The word “productivity” didn’t make it into Bill Shorten’s press release yesterday announcing a review of the Fair Work Act, or into the terms of reference. There is no one from business on the panel and nothing in the terms of reference about asking businesses whether the act is working for them.
It is, in short, a whitewash — the review you have when you don’t want to have a review. What’s more, the new minister for workplace relations and former union leader went one step further than the old principle of never announcing an inquiry unless you already know the result: he actually laid out the result in the press release.
It is that the act “works well”. He said: “The Fair Work Act underlines a balanced system for good workplace relations — one that promotes national economic prosperity and social inclusion for all Australians. Real economic prosperity and growth requires fairness and security in the workplace.” There you have it Messrs Moore, McCallum and Edwards, work backwards from that.
The review is not meant to look at whether Australia’s current IR laws are working or not, it is merely the reluctant fulfilment of a commitment to review the act after two years that had to be made because the then minister, Julia Gillard, exempted the act from the usual regulatory impact statement at the drafting stage.
The word “productivity” does appear a few times in the act, including in its objectives, so the review panel will have to at least pay some deference to it. But there is no one from business on the panel and the list of bodies from which evidence will be taken does not include the Productivity Commission.
The fact that Australia’s industrial relations system is divorced from reality was well demonstrated by Bill Shorten’s third press release as minister, commenting on the resolution of Qantas’ dispute with its engineers this week. “It … reflects the flexibility of the provisions in the Fair Work Act that allow the parties to engage in meaningful conciliation.”
Sure it does — after months of damaging industrial action, followed by a lock-out of all staff and grounding of the airline’s entire fleet at huge expense and damage to the company’s brand and then the referring of the dispute to compulsory arbitration.
His first press release expressed pleasure that WA stevedore POAGS had cancelled its lock-out and the parties were in four weeks of conciliation before Fair Work Australia.
The spate of lock-outs makes it clear that the Fair Work Act does not actually meet its first objective, which is to provide laws “that are fair to working Australians, are flexible for businesses, promote productivity and economic growth for Australia’s future economic prosperity …”
What it does is entrench the position of unions and prevent businesses from negotiating directly with employees as an alternative.
So when a union won’t budge, the only alternative is to lock out the staff — that is, for the business to go on strike — and thereby bring in the umpire. This is not a flexible system that promotes productivity.
Over the past two years, Australian business owners and managers have been getting increasingly frustrated with the way the system works.
Big businesses have much less flexibility thanks to union power over entry into the workplace and compulsory bargaining, and the low thresholds they have to meet to start a strike or work ban.
Small businesses are being hit by higher costs, such as loadings, penalty rates, overtime and casual rates; they are being forced to pay wage rises that are greater than the price rises they can get; and there is now a lack of flexibility in rostering and dismissal.
The Fair Work Act is all about empowering unions and is a nightmare for businesses, large and small. But the panel won’t find that out.
*This article first appeared on Business Spectator
good one alan, just when it appeared that some of your articles had balance, you put on your union bashing hat once again
typical right wing rhetoric from you
all power to the bosses and none for the workers
you fail to comprehend that the right to withdraw ones labor is a basic human right
dont you understand that ?
ps try flying qantas and see what a disgrace that airline has become since alan joyce became ceo, and union hater leigh clifford became chairman ,it has got even worse than it was when geoff dixon in charge, something i did not think was possible
It’s always interesting to see an expert in one field stray into another. As bourne out by this piece, the expert relies on his comprehensive knowledge and experience in his expert field to hubristically give vent to things he really knows little about. A nightmare? Really? Is that why the Australian economy is in the state it’s in? Because of IR laws? Utter childish nonsense.
The phrase “prevent businesses from negotiating directly with employees as an alternative” displays at best a pollyanna-ish view of the relationship between labour and capital or outright ignorance and at worst simply vested or partisan interest. No one who saw and analysed how employees with the least bargaining power (women, casuals, retail and hospitality workers) were treated under Howard’s Work Choices would honestly put such an asinine position.
And “So when a union won’t budge, the only alternative is to lock out the staff ” is simply wrong. read the Act, Alan. No, it’s not simply wrong, it’s partisan and wrong.
For those who wish to look more closely at the fictitious link between giving bosses ‘flexibility’ through less labour regulation and productivity a short search of OECD databases will provide ample evidence that this position is indefensible. You could also look to McCallum, Peetz, Stewart, Buchanan AIER at Monash or any number of Australia academics.
If business wants productivity, instead of looking to cut cost by reducing wages and conditions (yes Virginia, that’s the definition of ‘flexibility’, maybe it could look at modernising the way they treat employees, more like adults and less like thieves. Maybe they could address the obscenity of executive salaries, maybe they could invest in training and R&D instead of coming rent-seeking to government.
What we have is a situation where the people who own capital want more of it and they will wail and berate and proclaim the end of the world if ever anybody restricts their ability to get more. The speculators and exploiters don’t care that the nation has other equally worthy, more pressing or just better goals than personal enrichment of a privileged few. They want their dough and they want yours too. How dare the government seek balance or seek to empower the relatively powerless!
So from one expert to another Alan, you stop making simplistic, patisan statements as if you knew what your talking about and I’ll abjure from giving financial analysis.
So, Alan Kohler finds it abhorrent that
1. Unionised businesses can’tnegotiating directly with employees as an alternative [as if they would negotiate otherwise];
2. Unions have a right of entry into the workplace [it is governed by the Act];
3. Big businesses have lost “flexibility” thanks to compulsory bargaining [much of the bargaining presently happening is at the end of the term of a previous agreement].
And he goes on….
Here are five alternative points for Alan Kohler:
1. Much of the research on productivity indicates better productivity where there is collective bargaining;
2. Collective bargaining is an internationally recognised right and a labour standard;
3. Collective bargaining and union representation are fundamentally democratic processes. They are not perfect and – as political representation is only as good as the people elected – some unions don’t do as well in exercising the rights as most of them do;
4. Some employers adopt their own form of militancy and a militant managerial ideology;
5. Why should the polity allow employers to exclude democratic processes once a worker enters the workplace?
Hear f%cking Hear Jim
Justice in the work place is a fundamental measure of our social development Alan Kohler and you seem to ignore it your above piece.
The race to the bottom promulgated by the hakenian conservatives, with a Tea Party appreciation of economics and social policy, has only been held in check momentarily by the Fair Work Act. At least we have it.
A true appreciation of our Productivity is, most of the low fruit has been picked, yet the national figures are still progressing. Granted a lot of it is on the mining Industry expansion, but they do reinforce an accumulation of positive productivity growth over many years.