|
On 27 March 2007 WorkChoices turned one year
old. The Federal Government is holding to the
line that WorkChoices has stimulated the
economy, created employment and as a result
workers and their families “…have never had it
so good”. [Prime Minister John Howard, Federal
Parliament 26 March 2007].
On the other hand you have the Federal
Opposition and a newly returned NSW State
Government advising that the overwhelming
feeling of workers and their families is that
they despise WorkChoices and “fear for their
futures” [Julia Gillard, Federal Opposition
Shadow Minister for Industrial Relations,
26 March 2007].
So no one was keen to hold a party when the
legislation achieved its first birthday. The
Ebsworth & Ebsworth workplace relations team
thought we would assist in these strangely muted
celebrations by offering some analysis of where
we have been with WorkChoices over the last
twelve months and where we might
be heading.
What has
happened in a year
The first and
most obvious change has been the sharp drop off
in unfair dismissal claims and an equally sharp
drop off in trade union activity. There can be
no argument about the reality of these
developments and indeed they were among the core
reasons for the enactment of WorkChoices in the
first place.
The second development has been an overall
increase in workplace agreements generally. The
balance between Australian Workplace Agreements
(AWAs) and Enterprise Bargaining Agreements
(EBAs) is overlooked in the media. The facts are
that AWAs simply do not suit every business. The
more employees a business engages, the less easy
it is to manage AWAs. However, AWAs are a
political talisman for the Howard Government so
the media debate tends to focus on them as the
entire issue. In fact, WorkChoices offers a much
more complex legislative fabric with which
employers have to deal and this is really where
the debate should lie. Clearly the capacity of
employers to actually make workplace agreements
of any type is greatly enhanced by WorkChoices
and that must be a good thing from both an
economic and a workplace relations point of
view.
Where disputes do occur both employers and
trade unions are still finding their way. The
Australian Industrial Relations Commission
(AIRC) has had some dispute hearings and so have
the State Tribunals. We have noticed how
(uncharacteristically) polite everyone has been
when dispute matters are heard. Whether this
continues depends on the future of trade union
activity. At the moment unions are waiting to
see what happens at the next Federal Election. A
curious calm pervades the landscape as that
waiting goes on. When the election is decided
unions will determine their strategies for the
next three years and that will have a
significant effect on how the workplace
relations landscape itself develops.
The other clear and unarguable effect of
WorkChoices is the sheer legal complexity of the
issues which do arise. Why the laws were made so
difficult for both business and workers we will
never understand. The apparently simple issue of
hours of work is a classic case. There have now
been two amendments to the regulations just on
this issue. We would hazard a guess that about
70% of employers still have no idea what records
they have to keep in respect of hours of work.
To help our clients this bulletin contains an
easy guide on record keeping.
Predictions for the year
ahead
Crystal ball gazing is always
dangerous stuff but we are going to give it a go
regardless! We are of course helped by the
release of Labor’s Industrial Relations policy
which Kevin Rudd announced at the National Press
Club on Tuesday 17 April 2007. Here are two
different paths along which Australia might
travel depending on who wins the
Federal Election.
Under the Howard
Government
WorkChoices will not be
amended to “soften” its impact. The Government
will push further ahead and extend its
independent contractor legislation to cover
lorry owner drivers. The State Governments will
be asked to give up their industrial relations
powers to Canberra. They will continue to resist
unless they believe that Labor cannot win a
Federal Election for the
foreseeable future.
Rules that make
life even more difficult for unions will be
introduced. Any final vestiges of award
protection for employees will be wiped out and
Australia will have a completely deregulated
labour market.
Under a Rudd/Labor
Government
WorkChoices will be
amended in some important areas. It seems that
Labor’s policy will reintroduce penalty rates,
overtime and shift allowances as statutory
minimums (at the moment they only exist for
relevant award or EBA structures so they can be
eliminated by employers with ease).
AWA’s will go. Presumably existing ones will
be allowed to run for a defined period and then
be deemed to lapse. Thereafter they will have to
be replaced with EBA’s (be they union or non
union). It does not appear that awards are
likely to be revived although the policy
announcement is a bit vague on that. There is
mention of “industry wide agreements” so they
may be the successor to awards if Labor succeeds
at the election.
Unfair dismissal rights will be revived in a
limited sense although businesses with less than
15 employees gain some relief in the sense
that employees must have been employed for a
year before they accrue a right to take an
unfair dismissal claim. For businesses with more
than 15 employees, an employee must have served
six months to have the right to make a claim.
Where claims are made lawyers are locked out of
the initial conciliation process.
And perhaps most importantly there will be a
new industrial umpire at Federal level and State
jurisdictions will be abolished assuming that
the State Governments give up their powers. Will
it be the AIRC in a new set of clothes? That is
not clear. But there will be one. This above all
is the clear dividing line in philosophies
between the Howard Government and the Rudd
Opposition.
The Tri Star
dispute
There are industrial
disputes that do matter, industrial disputes
that should matter and industrial disputes that
don’t matter at all. Whichever way you cut the
cake the Tri Star dispute matters. It has become
a battleground for what WorkChoices is all
about. The main fighters are not the company,
the union or the workers but instead the
politicians who are all seeking to gain the
moral high ground.
Briefly, the dispute started months ago when
Tri Star decided to scale down its operation.
The problems afflicting the car manufacturing
industry left Tri Star with little choice but to
down scale. However, they had a major problem:
the workplace agreement with the Australian
Motor Vehicle Workers Union (AMWU) contained a
redundancy provision that made it expensive to
lay the workers off. Tri Star’s apparent
strategy was to utilise its options under the
WorkChoices legislation in order to reduce its
redundancy costs.
The AMWU entered the fray on behalf of the
workers and immediately highlighted the fact
that under WorkChoices workers and unions have
very few options when it comes to complaining
about their entitlements (or the lack of them).
The AIRC has virtually no power at all and all
employees can do is hope that the Office of
Workplace Services does something for them. The
AMWU made this point loudly and often. However,
the union did not achieve any real success with
the company.
Then things became more complicated. The New
South Wales Government authorised the New South
Wales Industrial Relations Commission (ICR) to
initiate an enquiry into the whole Tri Star
dispute. The Commission needed little further
encouragement and hopped straight in with a
round of public hearings. How on earth there was
jurisdiction to do this we at Ebsworth &
Ebsworth do not know but jurisdiction was not
the State Government’s concern. Their concern
was to highlight the limitations of WorkChoices
and embarrass the Federal Government. When the
Tri Star Chief Executive gave evidence to the
enquiry that he had been advised by the Federal
Minister for Workplace Relations Mr. Joe Hockey
to sack the workers and rehire them on AWA’s the
Federal Government was staring at a public
relations disaster. It should be said that Mr.
Hockey denied giving this advice although he
declined to give evidence at the enquiry. Tri
Star then went to the Federal Court in an
attempt to shut down the enquiry.
On 14 April 2007 the Federal Court terminated
the New South Wales IRC enquiry for want of
jurisdiction. The dispute itself drags on but
the political damage for the Federal Government
that could have arisen from the enquiry has now
been averted. But what can our clients learn
from all this storm and tempest? Here is our
take on it:
- WorkChoices has achieved its primary aim of
eliminating the ability of a third party (an
industrial tribunal) from entering an industrial
dispute and doing something about it. Employers
have a free hand and all workers can do is
either rely on very limited civil remedies
before civil courts or hope that the Office of
Workplace Services takes up their cause;
- WorkChoices operates in a highly charged
political climate. Employers who care about
their public image need to be extremely wary at
this time; and
- unions will continue to assist their members
and will be forced to come up with novel ways to
do it. With industrial tribunals a dead letter
unions will become more inventive (and, one
imagines, less scrupulous).
Tri Star will remain in the public eye for a
while yet. One can envisage Tri Star being a
prime issue in the Federal Election. But the Tri
Star dispute reinforces this unarguable truth:
employer power has been legislated to an all
time high by WorkChoices. Whether it stays at
that peak remains to be seen. But it is at a
peak nonetheless.
The Office of Workplace
Services and your obligations
The Office of Workplace Services (OWS) was
set up when WorkChoices was enacted on 27 March
2006. Its role is largely designed to fill the
gap traditionally occupied by trade unions –
that of an employment watchdog. It has four
stated purposes:
- to provide advice and assistance about
compliance and enforcement under the Workplace
Relations Act;
- to conduct education and compliance
campaigns to protect the rights of workers;
- to investigate claims of breaches of
agreements, awards and the Workplace Relations
Act; and
- to initiate litigation in the courts to
enforce workplace laws.
The OWS has set up a hotline for enquiries
which are largely about the interpretation of
WorkChoices, the new pay scales and preserved
award conditions. Note that advice received from
the OWS should be carefully considered.
The OWS employs a large body of Workplace
Inspectors to investigate complaints and alleged
breaches. They also have the ability to issue on
the spot fines and improvement notices to
employers found to be breaching the law or
avoiding employee entitlements. These Inspectors
have significant powers under the Workplace
Relations Act which include:
- the ability to enter premises and inspect
any work, plant or machinery;
- to interview any person; and
- to require the production
of documents.
Non-compliance with a demand from an
inspector can have serious consequences
including monetary penalties and imprisonment.
In the construction industry, this role is
undertaken by the Australian Building and
Construction Commission which has the same
powers.
If your business receives a notice or enquiry
from the OWS-tread carefully. Given the serious
consequences which can flow from an OWS
investigation and prosecution it is wise to seek
independent advice at the earliest possible
opportunity.
New
record keeping provisions
For
the second time in a year, changes have been
made to the record keeping requirements for
employers.
Following an uproar from employers
about the stringent and onerous record keeping
provisions in the original WorkChoices
amendment, the Government granted a 12-month
amnesty for employers to put compliant record
keeping procedures in place. The Government then
changed the requirements to make them less
onerous. That amnesty ran out on 27 March 2007.
So, from now on, the records employers need
to keep for all employees regardless of salary
are:
- the employer’s name;
- the employee’s name;
- the date of commencement of employment;
- the status of the employee (full time, part
time, casual etc.);
- if a penalty rate or overtime is paid, the
number of overtime hours and the start and
finish times on each day;
- if there is agreement to an averaging of
hours, a copy of that agreement;
- the rate of pay;
- the gross and net amounts and
any deductions;
- any allowances, bonuses, penalties or
loadings;
- leave accrued and taken;
- details of any leave the employee has agreed
to forego including a copy of that written
election;
- the superannuation fund and contribution
details;
- the termination of a worker’s employment
including the name of the person who terminated
the employee, how it took place and the
date.
These records must be kept for seven years.
The OWS is empowered to investigate breaches of
the record keeping provisions and can issue
infringement notices on the spot.
If you have any queries about the record
keeping provisions Ebsworth & Ebsworth can
assist you in understanding and ensuring
compliance.
| 
