Morrison Government’s new workplace agreement framework set to boost productivity and pay
Australia’s new system of enterprise bargaining is set to take inspiration from yesteryear, with the government saying the current set up is stifling wage growth.
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The Morrison Government will seize on Labor legend Paul Keating’s vision for enterprise bargaining as it tries to reform an overly complicated system it says is stifling wage growth.
Attorney-General and Industrial Relations Minister Christian Porter will on Wednesday unveil changes to the workplace agreement framework to help businesses and workers strike deals to boost productivity and pay.
At the centre of the overhaul is a streamlined “Better Off Overall Test” (BOOT) which could even be ignored in limited circumstances over the next two years as businesses recover from the COVID-19 crisis.
The government has already unveiled a raft of other reforms it will formally present in the omnibus bill to federal parliament this week.
Employers will be forced to offer some regular casual workers permanent roles and they will be able to offer part time workers extra hours as part of the proposed changes.
Wage theft would also become a criminal offence punishable with fines of up to $5.5 million if the laws are passed.
Amid mixed reactions from unions and business groups, the reforms will be dealt with at the start of 2021, setting the scene for a fight on industrial relations in what could be in an election year.
Mr Porter said the reforms aimed to make Australian Workplace Agreements beneficial for both workers and employers.
“This was Paul Keating’s vision when he launched the enterprise bargaining framework almost three decades ago,” Mr Porter said.
“Workers and employers would sit down and agree on ways to increase productivity in exchange for higher wages and better conditions.
“But in reality, the system has been slowly choked by increased technicality, complexity and regulation, leaving it almost unrecognisable today – so much so that many employers no longer even attempt to get agreements across the line.
“The government’s reforms aim to restore Keating’s vision by making the bargaining system easier to engage with, faster, more efficient and, most importantly, capable of delivering those twin goals of productivity growth and higher wages.”
A decade ago there were more than 25,000 federal enterprise agreements covering around 2.6 million employees – almost a quarter of the workforce.
By the middle of this year that had dropped to just 10,700 agreements covering 2.1 million workers – a fifth of the total workforce.
“This decline is bad for both employers and employees, as agreements are a proven way to deliver increased productivity and higher wages, which are key drivers of economic growth and job creation,” Mr Porter said.
Earnings for employees under an enterprise agreement were almost 40 per cent higher than those on awards according to 2018 data.
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