Labor tables IR reform bill, pushing for multi-employer bargaining changes to boost worker wages

The federal government has introduced the first batch of its long-heralded industrial relations reforms into Parliament, tabling legislation that would allow the Fair Work Commission (FWC) to arbitrate disputes over flexible work, place new caps on rolling fixed-term contracts, and provide a “workable” system for multi-employer bargaining, among other significant changes.

Minister for Employment and Workplace Relations Tony Burke introduced the Fair Work Legislation Amendment (Secure Jobs, Better Pay) Bill 2022 in the Lower House on Thursday, following Labor’s commitment to rapidly chase the reform agenda established at the Jobs and Skills Summit.

Speaking to ABC RN, Burke said the bill included workplace reforms designed to accelerate wage growth, particularly among working women, after years of stagnation.

“Under the previous government wages were deliberately kept low and insecure work was encouraged,” he said.

“Labor is taking the opposite approach because we want to help workers get ahead.”

The bill seeks to enshrine flexible working arrangements across the economy by empowering the FWC to step in when employees and businesses reach a deadlock in negotiations.

Where those discussions come to a halt, the bill would allow the FWC “to make a variety of orders, including that the employer grant the request for flexible work arrangements, or make other changes to accommodate the employee’s circumstances”.

The proposed legislation aims to crack down on the use of employers continually retaining workers in fixed-term contracts instead of making them permanent employees.

“While fixed-term contracts continue to have a legitimate purpose, their ongoing use for some employees has become another form of insecure work,” the bill states.

It would seek to ban employers from offering more than two consecutive fixed-term contracts for the same role, and cap the maximum duration of each contract at two years.

Civil penalties would apply for companies that breach those new rules, the bill states.

Central to the legislation is a push to expand multi-employer bargaining, an initiative championed by Labor at the Jobs and Skills Summit.

Multi-employer bargaining allows workers across multiple similar companies to collectively negotiate, expanding the possibilities of an enterprise bargaining system that is costly and complex for small businesses and their employees to navigate alone.

“Increasing the accessibility of collective bargaining promotes the right to enjoyment of just and favourable conditions of work by enabling employees to leverage the collective power of multi-employer bargaining to secure safe, healthy and fair working conditions,” the bill states.

Multi-employer bargaining was supported by the Council of Small Business Organisations Australia (COSBOA) ahead of the Jobs and Skills Summit, which argued the current system is currently too onerous for many small businesses to engage with on their own.

COSBOA also called for such a system to be ‘opt-in’, meaning small businesses would not be compelled to negotiate with their employees should similar businesses band together for discussions with their workforces.

The move would also exclude those small businesses which opted out of the bargaining process from industrial action brought forward by employees covered in the new multi-employer agreements.

The bill provides for “basically for all the principles that COSBOA, the small business organisation, asked for,” Burke said.

“So it will be opt-in, there’s no industrial action there.”

The reform suite has been welcomed by the Australian Council of Trade Unions (ACTU), which partnered with COSBOA on a statement championing multi-employer bargaining ahead of the Jobs and Skills Summit.

“Clearly there’s a problem: when the economy’s good, workers don’t get pay rises, when the economy is bad, it’s the same thing,” ACTU secretary Sally McManus told ABC News Breakfast on Thursday.

The government will today introduce wide-ranging industrial relations legislation aimed at closing the gender pay gap, expanding multi-employer bargaining, and bringing in flexible rostering rights.

ACTU Secretary @sallymcmanus says the reforms must also help to raise wages. pic.twitter.com/sEGX3a9iEY

— News Breakfast (@BreakfastNews) October 26, 2022

Yet major business groups say the push for expanded multi-employer bargaining pathways could enmesh small employers in further time-consuming and costly negotiations.

“We are deeply concerned that the new system could see small businesses swept up in a complex system dominated by unions and lawyers, currently one large workplace could vote to pull smaller workplaces into an agreement,” Business Council chief executive Jennifer Westacott said Thursday.

More to come.