Business as usual up against plans for sweeping change

Labor and the Coalition are approaching the May 18 election with sharply contrasting workplace relations agendas.

Brendan O'Connor on the campaign trail in Box Hill, Melbourne. Picture Kym Smith

Brendan O’Connor is on the phone, ripping into employers critical of Labor’s sweeping workplace policy agenda.

“Maybe they should stop wearing sandwich boards and pretending the end is nigh,” he says. “We need some sensible engagement, not Chicken Littles, and, frankly, do you think you are going to get anything sensible from people who want the Liberals to win?”

O’Connor has flown into Gladstone, Queensland, for a fresh round of campaigning. Labor’s employment and workplace relations spokesman has been prominent, given the ALP’s focus on industrial relations and Bill Shorten’s declaration the election will be a referendum on wages.

Having given employers a whack, O’Connor offers an olive branch. “The employer bodies may not want us to win, but whatever they’re doing to campaign against us l’ll tell you this: we’ll work with employers in a co-operative and constructive way, and they’ll have a seat at the bargaining table,’’ he says.

“The difference between us and the government is workers will be at the bargaining table, as will employers, whereas workers are never at the table when it comes to this ideological, right-wing party.”

Shorten and O’Connor have faced scrutiny over Labor’s array of workplace proposals, while the Coalition has yet to make any significant industrial relations policy announcements in the campaign.

O’Connor and the union movement claim the Coalition is hiding its real workplace agenda and workers’ rights will come under attack if Scott Morrison wins. Jobs and Industrial Relations Minister Kelly O’Dwyer, who is leaving politics at the election, says the Coalition believes in “making sensible, practical reforms that improve the workplace”.

She adds: “We will continue to look at what changes are needed to happen to ensure we have collaborative workplaces that work for employers and employees.”

Drill into the detail and much of what the Coalition says it will pursue after the election are bills with an anti-union flavour that are already before parliament.

O’Dwyer commits a re-elected Coalition to trying to pass a bill that would lower the threshold for courts to deregister a union, permit courts to disqualify union officials if they commit two civil-law breaches, and subject union mergers to a public-interest test. Employers criticise the government’s failure to win passage for a bill to stop the merger of the construction and maritime unions.

It would press ahead with plans to weaken the financial position of unions by imposing regulatory controls on worker entitlement funds, denying unions an estim­ated $25 million a year. It would continue to try to legislate the right for casual workers to seek permanency after 12 months of regular and continuous employment. Labor and unions have criticised the bill, saying it allows employers to determine arbitrarily whether a worker is a casual rather than applying an objective test of casual work.

On wages growth, O’Dwyer says there is “no one silver bullet” to higher wages but maintains employment growth is a key way of ensuring pay increases. Asked if wages growth has been too low, she cites above-inflation increases in the minimum wage by the Fair Work Commission.

I ask O’Dwyer about comments by small business lobbyist Peter Strong, who says the penalty rate cuts have not created one extra job or prompted business to give workers extra hours. Wasn’t that one of the rationales for the cuts? “This is not a decision of the government. You can go to the (FWC) and you can ask them that question,’’ she says. Does the Coali­tion support the penalty rate cuts? “We have said these are independent decisions made by the Fair Work Commission and what Bill Shorten is proposing is for politicians to set people’s pay.”

But what is the government’s position on the matter? O’Dwyer says although the commonwealth presents cases and submissions to the commission, it would not create uncertainty for employers and employees by engaging in arbitrary interventions.

“It’s like you asking me what I think about rate rises by the Reserve Bank. Again, they’re independent decisions made by the Reserve Bank.”

So, the government is neutral on the cuts? “You can do the analysis, but I’m giving our position. The government isn’t interfering in the independent deci­sion-making of the Fair Work Commission and Labor (has) got a radically different approach.”

When I suggest O’Dwyer is outlining a business-as-usual approach to workplace relations, she says again she will leave the analysis to me. “It is a continuation largely of what we are doing as opposed to Labor’s radical change.”

The Coalition is keen to convince voters that Labor, at the behest of the ACTU, would pursue an extreme industrial relations agenda. If the ALP’s commitments are implemented, the rules of engagement between labour and capital will be rewritten, diminishing the bargaining power of employers and enhancing the influence of unions and workers.

“The difference between Labor and the Liberals is that Labor is not in denial that there are problems in the labour market,” O’Connor says. “The two key problems in the labour market go to questions around historic low wages growth and job insecurity. Because they are in denial about problems in the labour market and they have a callous disregard for working people and an enmity towards unions, they have no interest in fixing it.”

As well as reversing penalty rate cuts, Shorten has left open the idea of granting taxpayer-funded wage increases to “underpaid” aged-care workers from next year. But he had to contain demands for him to extend his $10 billion pre-election wage subsidy promise to childcare workers to other sectors.

After declaring on Monday that Labor had “picked childcare workers to go first”, Shorten moved to neutralise government attacks on ALP wages policy, insisting childcare was a “unique” sector and the funding model was a “template which we will only use in childcare”. But he left open the possibility of government-funded pay rises for aged-care workers after the aged-care royal commission makes its findings, scheduled for April 30 next year.

If Labor is elected, it’s increasingly clear it will pursue a first and second wave of workplace changes. Reversing the penalty rate cuts will be an immediate priority and O’Connor rejects retailer calls to phase in the increases.

Labor also has a suite of proposals it would seek to legislate this year, including changes to the provisions of the Fair Work Act it says have been used by employers to “game the system”. It would seek to restrict the ability of employers to terminate enterprise agreements and stop employers using a small number of workers to vote up a new agreement before applying that agreement to hundreds of employees in another workplace.

Labor also would try to legislate changes to pay equity provisions, a new definition of casual employment, and a “living wage” policy to apply to next year’s minimum wage review by the commission.

“There is no panacea, there is no magic wand to fix these issues,” O’Connor says. “It is a combination of reforms that will be required.” The second wave of changes is emerging, including a rewriting of labour hire laws, but Labor is committed to consulting with stakeholders for 12 to 18 months before introducing them.

Labor will delay giving trade unions the legal right to pursue multi-employer and industry-wide pay claims by at least a year, citing the complexity involved in rewriting the bargaining rules and the need to implement other parts of its workplace agenda first.

Senior ALP sources say the multi-employer bargaining proposal, the most contentious ele­ment of Labor’s workplace agen­da, has significant implications for key segments of the system including awards, enterprise bargaining, and the role and powers of the FWC. Sources say there is a need for extensive legal advice and consultation over proposed changes.

O’Connor declines to nominate a timeframe for introducing the changes. “We will need to consult, if we are elected, as we need to get it right,” he says.