Government Heading Full Throttle into Work Reform

Maitland Mercury 30 May 2005

By Kellie Tranter

What is the real agenda? With its Senate majority the Federal Government has a fast car, an open road, no police……and three years to complete the ‘road trip’.

It is a long time since the Government has had an opportunity like this to implement major change, and it is going to use that opportunity in the industrial sphere.

Canberra wants the States to hand over their industrial relations powers. If they don’t – and you can bet they won’t – the Federal Government has said that it will use its corporations power to pass the necessary laws.  What the Government hasn’t said is that it needs specific powers under the Constitution to enact laws, so laws made under the corporations power cannot regulate employers who, for example, are sole traders or partnerships. So if the States fail to agree to the proposed ‘unified system’, the Federal Government will implement a ‘piecemeal’ system and some employers will be subject to the Federal System and others, like sole traders and partnerships, will be left in what remains of the State system.

If that happens the State Governments would not be able to implement any extensive industrial relations policies and would be hard pressed to afford the machinery required to handle claims for the employers who are left.

The State Governments will challenge the legislation in the High Court, not only to protect workers, as the Labor Government protest, but also to maintain their own power. It’s impossible at this stage to predict the outcome of a High Court challenge.

You will also have noticed the Federal Government’s interest in the “independent contractors”. If they can legislate to cover independent contractors then a lot of people will be removed from the industrial relations system.

It has been argued that the new system is dismantling the benefits of 150 years of collective bargaining by unions.

No doubt the Government and unions will remain divided over whether or not the new uniform industrial laws are coming after preliminary steps like the abolition of compulsory unionism, limitations on the power of unions in the workplace, the introduction of enterprise bargaining and workplace agreements and how these changes go hand-in-hand with the changes with the new Social Security system.

For now, the new industrial system may not result in any big changes to the way wages and benefits are paid to workers but in the long run it remains to be seen. We are really just following in the footsteps of the American system. It is foreseeable that a lot more workers will be casual or on short-term contracts.

There has been some suggestion that there will be a single basic wage that is kept very low and that rate will be paid unless there is a high demand for a particular skill at a particular time and place and that pay rates will effectively be unregulated: they will be set by individual employers without workers having the benefit of unions to argue for them, and the “agreement” will be registered by the Government without any scrutiny or supervision.

It is my view that we are moving into very interesting times.

It will be interesting to see what level of industrial unrest is generated, given the general shift in the personal focus of individuals on their financial circumstances and the dilution over the last 20 years of union power.