Coronavirus: Industrial relations wish lists aired amid warning

Treasury has warned employers and unions that the economy could take five to seven years to recover­ from the COVID-19 pandemic­.

ACTU president Michele O’Neil at the roundtable in Sydney to map out an industrial relations reform working group process. Picture: AAP

Treasury has warned employers and unions that the economy could take five to seven years to recover­ from the COVID-19 pandemic­, as the government kicked off attempts to reach a consensu­s on workplace relations changes to help create jobs in hard-hit industries.

Sources said Treasury secret­ary Steven Kennedy gave a downbeat assessment of the economic outlook at the first meeting of union and employer represent­atives in Sydney on Wednesday, ahead of months of talks to try to get agreement on industrial relations changes.

They said Mr Kennedy told the meeting that it would take five to seven years to “bring back” the economy, and the unemployment rate would be between 8 and 9 per cent next year.

Attorney-General and Industrial Relations Minister Christian Porter said Australia was “facing the greatest economic challenge outside of a world war”.

“The purpose of the process is to try and change what have been longstanding policy settings and problems which we see as inhibiting job growth at a time where Australia needs job growth more than it has ever needed job growth in the modern era,” he said after the meeting.

Awards covering workers in the retail, restaurant, hospitality and tourism sectors will be the focus of attempts to simplify the award system, while unions said they were prepared to listen to employe­r concerns about the bargaini­ng system, provided workers also got improvements.

Mr Porter said the negotiations would concentrate on a “discrete, small number of awards in the industries­ where there has been the greatest damage wrought by COVID-19 and the necessary health responses”.

ACTU secretary Sally McMan­us, who arrived with ACTU president Michele O’Neil, said unions had two clear objectives from the process: fair pay rises and addressing work insecurity.

Ms McManus said unions would listen to employer concerns about the Fair Work Act’s better-off-overall test but would also push for increased rights to pursue sector­-wide bargaining.

Business Council of Australia chief executive Jennifer Westacott said unions and employers acknowledged the better-off-overall test was not working well. She said business was willing to make concession­s during the process.

Australian Industry Group chief executive Innes Willox said while it was sensible to look at a few awards in distressed industries, broader chang­es to the Fair Work Act’s award-making provis­ions had to be addressed.

“Many subject matters current­ly dealt with in awards are also dealt with in the Fair Work Act,” Mr Willox said. “Consideration needs to be given to whether a simple­r system could be achieved for all parties by removing various matters from awards and dealing with them entirely in the act. Annua­l leave is a good example.

“Changes are also required to the annualised salary provisions … The way that the Fair Work Commission has interpreted and applied these provisions has led to the loss of a lot of important flexibility for employers and employees in the 20 awards that contain annualised salary clauses.”

Australian Chamber of Commerce and Industry chief executive James Pearson said the ACCI strongly supported a re-examination of modern awards forming a central part of the review process.

“Employers and unions have spent 10 years continuously making and reviewing awards under the Gillard-era legislation, but with little to show for it in terms of making it easier to run a business or hire more people,” he said.

“Awards remain highly complex, confusing documents which are too hard to get right and too easy to get wrong, especially for people running small businesses who do not have the resources to navigate them.

“We expect the discussion to focus on awards in our hardest-hit sectors, including retail, restaur­ants and hospitality, and agree that they are a great starting point, similar to how our successful ­temporary award variations negotiations were laid out.’’