Coalition backdown on AWAs

The Coalition appears to have dropped its objection to Labor’s industrial relations legislation and it is now likely AWAs will be abolished once a Senate inquiry into the laws finishes in mid-April.

In a press conference held after lunchtime in Canberra today, Opposition workplace relations spokeswoman Julie Bishop said the Coalition now accepts that Labor’s IR laws “strike a fair balance between the interests of employers and employees”.

The shift will be seen as a backdown by the Coalition and a defeat for the workplace relations shadow minister, who has led a push within the Coalition to retain its commitment to AWAs.

But Bishop says the Coalition will seek to amend Labor’s legislation to extend the period of time its proposed individual statutory agreements will run, from two years to a maximum of five years.

Under Labor’s proposal, Individual Transitional Employment Agreements, or ITEAs, can be used to allow workers to stay on individual agreements until 31 December 2007.

According to Bishop, the new Coalition will now seek to amend the legislation so that ITEAs will reach their nominal expiry date five years after they are formed.

Bishop refused to elaborate on whether the Coalition is seeking to extend the period of time ITEAs can be entered into beyond the end of 2009, but her comments suggest ITEAs agreed before that time will continue to operate for a five year period.

That could mean employees on ITEAs could stay on the agreements until as late as 2014.

Bishop was also unclear about whether the Coalition will block the legislation in the Senate if Labor refuses to accept the Coalition change.

“If Labor doesn’t accept the amendment, we wouldn’t want to prevent the passage of the legislation through the House,” Bishop said in a press conference today. “You can have an expectation that there will be a similar position in the Senate.”

Even if Labor were to accept the amendment, it would represent a significant change from the AWA regime that existed both before and during WorkChoices.

Employers can only use ITEAs if they had staff employed on AWAs before 1 December 2007. Only new employees are eligible to go on AWAs.

The no-disadvantage test that applies to ITEAs is also significantly tougher than the old fairness test. It requires ITEAs not to disadvantage employees against an applicable collective agreement, while the old fairness test only required AWAs to be no worse than the relevant award.

For more on Labor’s IR changes, see Peter Vitale’s rundown on the laws and what they will mean for your business.