Hostility to test PM’s roundtable after Chalmers comments fuel fear of ‘protection racket’ for unions

The PM’s economic reform roundtable is spiralling toward bitter acrimony after business chiefs erupted over union ­attacks on employers that were legitimised by the Treasuer on Friday.

’The ACTU should be able to make their views public,’ said Treasurer Jim Chalmers on Friday. Picture: Tara Croser

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Anthony Albanese’s economic reform roundtable is spiralling towards bitter acrimony between unions and business amid private sector concerns that the federal government is running a “protection racket” for unions and devising policies that shield and expand their power.

As unions use Labor’s ­industrial relations laws to grow their influence across the ­economy and exert authority in the ballooning public service, business leaders erupted over union ­attacks on employers that were legitimised by Jim Chalmers on Friday.

Ahead of attending the Prime Minister’s roundtable next month, industry leaders representing the biggest employers, manufacturers, builders and small business rejected claims by ACTU secretary Sally McManus that “poor management performance” by employers was among the “most significant causes of slow productivity growth”.

Business chiefs believe Mr Albanese’s pledge to strike consensus positions on tax, productivity and growth reforms at the Canberra roundtable will be sabotaged by unions.

Murray Watt, left, chatting with ACTU Secretary Sally McManus, right, and TWU Secretary Michael Kaine in Sydney in 2024. Picture: Nikki Short / NewsWire

Industry bosses said IR laws and regulations backed by trade unions were crippling employers and raised concerns about union demands around artificial intelligence, four-day working weeks, higher wages with no productivity offsets and abolishing the Productivity Commission.

The Treasurer said on Friday: “I think the ACTU should be able to make their views public. I think it’s obvious that when it comes to decisions taken by managers and by boards and by others, ­obviously, that has implications for productivity.”

Amid business warnings that Labor’s IR laws are undermining productivity, The Australian can reveal Freedom of Information documents show former workplace relations minister Murray Watt, who shifted to the environment portfolio after the election, ignored advice from his then department against making a captain’s call in appointing industrial relations expert Mark Bray to co-author an “independent” statutory review into Labor’s IR laws.

FOI documents show that on three occasions between July and September last year, Senator Watt’s office was cautioned by the department about not acting as “the decision maker for the procurement process” and that doing so could carry “probity and reputational concerns” and potentially breach commonwealth procurement rules.

After the department failed through two procurement processes to find a university or research institute to lead the IR review, Senator Watt selected Alison Preston and Emeritus Professor Bray, who employers believed was not an impartial appointment given his previous commentary supporting unions and what they perceived as bias against business groups.

In a fourth departmental brief to Senator Watt in September, Workplace Relations Department officials said it was “likely that some stakeholders would disagree with Professor Bray’s commentary or may raise ­concerns about the impartiality of his consideration of the issues for review”.

After the draft Secure Jobs, Better Pay report was released in January, the ACTU praised the review for confirming “Labor’s IR reforms a success”. The final ­report was expected to be handed to government before March 31 but is yet to be tabled.

Quizzed in a Senate hearing in February about who appointed the IR experts, Senator Watt said he would need to check but his “recollection is that the two reviewers were recommended in some form, whether it be written or verbal … by the department”.

On the same day, Workplace Relations Department first ­assistant secretary Jody Anderson said: “They were chosen by the minister.”

Workplace Relations Minister Amanda Rishworth said the review was undertaken by leading industrial relations experts, independent of government.

“The interim report found that the Secure Jobs, Better Pay reforms are, on the whole, achieving the Australian government’s intent,” Ms Rishworth said. “The final review report is set to be tabled by early September.”

In April, The Australian revealed Senator Watt was informed by his department about “impartiality” concerns regarding his appointment of Mining and Energy Union boss Tony Maher – a close friend of Mr Albanese – to chair Safe Work Australia.

As some business figures who fear a repeat of the 2022 jobs and skills summit privately warn that the government is running a “protection racket” for unions, Ai Group chief executive Innes Willox said the ACTU had ­engaged in “yet another wild and baseless attack on all Australian employers (demonstrating) how detached from economic reality they really are”.

“Again they have chosen to mindlessly attack employers without suggesting anything meaningful to remove blockages to our lacklustre productivity performance which is costing workers thousands of dollars per year,” Mr Willox said.

“What the ACTU stubbornly refuses to recognise is that Australian employers are weighed down by ever-growing regulatory and compliance burdens which the ACTU has enthusiastically promoted over many decades. It is truly disturbing that all we have heard (from unions) in the lead-up to a productivity summit are calls for four-day weeks at the same pay, higher wages with no productivity offsets, a handbrake on the take-up of technology, the abolition of the Productivity Commission, and another mindless attack on employers.”

Australian Chamber of Commerce and Industry acting chief executive David Alexander accused the ACTU of “stooping to a new low with its generalised smear about Australian business managers”.

“Australia’s industrial relations laws are some of the most complex in the world, a nightmare for employers to deal with, so it takes some gall from the ACTU to now run down Australian managers who have to deal with that problem,” Mr Alexander said. “The unions blame everybody when it comes to low productivity because they don’t want to admit that things such as the fair work laws that they’ve constantly ­argued for have created a one-size-fits-all restrictive working environment.”

Council of Small Business ­Organisations Australia chair Matthew Addison said it would be disappointing if “these discussions decline to a blame game rather than a development of positive possibilities for true economic reform”. “Small business are inhibited by the multitudes of obligations and their limited capacity to comply,” Mr Addison said. “Time and resources only stretch so far.”

Business Council of Australia chief executive Bran Black said the ACTU attack was a “distraction tactic by unions”.

“Suggesting Australia’s productivity slump is due to bad ­management by businesses is misguided, untrue and just plain wrong,” Mr Black said.

“Our IR system is entirely out of balance and that’s a major factor contributing to our poor productivity growth.

“Business is coming to this roundtable in good faith. Australian businesses know engaging with their workforce is essential to implementing change, but they’re also crystal clear that our current IR framework is too ­restrictive.”