JobMaker: PM to broker industrial relations deal on awards and greenfields agreements for SMEs

Prime Minister Scott Morrison will seek to broker a deal between businesses and the union movement to pursue wide-ranging and structural changes to Australia’s industrial relations system as part of his new JobMaker plan.

On the table is everything from simplifying modern awards, to enterprise agreements and wage theft, as the Morrison government pledges to turn the page on a bitter divide between business and unions that’s stalled reforms to the Fair Work Act for more than a decade.

It remains unclear how the latest process — outlined by the Prime Minister in a speech to the National Press Club on Tuesday — differs in substance from an existing review that’s seen Industrial Relations Minister Christian Porter undertake consultations over the last six months.

Nevertheless, Morrison will seek to capitalise on co-operation between unions and business groups fostered during the COVID-19 pandemic to usher in a new era of workplace relations in Australia.

“Everbody’s got to put their weapons down,” Morrison said on Tuesday.

“I think that’s what Australians demand.”

Morrison seeks IR peace deal

The Prime Minister denied any suggestion the consultation process was an opportunity to neutralise the trade union movement, and said the government would shelve (not abandon) its Ensuring Integrity Bill, which would create powers to de-register worker groups and has been criticised as “union busting”.

“Our current system is not fit for purpose, especially given the scale of the jobs challenge that we now face as a nation,” Morrison said.

“[It] has settled into a complacency of unions seeking marginal benefits and employers closing down risks, often by simply not employing anyone.

“The system has lost sight of its purpose to get the workplace settings right, so the enterprise — the business — can succeed, so everybody can fairly benefit from their efforts and their contributions.”

Under the plan, which alongside vocational training reform forms a pillar of Morrison’s JobMaker policy, Industrial Relations Minister Christian Porter will lead five working groups through a “time-bound” process, sitting employer groups, unions and the government around a table to nut-out prominent issues by September.

Hot button issues are likely to include the Fair Work Commission’s ‘better off overall test’ (BOOT) for enterprise agreements, the complexity of the modern awards system, the future of casual work, greenfields agreements for small businesses, and dealing with systemic wage theft.

Morrison said small business owners will get their chance to participate in the discussions directly.

“It will become apparent very quickly if progress is to be made; the working groups will either reach something approaching a consensus on issues — or they wont,” he said.

Morrison won’t prescribe IR changes, but will have final say

Minister Porter has already been canvassing workplace law changes for some time, and late last year released a discussion paper that called on unions and business groups to lay down arms.

Since then, calls for changes to the Fair Work Act, drafted in 2009, have intensified, particularly among business groups in the wake of a recent Federal Court decision about casual work.

Morrison was coy on what industrial relations reform should look like on Tuesday, saying agreement between unions and employer groups would be more sustainable than simply pursuing an “IR shopping list”.

“I want to see employers and employees sit down around a table talk about those very issues and find a way forward,” Morrison said.

“I’m not going to prescribe it for them. Whatever they agree is more likely to be sustained and maintained into the future.”

Despite this, the Prime Minister clarified the federal government will have the final say on any policies that emerge from the process, leaving the door open to taking the reigns if no agreement is reached.

In a statement on Tuesday afternoon, Australian Council of Trade Unions Secretary Sally McManus welcomed the withdrawal of the Ensuring Integrity Bill, saying it symbolised “politics of the past”.

“The ACTU will measure any changes to industrial relations law on the benchmarks of; will it give working people better job security, and will it lead to working people receiving their fair share of the country’s wealth?” McManus said.

“The work of job creating will involve much more than industrial law changes and we will continue to put forward ideas on how Australia can create good, secure jobs for workers.”

COSBOA: “Industrial war” if no agreement reached

The prospect of wide-ranging negotiations opens the door to reform, but Council of Small Business Organisations (COSBOA) chief executive Peter Strong, who has been called on by the government to participate in the working groups, says if no agreement is reached, “industrial warfare” could break out.

“There’s two choices here, we can either have consensus and changes that are needed, or we end up with industrial war,” Strong told SmartCompany.

“No one would win, we don’t want strikes and lawlessness … if employers go in and don’t want to move it won’t happen, it’s the same with the unions.”

Strong says there’s a third fissure in the discussions for small businesses, with the need to ensure big business voices don’t take over negotiations, delivering reforms which could make life harder for SMEs.

So what’s on the priority list for SMEs? Strong and small business ombudsman Kate Carnell, who will both be party to the talks, say simplification of the modern award system, including by creating a new Small Business Award, will be front of mind.

Morrison yesterday floated the possibility of greenfields agreements — where new businesses liaise directly with a union on workplace conditions before hiring workers — but small business advocates say a separate award would be more focused.

“The overly complex current system effectively forces small businesses to seek expensive legal advice to avoid the threat of significant penalties if they make a mistake,” Carnell said in a statement on Tuesday.

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