Was Julia rolled on the Fair Work Act?

A story doing the rounds today in the Business Spectator by Robert Gottliebsen suggests that the first round version of the Fair Work Act devised by Julia Gillard was n0t too bad and that businesses were relatively comforted by Julia’s assurances. 

She was then rolled by Greg Combet and other union-affilated ministers to alter certain provisions to reinforce the pro-union aspects of the legislation, plus meeting sundry other union requests.  As a result, the business community feels betrayed, as they had been lulled into a false sense of comfort by virtue of their inclusion in the consultation process.  I actually think that this has all been known for some time.

So what are the most egegrious provisions of the Fair Work Act?

  • Modern awards are increasing labour costs and removing flexibility.
  • The Natonal Employment Standards are overkill given modern awards.
  • The individual flexibility clauses in the modern awards are a joke (an outcome the unions intended) and there is no semblance of individual arrangements.
  • Multi-employer bargaining for the low paid is a worry and is likely to lead to unsustainable hikes in labour costs for industries employing low paid workers, such as in child care, aged care, retail, accommodation, fast food, restaurants, cleaning.
  • The current case for a revised form of equal pay for equal worth (gender equity) is another case of overkill and again runs the risk of leading to unsustainable increases in labour costs.  It is reminiscent of the profoundly non-market based idea of comparable worth.
  • There are problems with the unfair dismissal provisions and the supposed protection for small businesses if they use the Code.  The Code has had to be redrafted.  The numbers of claims is beginning to climb sharply and we are back to the days of employers paying walk-away money to rid themselves of nuisance employees, even if they have followed the letter of the law.
  • It is virtually impossible to have a collective agreement without union involvement, even in cases of extremely low unionisation (this is what they wanted)
  • The $26 increase (4.8%)  set by the Minimum Wage Panel of Fair Work Australia for the Federal Minimum Wage and all other award pay rates is being used as the (annual increase) base for all new agreement on which to build higher claims.  This is not surprising even if the 4.8% was in reality for 18 months.

There is a considerable lag between changing IR legislation and the labour market and economic consequences emerging, in part because there is a degree of grandfathering in relation to AWAs being allowed to continue until their expiry.  It will be a case of watch this space.

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34 Responses to Was Julia rolled on the Fair Work Act?

  1. Fleeced

    I dunno… I’m starting to wonder if these “leaks” aren’t from the Gillard camp to make her seem more fiscally conservative. That thought actually occurred to me after the maternity-leave leak, but I dismissed it on the grounds that most voters aren’t like me, and wouldn’t see it as a positive.

  2. Judith, both this and last comment indicate that, if anything, Gillard is more “on side” with with the centre Right than they knew. Both comments also indicates grounds on which Abbott could be criticised: for outdoing the government in a parental leave plan which is not really necessary, and abandoning all hope of IR reform in the foreseeable future.

    Yet Abbott’s policies are pretty much greeted here with brief disapproval and a shrug, it seems to me.

  3. DavidJ

    A deputy PM being pushed around by a junior minister makes her look very weak and malleable.

    Now that Gillard has made some specific denials, imagine if Oakes is given further confirmation that she really does hate mothers and old people.

  4. Butterfield, Bloomfeld % Bishop

    Judith,

    you may not be aware but the reduction in the number of awards came from EMPOYERS because they wanted less to understand.

    it is virtually impossible to have a CBA without union involved. how and what evidence do you have?

    you leave out all EBAS have to be signed off by employees. Unions cannot do it. different to Howard!

    your last point is impossible on current legislation!

  5. pedro

    “your last point is impossible on current legislation!”
    Ha ha ha

    “you may not be aware but the reduction in the number of awards came from EMPOYERS because they wanted less to understand.”
    Ummm, employers might have wanted a simpler system of awards, but they probably didn’t want stupidity.

  6. Judith Sloan

    Modern awards may have been supported by some employer groups eg. AIG and BCA but were in fact opposed by others. Of course, individual employers were never asked.

    It is a myth that (smaller) businesses were plagued by having to comply with a multiplicity of awards; many simply operated on common rule State awards that have now disappeared. And of course many only sort-of complied with awards and no one ever bothered them. This sort of harmless non-compliance is absolutely not allowed under the current laws, although it has to be admitted that WorkChoices paved the way on this aspect.

    And just because some employers may have wanted fewer and simpler awards does not mean that they are now happy with what they have got. Julia told them that they would not face higher costs but this is not the case, even if there are transtional arrangements. In any case, time marches on and the higher costs come into play. It has been a case of stiff cheddar.

    The modern awards are now a nice little earner for the employer groups as employers struggle to understand their new obligations and seek the paid assistance of the employer groups eg. AIG.

    The previous government had come to understand the danger of collapsing and streamlining the awards and hence never pressed the button to commence the process. The alternative was to allow the awards, all 4000 of them, to simply wither on the vine.

    No, all agreements under WorkChoices required a vote by workers.

    And, yes, unions are using (informally) the increase in the minimum wage as the base on which they are building their wage claims under agreements being negotiated – and why wouldn’t they? If you can $26 for nothing, then let’s start talking from that base.

  7. Butterfield, Bloomfeld % Bishop

    Pedro, what was the last point?
    ever heard of pattern bargaining?
    no didn’t think so.

    Actually it is a myth small and medium businesses didn’t want a reduction in awards.That is why their employer associations were calling for it.

    It wastes time having to call the association to find out each different award depending on the circumstances. On the contrary multiple awards like workchoices are a gift to employer associations.

    no most EBAs require employee approval. They cannot be approved by the Union(s).

    And no the increase in minimum wage cannot be used in the wage negotiations as it is pattern bargaining which is banned.
    CEOs and senior Management do use pattern bargaining to gain their increases though but they do not come under the law

  8. jtfsoon

    Homer you’re an idiot

    Employers would prefer to have *no* awards. what is your fricking point? that the ALP will have a higher probability of delivering this than the Libs?

  9. Butterfield, Bloomfeld % Bishop

    err genius Judith is making the point muliple awards are better than fewer.

    is this your Forrest impression?

  10. ken n

    “Actually it is a myth small and medium businesses didn’t want a reduction in awards.That is why their employer associations were calling for it.”

    Employer associations further their own interests. They do not take a vote of their membership on issues like this. Many of the changes were in the interests of the associations. Return of the IR Club.
    That’s a pity, because one of the great developments under a less regulated market (not just Work Choices, it started with Keating/Hawke) was the growing redundancy of employers’ groups.
    Responsibility for employee relations were being forced back onto the employers which was a very good thing.
    I wonder how long it will take to rediscover that?

  11. JC

    CEOs and senior Management do use pattern bargaining to gain their increases though but they do not come under the law

    Lord you’re a freaking moron. You’re stupider by the day. In fact your daily mission is to make an even stupider comment.

    You useless string of DNA. Pattern barginaing is the term used to define a method unions that live under legal protections apply to raise their members wages.

    last I looked CEO and sentio management are not part of a union, you idiot, so the term has as much relevance as your brain functions to that of an average human being.

    Just go away.

  12. Butterfield, Bloomfeld % Bishop

    No Stupid Pattern bargaining is using a wage rise in another industry to justify a wage rise in yours.

    This is exactly how CEOs and the like justify their pay rises.

    1 millionth example of Forrest stupidity and ignorance

  13. JC

    Homer:

    You’re basically describing the process humans apply in price discovery you nimrod.

    pattern bargaining refers to unions in the process of collective bargaining for their members and even that is price discovery.

    Frankly if there were no protections for unions it shouldn’t be a problem they’re also using market information too.

    I really don’t understand your point other than it’s totally stupid and completely irrelevant.

    Go away.

  14. jtfsoon

    #

    No Stupid Pattern bargaining is using a wage rise in another industry to justify a wage rise in yours.

    That’s what anybody with an ounce of brains negotiating for a job in a similar position might try to do.

    God Homer your understanding of labour economics is as woeful as just about everything else you pontificate on.

  15. JC

    Homer’s all for price discovery with government assistance when it helps him find a few gallons of petrol for 2 cents less and 3 bananas 5 cents cheaper through a government website though.

    He’s all for price discovery then.

    As for CEO’s and senior managers? No they should be banned from picking up their competitors annual report and checking out what other dudes get.

    You blockhead Homer. You total blockhead.

  16. Butterfield, Bloomfeld % Bishop

    Just to enlighten you two Geniuses.
    Pattern bargaining is not allowed in wage negotiations.

    a wage rise is determined by the health of the enterprise the employees are in.

    Stupid and ignorant well done Statman you are Forrest’s brother and your understanding of the IR laws is as good as his.

  17. .

    “That’s what anybody with an ounce of brains negotiating for a job in a similar position might try to do.”

    Que; derived demand, opportunity cost, hygene wages, human capital, costs of hiring, etc…

    Homer’s like Scotty.

    “Homer doesn’t know! Homer doesn’t know!”

    It could be the economist’s anthem.

  18. JC

    Yes we know it’s not allowed Homer. Or rather, they can pretend to stop people from looking over to the other side of the street and preventing them from figuring out relativity.

    Go away.

  19. pedro

    “Just to enlighten you two Geniuses.
    Pattern bargaining is not allowed in wage negotiations.”

    Yeah, so it’ll never happen ever.

  20. rog

    JC confuses wages with salaries but so what? his observations are not relevant as he hasnt worked for years, if ever

  21. .

    rog – most people effectively have a combination of both.

  22. JC

    Wodgie:

    I do work. You used to before 2008, right?

    Wages and salaries when discussed in a general economics discussion are basically the same thing. It’s an exchange with one side being services.

    CEOs, senior managers down to janitor are all exchanging labor services for compensation you nimrod.

    Please go away.

  23. rog

    I knew that you couldnt tell the difference – and you just proved it.

  24. JC

    Run along wodgie. Geoffrey’s getting frisky.

  25. .

    “I knew that you couldnt tell the difference – and you just proved it.”

    Umm yeah sure. JC failed high school commerce because he uses a more general definton of factor payments (like actual economists do…)to labour than the year 9 textbook does….and he doesn’t know what a dictionary is.

  26. Butterfield, Bloomfeld % Bishop

    no it is you lot who have no idea of what negotiation is like in an EBA nor have you any idea of history.
    1979/80 was the golden age of pattern bargaining.

    Don’t know what pattern bargaining is, don’t know what EBA’s are ( No Judith ONLY employees can approve an EBA. This was a Gillard change from Howard).

  27. .

    ‘ONLY employees can approve an EBA’

    An interestng theory Homer if an employee was previously on an indvidual agreement and liked it.

  28. .

    Change? What change?

    From http://www.fwa.gov.au

    “Who can make an enterprise agreement?
    An enterprise agreement is made between one or more employers and:

    employees and
    (in the case of greenfields agreements) one or more relevant employee organisations (unions).”

  29. Butterfield, Bloomfeld % Bishop

    err Marky do you understand what an EBA is.

    An employee is not forced into an EBA.
    the employees that like individual agreements are management types.
    guess why

    Try and read but just to help out a Union can negotiate an EBA but only employees can approve it.
    They vote against it is toast.

  30. .

    You truly are a stupid man.

    What if some of the employees don’t like the EBA? What can they do now?

    “Oh no they’ll all vote for the agreement ‘cept management types…”

    Do you realise managers are generally employees in large orgs where EBAs are useful?

  31. Butterfield, Bloomfeld % Bishop

    oh genius.If they do not like it they vote it down.
    duh.

    gee you couldn’t guess why

  32. .

    You really are a truly stupid man.

    You can be forced onto an EBA by other employees and a union you’re not a member of with NO recourse to an indvdual conmtract.

  33. Rococo Liberal

    When Tony gets in he doesn’t have to reform IR. All he has to do is pass a law that the unions cannot give any money to a political party unless 100% of the members of the union approve in a secret ballot. It’s time the ALP had its funds cut off. The cunts deserve to shrivel up and die.

  34. Butterfield, Bloomfeld % Bishop

    Marky the only people who like individual contracts are management.
    They are the only ones that gained from them.Others did not.

    Mining is a good example actually.

    you can only be ‘forced’ if the majority of employees want it that way.

    Fancy that

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