Paul Fletcher (Bradfield, Liberal Party, Shadow Minister for Government Services and the Digital Economy) Share this | Hansard source

This is a very bad bill, which will lead to more strikes and job losses, as we saw in the 1970s, and which will allow unions into small businesses that have never had to deal with them before. It will undermine competition so Australians have fewer choices but face higher costs or will force up prices and increase the cost of living and unfairly target small businesses because these changes will be complicated and expensive, and small businesses don't have human resources departments that can wade through complex changes. Business groups—small, medium and large—across Australia are united in their opposition to the changes, particularly to multi-employer bargaining. I want to highlight, in my contribution, several troubling aspects of this bill.

The first is multi-employer bargaining. Today, the single-interest employer authorisation bargaining stream is a voluntary process under which employers with a single interest, which is very tightly defined, can opt to make an application to the minister and the Fair Work Commission to bargain together. Labor's bill substantially changes this by making it compulsory and by significantly broadening the types of employers who fall under this stream and who may now be compelled to bargain together. Because Labor's bill retains the ability of employees to take industrial action, at the same time as allowing a broader range of employers to be compelled to bargain together, the bill significantly increases the risk of multisector industrial action.

Compelling a broad range of employers to bargain together will have a particularly devastating impact on small and medium businesses. It will require small-business owners, who almost always work in the business themselves, to spend a significant amount of time away from their work negotiating a joint bargaining position with the other employers, including those with fundamentally different businesses, and then negotiating with employee and union representatives, all of whom will have significantly more time to dedicate to this processes.

The outcome of the bargaining process will be a multi-employer agreement that will undoubtedly take a one-size-fits-all approach. It will not be relevant to the particular requirements of the business and will, therefore, cause operational difficulties in the future—for example, because of working hours or rosters that do not suit all businesses. A collective agreement which is ill-suited to the circumstances of a particular business will significantly constrain how the business owner can manage the business and, in turn, may very well threaten the viability of the business.

The bill also involves the imposition of significantly more red tape and regulatory burden on business, including small businesses. The changes to the rules regarding flexible working arrangements will be particularly burdensome. Under the Fair Work Act as it stands today, under section 65, an employee has the right to request flexible working arrangements. That's a perfectly sensible and desirable thing. The employer can only refuse if there are reasonable business grounds to do so. The employer must provide written reasons for the refusal and must respond within 21 days. There is no ability for an employee to contest the basis for the employer's refusal, but, of course, the employer must demonstrate reasonable business grounds.

Under the bill disputes over flexible work arrangement requests will be dealt with by the Fair Work Commission, which may resolve the dispute by arbitration and may make orders that an employer grant the employee's original request, or make other specified changes to the employee's working arrangements. This is a significant change and one that is unprecedented in Australia's workplace relations history. It effectively makes the Fair Work Commission the final decision-maker in how an employer manages their own workplace arrangements. This means that if an eligible worker requests flexible working hours or other arrangements, such as working from home, the employer will be legally bound to try to reach an agreement. The impact on all businesses—but in particular on small businesses which do not have the time, money or resources to deal with the change—is that employers are now going to have their working arrangements determined by a third party, the Fair Work Commission.

By giving the Fair Work Commission the power to make a binding decision, Labor is effectively making the Fair Work Commission a co-manager of any business which is subject to these provisions. This stands in sharp contrast to the much more sensible arrangements which apply today, under which the Fair Work Commission sets a safety net of minimum standards and ensures that parties comply with their obligations. The Fair Work Commission, under the arrangements that apply today, only acts as a final decision-maker when the parties have requested it to do so.

There are numerous other aspects of this bill that hand excessive powers to the unions and to the Fair Work Commission. Firstly, under this bill unions are able to compel employers to bargain. Today, unions cannot initiate bargaining without the agreement of the employer or after obtaining a majority support determination which proves that the majority of employees wish to commence bargaining. Under this bill, unions will be able to initiate bargaining automatically once a request to bargain has been sent to the employer, provided that the employer had been covered by an enterprise agreement that expired within the past five years, and the proposed agreement will replace the expired agreement; the making of the earlier agreement did not cause a single-interest employer authorisation to cease to operate; and the proposed agreement will cover the same or substantially the same group of employees as the earlier agreement.

Once a request has been made by the union, three important consequences flow. First, the employer is compelled to comply with good-faith bargaining obligations, which include, amongst other things, attending meetings at reasonable times, considering and responding to bargaining proposals in a timely manner and disclosing relevant information in a timely manner. No matter that the business may be pitching for the biggest contract it has ever had the opportunity to win, no matter that there may be significant sales opportunities which the business is seeking to win to build its prosperity and provide additional employment opportunities—you must now comply with the timetable set by the Fair Work Commission, which is not interested in any of those matters. And, as is characteristic of much of the rhetoric we hear from the Labor Party, the profitability of the business is just taken for granted. It's just assumed. It's not something that has to be worried about! All of the focus is on how the boundlessly deep pockets of employers should be opened and shaken out. It's perhaps not surprising that that is the perspective of most on the opposite side of this chamber, because most of their careers have been spent as union officials or shakedown merchants. That's the grim reality that underpins the Labor Party's approach to these matters.

The second consequence of one of these requests being made by a union is that compulsory arbitration is then available and that the employees can take protected industrial action. This change gives more power to the unions, including the power to initiate bargaining without demonstrating that the majority of employees wish to bargain, and that is a very troubling development.

Third, the way that things work today, parties cannot ordinarily apply to the commission seeking a binding decision on what terms should or should not be included in a collective agreement. But all that changes under Labor's bill. Under this bill, where there is 'no reasonable prospect of an agreement being reached', a bargaining representative—read 'union official'—is able to apply to the Fair Work Commission for an intractable bargaining declaration. Once such a declaration is made, the Fair Work Commission must either arbitrate the outstanding matters between the parties or provide the parties with a postdeclaration negotiating period to agree on terms, after which the Fair Work Commission must arbitrate the outstanding matters between the parties. So, for the first time under the Fair Work Act, we have the introduction of unilateral arbitration into enterprise bargaining—that is, a scenario where one party can effectively disagree to the claims made in bargaining and seek to have terms imposed on all parties by way of arbitration.

In the remaining time, I should also note that this bill abolishes the Australian Building and Construction Commission, which will expose many more businesses to the tender mercies of the CFMEU coming round with a few blokes who, when they're not involved in union matters, are enthusiastic bikies, carrying baseball bats and other means of persuasion which they are notorious for using. That is the grim reality. Sadly—it's no laughing matter—businesses around this country can expect the kind of thuggery and intimidation that the CFMEU is notorious for and this government is wilfully turning a blind eye to. This is a very bad bill, it is a retrograde step and it will take our economy backwards.

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