large corporations, men are being paid 10k more a year for doing the same work as women, and no effective legal recourse is available unless the employer or employee voluntarily discloses the pay rates prevailing under the award.
(e) The figures about the higher wages prevailing on AWAs touted by the Government are highly misleading as they don’t take into account the fact that two of the largest areas of penetration by AWAs are the relatively highly paid sectors of the public service and mining. Communications — which is also a sector where AWAs are common because the Government has put pressure on Telstra to offer them, and because Optus was established as a non-union company, would be a better test. Evidence on the use of AWAs in unskilled manufacturing and transport sectors suggests they usually are very unfavourable to employees.
(f) The Qld legislation prevents employers from converting employees into contractors if the intent is to reduce their pay and conditions or avoid payment of oncosts such as super, leave entitlements etc. However, the government’s legislation may lack effect here as the Courts have been using a test for who actually is an independent contractor and the thrust of the caselaw has been to suggest that claiming people working on an assembly line (for instance) are is illegal at common law.
On the last point, there may well be some interesting unintended consequences of the Government’s legislation as the playing field shifts from the Commission into the Courts. One Industrial lawyer (generally supportive of the thrust of Government policy) certainly thinks so.
Aside from the possibility that the legislation’s passage through the Senate won’t be smooth sailing, there are other rocks ahead for the Howardians. Peter Beattie has just announced that he will be legislating for penalty rates, long service leave and other minima in Queensland legislation. Howard will have to specifically legislate to take these conditions off Queensland workers. Shows why Beattie is a smart politician!
Elsewhere: Tim Dunlop and Liam Hogan are also keeping track of developments. Flutey sees the Government blaming all sorts of unrelated issues on “unreformed” IR.
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