Bosses resist pay deal axe warning

Employers are pushing back against the Albanese government scrapping their ability to get pay deals axed.

Workplace Relations Minister Tony Burke. Picture: Getty Images

Employers are pushing back against the Albanese government scrapping their ability to get pay deals axed, accusing unions of overblowing the issue and insisting there have been only a small number of applications by ­companies.

The government and unions accused employers of applying to axe agreements and then telling workers to accept a proposed agreement or risk getting a pay cut.

Workplace Relations Minister Tony Burke on Monday signalled that Labor would legislate to stop employers slashing wages by getting pay deals axed, slamming the tactic as a “rort” that is against the national interest.

Mr Burke said he was disgusted employers were even ­attempting the “heavy-handed” approach and that “on face value, I cannot see how this tactic can possibly be justified”.

The ability of employers to cut pay and conditions by applying to unilaterally terminate enterprise agreements will be on the agenda at September’s jobs summit when the government seeks a consensus between unions and business on how to fix the “broken” bargaining system.

Mr Burke’s comments, the strongest by the government on the issue, signal Labor will seek to scrap the unilateral termination provisions as part of a package of industrial relations changes to be introduced into federal parliament by the end of the year.

Australian Industry Group chief executive Innes Willox said the “union push” to amend the Fair Work Act to remove an employer’s ability to terminate an enterprise agreement misrepresented the facts.

“There are a very small number of cases where enterprise agreements have been terminated by the Fair Work Commission in contested proceedings but exceptional circumstances existed in each of these cases,” he said.

“There have been a few recent applications but it is not uncommon for applications to be withdrawn if agreement is reached with the relevant union/s on the terms of a new enterprise agreement. It is not an issue that requires amendment of the Fair Work Act.”

Mr Burke said on Monday that employers succeeding in getting enterprise agreements unilaterally terminated was “rare, but it’s something which I don’t think can be justified, and it’s threatened more often than it’s done”.

“And one of the ways it’s often threatened is to say to employees either vote for the agreement that’s on the table or you’ll get a pay cut,” he said.

“Now that shouldn’t be what people are weighing up when they vote for an agreement.

“It should be whether … the new agreement represents enough of an improvement is effectively what people should be weighing up, not be threatened ‘unless you do this, we’ve got a gun to your head and you’ll have a pay cut’.

“That’s not the way bargaining in good faith should happen.”

ACTU secretary Sally McManus said “using the threat of termination as a bargaining tactic is just unacceptable”.

“The law was never intended to operate this way and this loophole is being used and abused by bad employers,” she said.

Business Council chief executive Jennifer Westacott said “only the Fair Work Commission (can) terminate agreements and it applies a strict public interest test to ensure workers interests aren’t adversely impacted”.

Australian Chamber of Commerce and Industry chief executive Andrew McKellar said employers “recognise concerns have been expressed about a small minority of terminations of expired agreements”.

“A workable system needs to allow for the termination of out-of-term agree­ments that no longer provide a basis for productive, secure, well-remunerated jobs in 2022 and beyond,” Mr McKellar said.

Opposition employment spokeswoman Michaelia Cash said Mr Burke’s comments showed the Albanese government was “kowtowing to their paymaster in the unions and are giving into their ideological ­demands at the expense of employers and productivity”.