Labor’s IR policy revealed

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The Federal Opposition has finally unveiled its draft industrial relations plans ahead of the election, and business had better be prepared for significant change. By PETER VITALE of VECCI.

The Federal Opposition has released its draft industrial relations policy for the upcoming federal election. The policy will be voted on at Labor’s National Conference in late April.

The policy, if implemented, will represent a significant re-regulation of the labour market, particularly given the impact of the Howard Government’s WorkChoices legislation and companies can expect compliance costs to rise.

The Opposition’s draft policy is substantially the same as the policy platform adopted for the 2004 federal election and has managed to attract criticism from several quarters.

While deputy Labor leader Julia Gillard is working on the detail of the election policy, the ACTU has made it clear that it will oppose any compromise on the re-introduction of unfair dismissal laws that apply to businesses of all sizes.

For business, the news is essentially a return to the pre-WorkChoices industrial regime, with the addition of some Labor policy imperatives.

Key features of the ALP’s policy are:

  • Expanding the range of safety net of award terms and conditions and putting pay and award determination back in the hands of the Australian Industrial Relations Commission.
  • Abolishing AWAs, making a collective bargain the only means for business to legitimately introduce flexibility in key areas, such as hours of work.
  • A suggestion that a “good faith bargaining” regime will be introduced.
  • Reintroducing the “no disadvantage test”, when compared to award standards, for agreements.
  • Enhancing the rights of unions in workplaces, presumably in relation to site access and rights of representation of employees and allowing “pattern bargaining” across industries.
  • Reintroducing access to unfair dismissal laws for the majority of employees now excluded by WorkChoices. There has not yet been any indication of whether Labor will retain a small business exemption of any kind. As indicated earlier, the ACTU has already indicated its opposition to such a measure.
  • Expanding the scope of industrial relations regulation to cover groups who are now classified as independent contractors. It is not yet clear how far this aspect of the policy will reach.

Overall for business, the ALP’s policy suggests a return to familiar territory.

As has been discovered with WorkChoices, the devil is absolutely in the detail.

The Opposition would apparently use the full scope of the corporations power, highlighted by the High Court in the challenge to the WorkChoices legislation.

This means that the scope for a return to comprehensive state-based systems is probably limited. Further, with state Labor governments across Australia, a full referral of industrial powers to the Commonwealth, based on the Victorian model, is politically a more realistic proposition. Business will welcome that prospect.

There is however little doubt that the compliance burden will increase for small business.

The prospect of good faith enterprise bargaining, a legal concept recognised in the United States, is likely to add a layer of significant complexity to negotiation of agreements.

The re-expansion of the unfair dismissal jurisdiction is also unlikely to be welcomed by business. What remains to be seen is whether the changes proposed by the Opposition will result in a gentle swing of the regulatory pendulum or a return to a much more litigious and adversarial-based system.

The lessons for business? Hold your breath. The ALP in government will need a lot of legislative skill to get the balance right between its policy agenda and the stake that business now has in Howard’s 10-year legislative program.


Peter Vitale is a solicitor, the General Manager of Workplace Relations Services at VECCI and a principal at CCI Victoria Legal.


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