A year into the federal government’s workplace relations system, WorkChoices, and industrial relations is as contentious an issue as it has ever been. Tapping into the debate more recently is the Victorian state government, whose office of the Victorian Workplace Rights Advocate (VWRA) has announced an inquiry into the impact of WorkChoices on employees and employers in the Victorian retail and hospitality industries. This comes after an increase in complaints, reported by VWRA, relating mainly to the loss of entitlements (penalty rates), overtime payments and allowances in those industries.
The impact of the Workplace Relations Amendment (WorkChoices) Act 2005 (Cth) has been the focus of ongoing, nation-wide debate since the bulk of the legislation came into operation on 27 March 2006. With a federal election looming, the debate can only be expected to intensify.
The federal government points to employment growth, higher wages and increases in labour productivity across Australia as indicators of an effective workplace relations system. The successes attributed to WorkChoices are seen more specifically as a result of the relaxation of unfair dismissal laws, which were previously seen as barriers to employment, as well as the increase in the use of collective and individual agreements to replace awards as a common method of setting wages and conditions.
Meanwhile, opponents of the system cite the government’s own data, from the Office of the Employment Advocate (OEA), which last year revealed the loss of protected award conditions under the new system, including penalty rates, shift-work loadings and public holidays, which have been removed from many of the new Australian Workplace Agreements (AWAs). There are also concerns for the individual bargaining power of more vulnerable workers and for the capacity of workers to balance work and family life, both of which contribute to anxiety regarding job security.
Australia is indeed enjoying a period of employment growth. But while the government attributes this to WorkChoices, the opposition relates it to the country’s resources boom. Wage increases are another contentious issue. The government claims that pay rises are compensating for the loss of award conditions, while Labor reportedly argues that these pay rises are evident only in industries suffering labour shortages in the face of high demand. Low inflation figures might further suggest that despite increases in demand for workers, the price for their labour has not changed.
Analysing the impact of WorkChoices on real earnings is difficult to do without substantial data. The Australian Bureau of Statistics has released data indicating that female and part-time workers are earning less on AWAs than what they earned under collective agreements before WorkChoices. But in the absence of statistical analysis of current AWAs, any detailed assessment of earnings, employment conditions or the content of agreements can only be speculative.
The focus is therefore on anecdotal evidence from independent groups such as the Human Rights and Equal Opportunity Commission (HREOC), which recently reported a 63 per cent increase in employment related complaints since the introduction of WorkChoices. This increase was not unexpected considering the loss of access to unfair dismissal remedies for many workers under the new legislation. Claims can now only be made if they fall within unlawful termination provisions, for example, termination for discriminatory reasons. Acknowledging the impact this might have on HREOC, the government increased their funding by $2 million over two years.
HREOC is not the only avenue for addressing grievances outside the unlawful termination jurisdiction. Last year, two Federal Court decisions allowed for employees to sue for breach of general company policy and for employer’s breach of contract before the commencement of the employment relationship.
The most important decision made since the legislation was effected has been the High Court’s ruling, late last year, which dismissed challenges made by the states and unions to the validity of the Workplace Relations Amendment Act.
With a 5-2 majority, the High Court upheld the WorkChoices legislation through a broad interpretation of the constitutional “corporations” power. The decision effectively endorsed the federal government’s power to regulate not only industrial relations but potentially other areas previously covered by state legislation.
With the power of the states having been referred to the federal government, the impact of the Victorian Workplace Rights Advocate inquiry is limited. It is, however, the first time an inquiry has targeted specific industries to evaluate the influence of WorkChoices on the industrial relations landscape. The findings of the Victorian inquiry are expected later in the year.
More information
From the LIV Bookshop
Bargaining Under Work Choices , by Iain Ross, John Trew, Tim Sharard, $50
Useful web links
For information about Australia’s workplace relations system visit www.workplace.gov.au
