Brendan O'Connor (Gorton, Australian Labor Party, Shadow Minister for Employment and Workplace Relations) Share this | Link to this | Hansard source

I would like to return to the contribution I was making on this bill some time ago. In their policy document, the coalition said:

… unions can seek entry to a workplace if … the union is a bargaining representative seeking in good faith to make an agreement to apply in that workplace.

Yet, contrary to this very clear commitment, there is nothing in this bill that implements the government's pre-election promise. No clever wording or trick can hide the fact that the coalition said one thing before the election—in their policy document, no less—and now after the election they are doing the exact opposite.

The coalition also said they would adopt recommendation 35 of the expert panel, which provides Fair Work Australia with greater power to resolve disputes about the frequency of visits. Again, though, the coalition has mis-characterised, or deliberately ignored, a significant qualification that exists in the recommendation. The expert panel's recommendation provided that there must be a balance between the rights of unions to represent the members and the rights of employers to conduct their business. The government's inclusion of a provision that requires the Fair Work Commission to consider the 'combined impact on the employer's operations' is clearly intended to exclude all unions from a site if only one union or, indeed, one representative has been found to have entered too frequently. For the government, it is a case of punish one, punish all.

Furthermore, Labor has concerns about the invitation certificate process that the government is proposing. The government suggests that, if an employee would like his or her union to come to their workplace and they wish to remain anonymous, the union must apply to the Fair Work Commission to obtain an invitation certificate. Does the coalition honestly believe that, in a workplace with, say, 15 or fewer employees, an employer will not be able to find out who sought the union's presence?

Additionally, there are no provisions for the commission to deal with an application within an appropriate time frame, so entry for the purposes of holding discussions with employees about an immediate workplace issue can be unduly delayed and allow sufficient time for the issue or problem to be hidden.

Another of the government's mendacious claims is that employers have to pay for the cost of 'union boss joy-rides' to remote worksites. This is simply wrong. The coalition are not just misleading people here; they are wrong. What the coalition do not tell you is that employers are able to recover costs and are required to facilitate access only where agreement cannot be reached and where premises are not reasonably accessible by transport other than that provided by the employer, or where the nature of the premises means that the union is required to stay overnight and no accommodation other than that provided by the employer is reasonably available. Labor believes that Australian workers, regardless of the location of their workplace, have a right to union representation and that unions should have fair access to work sites.

For the reasons that I outlined previously and, indeed, in this morning's contribution, Labor opposes the Fair Work Amendment Bill 2014. We oppose this legislation because we will not stand idly by as the government goes after the employment conditions of Australian workers. We oppose this legislation because it is Labor, and only Labor, that always fights for the vulnerable and low-paid workers who cannot afford to have their conditions and pay cut by this government. For this reason, the opposition will seek to refer this bill to the Senate legislation committee for a thorough review to get to the bottom of these issues and establish the true intent and effect behind this government's reform. Finally, by way of amendment to the second reading motion, I move:

That all the words after “That” be omitted with a view to substituting the following words:

“the House declines to give the bill a second reading because of:

1.   the need to provide sufficient protections in Individual Flexibility Arrangements and the impact that losing protections will have on employees; and

2.   the Greenfield agreement making process being heavily skewed in favour of employers; and

3.   the provisions of the Bill undermine the right for Australian employees to be represented at work including a requirement that an employee tell their employer if they want to speak with a union; and

4.   the need for a full examination of all amendments within this Bill that may unfairly impact on employees.”

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

Is the amendment seconded?

Ed Husic (Chifley, Australian Labor Party, Shadow Parliamentary Secretary to the Shadow Treasurer) Share this | Link to this | Hansard source

I second the amendment.

Jane Prentice (Ryan, Liberal Party) Share this | Link to this | Hansard source

I rise today to speak on the Fair Work Amendment Bill 2014, recognising that the coalition government is yet again delivering on its election promises. Labor stands in this place today announcing that they will oppose this bill without even letting it go through to the Senate committee process. As the first government speaker on this bill I would like to start by responding to some of the comments made by the shadow minister. While it may come as a shock to those opposite, as they often forget their own election commitments, this bill seeks to deliver on some aspects of Labor's 2007 election policy, Forward with Fairness; specifically the introduction of right of entry provisions and individual flexibility arrangements and closing the strike first, talk later loophole. Labor's policy clearly stated that under Labor's system awards would provide the parameters within which flexibility arrangements could be made under an award flexibility clause. This could include matters such as rostering and hours of work and all-up rates of pay, provisions that certain award conditions may not apply where an employee is paid above a fixed percentage as set out in the award, and an arrangement to allow the employee to start and finish work early to allow them to collect their children from school without the employer paying additional penalty rates for the early start.

I would like to identify how non-threatening these proposed amendments are. Extending the termination period in the legislation from 28 days to 13 weeks replicates a decision of the Fair Work Commission that is already in place. It is already the case today that non-monetary benefits can apply subject to the better off overall test—this just clarifies its operation. As the lowest paid workers on modern awards can currently enter into an IFA, there is little reason to allow union bosses to stop higher paid workers on EBAs from being able to enter into an IFA. Allow me to be clear: this bill is in no way a return to policies of the past. It merely clarifies the operation of the IFAs that were in Labor's Fair Work Act and in Labor's policy taken to the 2007 election and strongly supported by the union movement. Julia Gillard herself stated in September 2009:

Fair Work, in complete contrast to Work Choices, allows for Individual Flexibility Arrangements (IFA) which ensure that employees are always better off overall against the underlying award or enterprise agreement. Individual Flexibility Arrangements are not individual statutory agreements.

It is a mystery why Labor is opposing this bill, especially in respect of right of entry and strike first, talk later, as in 2007 Julia Gillard stated:

We will make sure that current right of entry provisions stay. We understand that entering on the premises of an employer needs to happen in an orderly way. We will keep the right of entry provisions.

At the National Press Club debate on 8 November 2007 she adamantly stated that she was

… happy to do whatever you would like. If you'd like me to pledge to resign, sign a contract in blood, take a polygraph, bet my house on it, give you my mother as a hostage, whatever you'd like.

One of Julia Gillard's media releases stated:

We would not want to see changes to the right of entry systems that jeopardise work performance.

Another one said:

As of today—

28 August 2007—

federal Labor will maintain the existing right-of-entry rules without exception.

Kevin Rudd himself stated in April 2007:

Industrial disputes are serious. They hurt workers, they hurt businesses, they can hurt families and communities, and they certainly hurt the economy.

He said that employees 'will not be able to strike unless there has been genuine good faith bargaining.' So, it eludes me why Labor is opposing their own election commitments and undertakings. At the end of the day, it should not come as a surprise. They did it with the carbon tax and they are doing it again today. Those opposite have no shame when it comes to defying the trust of the Australian people. The coalition pledged to improve the fair work laws; specifically, greenfields agreements, union right of entry, individual flexibility arrangements and a number of other Fair Work Act Review Panel recommendations that were ignored by the previous government.

Before the election I was appointed as a member of the coalition's Australian Building and Construction Commission working group, charged with the task of examining the viability of re-establishing the ABCC. The working group was presented with clear evidence that aggressive and militant union behaviour is commonplace in the building and construction sector. Site shutdowns, illegal strike action and other industrial disruptions occur regularly. The CFMEU and other unions frequently use purported safety issues as an excuse for industrial action. Coercion of individuals and companies is a tool frequently used by the CFMEU and its officials. There is troubling evidence of increasing corruption and criminality in the construction industry. Key construction unions, particularly the CFMEU, behave as if they are above the law. For example, they routinely ignore return-to-work court orders. Through these practices, the CFMEU and other unions have substantial industrial power and leverage which they use to impose uneconomic and unreasonable employment terms on head contractors and, through them, on subcontractors and across the industry through pattern agreements. In addition, the unions exercise control over what would ordinarily be commercial decisions, such as which subcontractors a head contractor may use, and over detailed operational issues such as whether a site operates beyond core hours.

Union militancy in the construction sector has profound economic and social consequences. To a significant extent there is an environment of criminality and loss of respect for the rule of law. Subcontractors are often exposed to coercion from the CFMEU. In the Queensland Children's Hospital dispute, although subcontractors received cheques from the CFMEU, pursuant to court orders that they be compensated for their loss, the CFMEU intimidated a number of the subcontractors into not cashing those cheques. The unions' power has increased because, at the command of the unions, the Rudd-Gillard-Rudd government terminated the ABCC, which the Howard Government had established, replacing it with a much weaker agency, Fair Work Building and Construction. Under the Australian Building and Construction Commission productivity increased and there were average lower construction costs of 3.4 per cent, a 2.1 per cent increase in overall construction activity and an overall combined effect of $7.5 billion in increased living standards in current dollar terms.

I have had many constituents inform me of their run-ins with the CMFEU. Earlier last year a gentleman who owns a small earth-moving business in Brisbane explained to me how he is being shut out of potential contracts by the CFMEU as he refuses to sign their EBA and that he thus receives no contracts for city works, suffers continual disruption during jobs and has the unions dictating terms and controlling businesses and employee selection.

Mr Perrett interjecting—

The net financial losses relating to this exceed $500,000.

Another constituent of mine has expressed his concern over being bullied by the CFMEU into entering unfair EBAs now which will lock him into years of uneconomic and unreasonable workplace practice. The unions know that the coalition government is set on re-establishing the ABCC and is now bullying contractors into signing dishonourable EBAs before this legislation takes effect.

Constituents have contacted my office telling me they are shopfitters trying to work at the Indooroopilly Shopping Centre site in my electorate of Ryan. I note the member for Moreton did not exactly support those shopfitters at the time. They had tried to gain access to their sites and were stopped by the CFMEU picket line and told that if they did not have a union EBA they would not be working in the centre. They finally managed to get some workers onto the site; however, there was a line of unionists constantly watching and questioning their workers. The union again made it clear that if they did not enter into an EBA the work would stop.

The shopfitters then took to the local media. The Courier Mail also covered their plight in the weekend paper, stating:

Frightened “mum and dad” operators have revealed members of the CFMEU are using “safety concerns” to enter retail outlets, which have been handed over from developer Multiplex, so they can coerce the small operators into signing enterprise bargaining agreements and join the union. The issue hit breaking point last week when police were called to the shopping centre, which is undergoing a $450 million redevelopment, after about 200 members of the CFMEU launched an impromptu rally where they howled “go home scabs’’ at independent shopfitters.

My constituents say that shopfitters simply cannot afford to accommodate the unreasonable day-to-day demands of the union and unsustainable wage expectations. Time is critical on building sites; the contractor typically faces a hard deadline and must pay liquidated damages if they are late to complete the job. The unions exploited this fact in their industrial action, knowing that each day a site is shut down, the pressure is building on the contractor to cave in.

Unions also shut down sites for other reasons—for example, to divert workers to participate in marches, pickets and rallies. On 16 August 2013, five sites in Brisbane were shut down and up to 500 workers from these sites participated in a march through the Brisbane CBD. The trigger for this was that the Federal Court was about to hand down a decision concerning the conduct of the CFMEU official Bob Carnegie; despite it being a favourable decision for Bob Carnegie, they still went ahead with the strike.

It is also routine to shut down a site with a view to getting an outcome unrelated to the site. It can often be linked to negotiations concerning an EBA on another site or in other parts of the country. When a contractor had not signed an EBA with the CFMEU in Queensland, the CFMEU enforced a site shutdown, purportedly on safety grounds, at a site in Canberra.

The coalition ABCC working group heard troubling evidence about stop-work action taken at times of maximum economic and operational risks, such as during the middle of a concrete pour. A concrete pour on a floor had been half completed when the union called a stoppage. Workers left the site and the pour was interrupted before it was completed. This meant what had been done was wasted. On returning to work, the half-finished concrete pour had to be jackhammered out. They then repoured the concrete and, again, halfway through the pour a strike was called. This farcical effort cost the contractor $250,000 and several lost weeks.

A recent trend has been the practice of community pickets as a technique for unions to disclaim responsibility. The union claims that the pickets are made up of members of the community not affiliated with the union. This makes it difficult to impose fines on the union.

There is troubling evidence of increasing corruption and criminality in the construction industry. We learned through the ABCC working group that it is not uncommon for union officials to openly ask contractors and subcontractors for money. This can be disguised in many ways, including paying for goods and services supplied by the union at a very substantial overvalue, sponsorship of union picnic days, buying advertising space in union magazines and so on. In some cases, we were told, it is as brazen as a union official asking an employer for cash—'$10,000 in a brown paper bag to keep the peace'.

We heard repeated anecdotes that subcontractors will not be retained by head contractors unless they are on a CFMEU approved list. Head contractors told the working group that CFMEU approved subcontractors are usually considerably more expensive than others. Only the naive would not see the potential for money to be paid by a subcontractor to the union in such situations.

Contractors and subcontractors regularly find themselves in the position that they must agree to unsavoury demands from building unions or fail to win or hold business. This may require them to break the law; very frequently it requires them to violate good commercial and procurement practice. Such an environment corrodes respect for and compliance with the law. The Courier Mail reported that 'Master builders construction policy director told a three-hour parliamentary committee hearing into the changes yesterday that he estimated union misuse of the right of entry provisions was costing the industry millions of dollars.'

It is no secret that the unions have run amok all over the building and construction industry. It is time that the coalition government reversed Labor's weakening of the watchdog on the unions and gave power back to the industry to fairly and economically conduct its business.

I continue to hear from my constituents, small business owners, private contractors and sole traders that the unions are no longer standing up for the little guy and are instead exploiting the major companies and driving out the small independent competition. It is the coalition who is standing up for workers and small businesses. I commend this bill to the House.

Graham Perrett (Moreton, Australian Labor Party) Share this | Link to this | Hansard source

I rise today to speak on the government's Fair Work Amendment Bill 2014. I am happy to outline the many reservations I have about this horrible piece of legislation and I look forward to voting against it in due course.

The fair work laws introduced under the Labor government improved fairness in Australian workplaces, after John Howard's Work Choices attempted to dismantle the fabric of Australian society. I note that the two responsible ministers at the time were Mr Hockey and Mr Abbott; now Treasurer and Prime Minister implementing a budget that attempts to do much the same.

I was interested to hear the first speaker from those opposite, the member for Ryan, and the rank hypocrisy that was on display at the beginning of her speech, when she talked about the former Prime Minister Gillard's commitments before an election and the implementation of those commitments after, and how they changed. For that to happen a few days after the budget we received on Tuesday night is unbelievable. I do know a little bit about the construction industry. I do not hang around the shopping centre at Indooroopilly that the member for Ryan referred to, but I do know this: I have got three brothers that work in the building industry, and my brother-in-law, who has passed away, had a story to tell as well.

I know that not every single union member or every single construction worker is a saint. But equally, as I am sure the small business minister would attest, not every single small business operator or every construction company is a saint either. In fact, the unpaid money owed to workers in the construction industry has to be seen to be believed. It is nothing like retail or education or some of the other sectors of the community. The amount of workers who go without money because of sharp practice or fraud is a tragedy, since people—especially small businesses—can be left begging.

I know how significant health and safety is in the construction industry. I know this because my little brother saw two men killed standing literally right beside him. He was working on the construction of the additions to Twin Towns, when the crane collapsed right beside him. The counterweight actually hit my brother on the back. The physical damage was horrible, but the mental damage done to him took years to recover from. He is now back in the construction industry. So I know how important health and safety is. It is important that unions have the right to talk to people about the benefits of being in a union, because what unions bring to the table more than anything are health and safety concerns. The member for Ryan had just a one-line reference to it saying, 'Its so-called health and safety concerns.'

I worked in the education industry, and I was a union organiser. I remember going to schools and hearing about people not doing the right thing, which might lead to psychological stress or damage down the track. In the construction industry, if you take shortcuts with scaffolding people die. If you take shortcuts with health and safety walls collapse on people and kill them. The construction industry is not like other industries, where you can let things slide for a while and improve them in the long term. That is why the amendments in part 8 'Right of Entry' of schedule 1 are important.

I have been to schools where the only place I could interview somebody was in the office right next to the principal's office, often within earshot and with no door to be closed. At a school that was a bit of a pain and a problem, and we would arrange meetings afterwards. It would be like the Prime Minister saying to a chamber packed full of LNP members, 'Alright, I'd like anyone who has a concern about the budget to tell me what your concerns are.' The member for McMillan might speak up, because he is an independent thinker and is happy to speak up; the member for Leichhardt might do it; or even the member for Brisbane might speak up in public about what their concerns are about the budget. How about if they said, 'Well, how about we have one-on-one interviews?' The reality is that the amendment they are proposing in part 8 would be like having a one-on-one interview over behind Peta Credlin in the adviser's box, saying, 'Yeah, speak your mind freely,' however, it is right next to the Prime Minister's adviser. You need to have the opportunity to talk about health and safety in a safe place where you can speak up about health and safety, because health and safety costs money. That is the reality. The cowboy operators always scrimp on health and safety. That is how they undercut their competitors. It is not like in retail where you can be undercut by someone offering a product that is cheaper—unless it is stolen, of course—the reality is that the easiest way to save costs in the construction industry is by scrimping on health and safety, and that costs lives.

Our reforms ensured that workers could raise issues with union representatives in workplaces, giving them access to broader rights to flexible work arrangements, and to protect workers from arbitrary rostering changes, which are a big problem generally. The changes came from a long period of consultation that employers were involved in, a consultation in which the Labor government made concessions to their point of view—it was about balance. Allowing workers to talk to union representatives in their lunchrooms about safety or other issues is a basic right. That is where, rather than peeling off the people one by one, you are able to say, 'What are the group concerns? Can you speak freely and safely?' and then the union can normally facilitate acting on it. Requiring employers to consider the impact on workers' family and care responsibilities when they introduce major rostering changes is a reform that recognises that many workers have families to look after. Taking action against workplace bullying, a major cause of human misery and lost productivity in Australian workplaces, was also long overdue. These changes were a huge step towards making workplaces fairer.

What we now have before the House is a typical LNP attitude that proves once again that this government fundamentally does not understand workplace legislation, and does not have what it takes to protect Australian workers. Safe workplaces, I would suggest, are the bedrock of a strong civil society.

I believe that members of parliament represent communities, not an economy. We represent people and families, not economic commodities and units of production. Labor strongly opposes these amendments, which undermine the right to organise and be represented by a union, and which expand the use or scope of individual flexibility arrangements.

These decisions are giving people a sense that the coalition is running back into the arms of that harsh mistress called WorkChoices, an exhumed, mouldering beast arisen to Joe and Tony's post-budget apocalypse. The Abbott government made it clear where its priorities lie when, instead of announcing a jobs plan in the face of mounting job losses, it introduced legislation to cut the wages and conditions of Australian workers. It has also flagged that horrible policy where people under 30 would have six months basically to beg for money.

We know that the Liberals are waging a war on penalty rates. We know this from their submission to the Fair Work Commission and from comments from nearly everyone, from backbenchers right through to the Treasurer. It is always great when someone pulling in $400,000 a year talks about the excesses of a shift worker. I give it the same credence as Gina Rinehart's comments about African wages stealing Australian mining jobs—that is, none at all.

Low-paid workers in particular would be very vulnerable if the provisions of this bill were enacted by the parliament. Unless the government is going to implement in its entirety recommendation 9 of the expert panel, as it promised, we must conclude that it is the first step to open slather on cutting penalty rates and allowances for Australian workers—something that has been a part of the fabric of society since the Harvester decision, and before that, one could argue. I would contend that Australians simply cannot believe a word this government says about workplace relations. They are getting their agenda from the IPA, or someone even more extreme.

The Fair Work Amendment Bill provides for individual flexibility agreements that buy out overtime pay and penalty rates for zero financial compensation. The bill undermines a range of key rights at work, and it is an exercise in the government ticking off that pre-election wish list of some extreme people in the mining industry. The government is also letting employers dip their hands into the pockets of workers by cutting their entitlement to the payout of annual leave loading on termination, money that Australians have been entitled to for years and years—40 or 50 years, in fact.

Tony Abbott is giving the green light to employers to cut people's pay, under the guise of greater flexibility. The opposition does not consider it reasonable for workers to trade away significant amounts of their take-home pay for nonmonetary benefits. This is a blatant attempt to cut pay and conditions through individual contracts, and shows that the Abbott government does not understand the concerns of Australian workers, nor the Australian sense of a fair go.

If recommendation 9 is implemented low-paid workers are extremely vulnerable as this government opens the doors to a slather of cuts on penalty rates and allowances for Australian workers. Before the election Mr Abbott was only too happy to don a hard-hat and a hi-vis vest and probably go through an induction process and then stand alongside workers. But I do not think he ever really got past the entrance of most of these workplaces. Since he has become Prime Minister he seems to be interested only in sticking up for corporate Australia, which we saw in the budget the other night.

Australia is in the midst of a job-security crisis, as detailed in the budget papers, with thousands of workers losing their jobs and many others pushed into casual, insecure work—a new way of life for Australia. That is what the Abbott government should be focused on, not on making life tougher for people. Day after day we keep seeing the Abbott government trying to drive down wages, at a time when families can least afford it. Talking about people doing the heavy lifting: who is it? It is not the people on $200,000 a year, like parliamentarians. No, it is the poorest people in our society who have been asked to start the war on the so-called age of entitlement.

Now that the so-called wages blowout has been proven to be a lie, the Abbott government has fallen back on individual contracts, which were a hallmark of WorkChoices, the horrible child of the member for Mayo. This is all about cutting wages and diminishing conditions that Australian workers rely on in order to balance life and work. If this bill were enacted it would provide employers with the ability to set terms and conditions that will affect prospective employees, without those employees having a real voice. 'Unity is strength' is the reality of modern workplace relations. It always has been. The idea that good-faith bargaining plays a role in this process is simply wrong, particularly if we see this through the prism of the building industry, where I think over $1 billion in unpaid wages exists. And who misses out? The workers.

Labor fundamentally believes in freedom of association—that long history going back to the charters in the UK, or the Irish, or the Eureka Stockade. It exists in whatever you want to extract from Australian society, such as the Diggers in World War I who went on strike. We have always had this tradition of people banding together to look after their rights. It is the Australian way. We do strongly believe in freedom of association. The first speech from those opposite suggests that the LNP do not. It is our strongly held belief that employees should be free to join or not join a union, if they so wish. That is the reality.

In finishing I would like to mention a person I will call my brother-in-law, Michael Jenkins, my sister-in-law's partner of nearly 17 or 18 years. He passed away recently. He worked out at Cannington, a mine to the south of Mt Isa. The member for Ryan talked about the joy flights of union leaders. The reality is that effectively there is no way to get to Cannington unless you fly there in one of the employer funded planes. That is the case for many mining operations. There are no 747s landing there, so you need to be able to access employer flights. It is then perfectly appropriate that the employer seek the money back. That is the reality. I would hate for those opposite to mislead the parliament about this. Michael passed away recently. He was only a young man. We often had conversations about the stresses involved with the mining industry. I know Cannington reasonably well, and, unfortunately, during my time working in the mining industry there were fatalities there. These industries are not like working down at the local shop. If we are talking about construction, if we are talking about mining, I know from my own family experience—from people like Michael Jenkins and from my brother, Timothy Perrett—that too often people can die because of the workplaces they are in, and this legislation should be avoided at all costs.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

I thank the member for Moreton for his contribution and for sharing his story with us.

Peter Hendy (Eden-Monaro, Liberal Party) Share this | Link to this | Hansard source

I rise to support the Fair Work Amendment Bill 2014 and reject the opposition's amendment. This bill is part of our economic reform program as promised before the election and is also part of our jobs plan. I will have more to say about jobs later in this speech.

Members will know that I am a former chief executive of the Australian Chamber of Commerce and Industry. As such, I know a bit about the subject of the bill before the House. Industrial relations has been a fraught area of debate in the Australian polity for more than 100 years now. Despite our opponents' simplistic attempts to demonise our views on industrial relations, the fact is that our approach is to actually put in place an industrial relations framework that improves wages and terms and conditions over the long term. We want to boost the incomes of employees as well as employers. Our opponents say that we hate trade unions. That is not true. Many on our side of politics have been members of unions. I am particularly proud of the fact that my great-grandfather, William Hendy, was a founding member of the Queensland Teachers' Union and was one of the first general secretaries of the union in the late 1800s. The member for Moreton, who is just leaving the chamber, may be interested to know that, given his background in the education union.

Mr Champion interjecting—

The member for Wakefield is a member of the Shoppies, are you?

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

Yes.

Peter Hendy (Eden-Monaro, Liberal Party) Share this | Link to this | Hansard source

I have another particular family story to relate that is relevant. My late mother was a member of the Hardy family, and one of my Hardy ancestors is Harriet Hardy. That is not a name that is particularly known in the annals of history, but she was married to John Stuart Mill, one of the fathers of English liberalism. The fact that an ancestor of mine had such close links to liberalism's foundations is, of course, personally pleasing to me. However, I further note that John Stuart Mill recorded that his two greatest published works—that is, the books Principles of Political Economy and On Libertywere joint collaborations with his wife, despite the fact that her name was not recorded as joint author. So I could potentially claim that my ancestor was one of the mothers of English liberalism.

What has all that got to do with trade unions and industrial relations? It is that JS Mill's works from the mid-1800s—specifically, from the earliest days of liberalism—justified the legitimacy of labour unions in a capitalist system. I have always agreed with that. And indeed, it was the Liberal government of Sir George Reid here in Australia that actually established Australia's unique industrial relations system. It was not a Labor government, but a Liberal government, that did that. I have always argued that the Liberal party, as the creator of that system, has been best placed to ensure that the system is appropriately balanced between employees and employers.

It is a bit like a seesaw in a children's playground: if it is weighted too much one way, it simply does not work. The former Labor government massively weighted up the seesaw in favour of the trade union leadership. We need to re-weight the system—and this is what this bill starts to do. Why is this important? The reason is jobs. Recently we saw that the latest unemployment rate is 5.8 per cent. While not the best of news, it was an improvement from the six per cent earlier in the year. Indeed, it was an improvement on the 6.25 per cent forecast by the federal Treasury during the dying days of the Labor government. This is the economic legacy we were left and are now dealing with. When John Howard left office the unemployment rate was four per cent, and very soon after the 2007 election it fell slightly further, to 3.9 per cent. That was a magnificent effort that Prime Minister Howard and his Liberal and National Party team were able to deliver after inheriting from the Keating Labor government an unemployment rate of more than eight per cent in 1996. And it is very instructive, how many years it took—that is 12 years, to get to that 3.9 per cent figure.

Unemployment is an incredibly hard social problem to deal with; it takes years of effort. And now we have to again start a repair job after Labor has sent unemployment rising. This bill helps to deal with the problem. In the period that the now Leader of the Opposition was employment minister, the number of unemployed people increased by 80,000, and over the full six years of the Labor government the jobless queues grew by 200,000. Labor still do not recognise the destructiveness of their policies. The impact on small business has been particularly devastating. In my own electorate of Eden-Monaro, small business is the lifeblood of rural communities. As the minister at the table, the member for Dunkley, well knows, across the country the last six years saw some 3,000 fewer small businesses employing people. The overall result for small business has been staggering. Under Labor, 412,000 jobs were lost in small business.

Only the coalition has a credible plan to create jobs by getting the budget in order, getting regulation down and getting productivity up. As the minister stated in the second reading speech for this bill, this bill will deliver on key aspects of our election policy and does not go any further than that. Indeed, he said that on union workplace access, individual flexibility arrangements and the removal of the ability to strike first and talk later, we are actually delivering on specific policy commitments made by the Labor party prior to the 2007 election but that Labor deliberately broke. These changes are on top of the significant reforms contained in the Fair Work Registered Organisations Amendment Bill 2013 and the Building and Construction Industry (Improving Productivity) Bill 2013.

Indeed, we have a significant reform agenda. With respect to this current bill, I want to concentrate on the issue of individual flexibility arrangements. The bill introduces amendments to provide clarity and certainty for employees around the use of IFAs. IFAs are not some diabolical invention of the Liberal party. In fact, they were introduced by Labor—by Julia Gillard, no less—when she was workplace relations minister, with the intent of enabling employees and their employers to mutually agree on conditions that suit their needs while ensuring that employees are better off overall compared with their underpinning employment instrument.

The better off overall test was introduced with IFAs and we have no plans to change it. The Liberal Party's view is that IFAs ought to be an important option to enable employees to, for instance, manage their child care or other caring arrangements, to spend time with family or for other commitments. They are specific to the individual and are of benefit to them.

The amendments to IFAs in this bill are actually based on the Fair Work Act Review panel recommendations commissioned by the Rudd-Gillard-Rudd government. They also include further new safeguards to ensure that employees are better off. To be clear, the current IFA framework in the Fair Work Act will stay, with additional protections put in place.

As the minister has catalogued, this means that an employer cannot force an employee to sign an IFA or make it a condition of employment, that the employer must be better off overall than they would have been under the applicable modern award or enterprise agreement, and a worker must provide a statement to the employer saying that the IFA meets their genuine needs and that they are better off overall. The amendment will deliver on the promises made by Labor in 2007 and provide that IFAs may be made in relation to all of the matters currently prescribed in the model flexibility term, to the extent that those matters are covered in the agreement. This will ensure that workers have access to fair flexibility without a veto by union bosses.

Two further amendments recommended by the Fair Work Act Review panel will be made to provide clarity and certainty to both employers and employees. First, the unilateral termination period for IFAs made under enterprise agreements will be extended from 28 days to 13 weeks, consistent with the position of awards. The second amendment will confirm the existing position that the better off overall test for IFAs can be satisfied by exchanging monetary benefits for benefits that are not monetary. The amendment, combined with the government's new requirement for a statement in writing from the employee, will provide greater protection and certainty for all parties. These changes deserve to be passed. The Labor and the Greens have vowed to block them in the Senate. This is to deny the job-creating nature of these reforms. The Labor negativity is appalling when it is known that this opposition will cost jobs.

I want to particularly refer to Paul Howes and Martin Ferguson. Paul Howes, National Secretary of the Australian Workers Union, the AWU, has belled the cat on the opposition leader's negative strategy. As reported in The Sydney Morning Herald on 5 February this year, Mr Howes:

… criticised the industrial relations system for “dragging Australia down” and fired a broadside at “criminals” who betrayed the union movement and hijacked its agenda.

Australian Workers Union chief Paul Howes has called for a “grand compact” between business and unions to take the heat out of the industrial relations debate and admitted wages in some sectors had increased too quickly.

Mr Howes urged his comrades in the union movement to concede there had been a pattern of unsustainable wages growth in some sectors of the economy, adding “we could be pricing ourselves out of the market”.

He said "the leap-frog wage outcomes in the offshore sector, in particular, are not going to be sustainable for the long-term".

But he urged business to concede that on an economy wide basis, industrial disputes had fallen and wages growth had slowed.

  …   …   …

The union national secretary said the industrial relations see-saw in Australia, which has seen a range of legislative changes in the last decade and a half and contributed to a "perpetual instability" in the IR system.

"Some will tell you that our industrial relations system is dragging us down.

"And I won't be popular amongst my friends in the labour movement for saying this - but I agree," he said.

To be fair I think that Mr Howes might be holding a grudge with respect to the Leader of the Opposition over the knifing of Prime Minister Julia Gillard just weeks prior to the 2013 election. However, he made some sensible comments about Labor's dog-in-the-manger approach to industrial relations. Recently Martin Ferguson, the former Labor cabinet minister and, indeed most relevantly, a former president of the Australian Council of Trade Unions, had a lot to say about the bereft policies of the opposition. Martin Ferguson is a well-respected former Labor Party MP. He is not a member of the HR Nicholls Society. Again The Sydney Morning Herald reported on 28 February 2014 the following:

''High labour costs and low productivity are an unsustainable mix,'' Mr Ferguson said. ''And therefore elements of the Fair Work Act must be looked at.''

Mr Ferguson said the Coalition's plan to restore the Australian Building and Construction Commission should be seen as a step that would encourage investment in Australia.

''Rather than seeing the ABCC as a tool that allows one side to get an upper hand over the other in some never-ending ideological skirmish, it should be seen for what it was: a mechanism that holds both sides to account and which can help deliver projects on time and on budget,'' he said.

''As the son of a bricklayer, I know a thing or two about the building industry.

''But it is time that some in today's union leadership recognised that their members' long-term interests are aligned with their long-term job security.''

Labor's response was typical—to play the man. The member for Gorton simply dismissed these considered comments, saying that, 'Mr Ferguson had deserted the workers and joined the employers.' This is typical class warfare from the member for Gorton—an approach shared by the Leader of the Opposition.

I remind the House that, since the election, the Leader of the Opposition has done a deal with the trade union leadership to oppose the government's sensible reforms. In an article by Peter van Onselen in The Weekend Australian, on 9 November 2013, it was reported that during the Labor leadership campaign straight after the 2013 federal election:

In letters to union leaders he—

that is, the Leader of the Opposition—

reaffirmed his commitment to a host of policies that go further in unwinding bipartisan workplace reforms of the past two decades than the Fair Work Act did.

The Leader of the Opposition should release those letters so that the public is aware of his secret policies.

In conclusion, I strongly support this bill. It is a major economic reform bill that is a key part of our jobs plan. I reject the opposition's amendment and am saddened by the dog-in-the-manger attitude to such important reforms.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

This is a bill of broken commitments. After the budget, which was a budget of broken commitments, it is not surprising that this bill should come into the parliament. We all remember the Prime Minister saying on Melbourne radio that WorkChoices was 'dead, buried and cremated'. It was a full stop and another one of his great rhetorical commitments given to the Australian people in the last election. It is hard to keep track of them all—there were so many of them. He promised that WorkChoices was dead, but here is this bill in the parliament and it is a continuation of the Liberals' long war that the member for Eden-Monaro talked about, going way back to 1890. They have always been trying to get back to that point; it is their ideological starting point, when they had freedom of contract and they could push workers around. There was a series of strikes in the 1890s; workers lost all of them, but we won the moral battle.

That is why an arbitration power was inserted in our Constitution during the federation debates. People might have lost the war on the ground and they might have been pushed around by their employers, but they wanted our federation to have some fairness in it. Fairness begins at work and that is a principle that has always been present in our country.

There were also great ideological debates in the 1930s, when they tried to cut all wages and pensions by 10 per cent, in the 1960s and in 1992—I vividly remember that one of the reasons I joined the Labor Party was the prospect of $3 youth wages. The ALP's IR policy of the time said: 'We are going to basically have a brave new world. We are going to scrap every award across the country and workers will start again to negotiate for conditions that they had in the past.' All of that would have been swept away in the 1993 election if Hewson and Howard had had their way; workers would have had to start from year zero.

That is the point that this government wants to get us back to. What they intend to doing is not to bring the big bang; they are just going to cut it like you cut an onion—one slice at a time. That is their strategy. Nobody should be under any misapprehension about what this government intends to do. They intend to run austerity in the budget, even though they promised something otherwise; they intend to lift the GST, even though they say otherwise; and they intend to destroy the industrial relations fabric of this country. Once they have destroyed the sensible social fabric in this country and the Australian way—Medicare and the like—they will set out on a long ideological war to do the same thing in the workplace. Everything that makes Australia fair will be ripped away.

The people who will suffer most in this system—I have seen it, because I have been there—are people like cleaners, retail workers, trolley collectors, hospitality workers and the like. I remember in about 1994—when I was working as a trolley collector—there was the cleaners and caretakers award, which I was employed under. I did not get my penalty rate, which was one of the reasons I joined the SDA, but I at least got the award rate. Within a few years, those workers had slipped out of the award safety net through a legal technicality and their wages tumbled from $11 or $12 an hour to about $5 or $6 dollars an hour. It was still possible in South Australia a few years ago to find trolley collectors employed on $6 an hour. There were young people employed on miserable wages through a series of subcontractors in the retail sector.

That gives you some idea of what will happen if the award system goes and if those opposite get their way—that is freedom of contract. That is what happens. Even now, if you look at the Fair Work Ombudsman's website, you will find from time to time cases they have taken on to recover the wages of unpaid trolley collectors. It is people like that who suffer the most when we remove protections. Retail workers, hospitality workers, cleaners and people in the service sector are the ones who are the most vulnerable to wage reductions.

People in the building industry, who can and do organise to protect their wages can often withstand these periods of adversity during Liberal governments. But it is the people with the least protection—those who are the most unorganised and the most vulnerable—who suffer under the coalition. They have the most to fear from a return to WorkChoices, from a return to 1992 or a return to the 1890s. They do not have much protection, but they do have their votes. They have always expressed their displeasure at the ballot box about the type unfairness that those opposite are promoting.

The provisions of this act are presented an evolution, small steps and a little cut the onion—one slice at a time—and so they target things like right of entry in the workplace, but the whole of this act aims to stop unions from entering into workplaces, to stop workers from talking to unions and to stop workers from having the choice of joining a union.

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

It is to protect Joe McDonald; that is what it is about!

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

No, no. I worked in the cleaning industry. I got told, 'If you join a union, you get the sack.' That was what I was told, and a lot of people get told that. How would you protect them? How would you protect them, Member for Bass?

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

Joe McDonald.

Nick Champion (Wakefield, Australian Labor Party) Share this | Link to this | Hansard source

He does not give a fig about those people. He does not give a fig about their civil rights. They bring up the bogeyman—some bogeyman trade union official. We saw that in the ads in 2006 and 2007. Didn't work then. Won't work now. All this will do is restrict people's right to join a union because they will never, ever get to see the union. The union will never be allowed to be present on the work site. So you will have the freedom to join, but the union will not be able to do much for you. That is the aim of those opposite, and they get so upset when we say it in the parliament. There are all these cries of outrage from across the room.

It is the same thing with greenfields agreements. It sounds eminently fair. After three months, if the employer and the unions have not reached an agreement on a greenfields site, the employer can then apply to the commission to make an agreement with themselves. It sounds sort of fair: 'We don't want to stop development in this country,' so three months sounds fair enough. But I have dealt with situations where existing workforces have simply been moving from one suburb to the next, from one site to the next, and that has been the mechanism to invoke this greenfields clause in order to completely rewrite, or threaten to rewrite, the conditions of an existing workforce. That is what ends up happening. If you are in the building trade, mining or any of those sorts of industries where things start up and close down and start up and close down, then these provisions for greenfields agreements will be utilised to destroy longstanding conditions. Make no mistake: conditions that have been built up in this country over 100 years of progress, decency and bargaining will be stripped away overnight.

It is the same with individual flexibility agreements. The whole set of arrangements in this bill needs to be looked at very carefully, because those opposite are seeking to use a mechanism in the Fair Work Act to completely change its aim by the introduction of non-monetary benefits in exchange for your working conditions. We all know what that leads to in retail. I remember in the old days, when there used to be more DVD and video shops, you used to get two free DVDs at the end of the week. It will be the same here: say goodbye to your penalty rates. Those are the sorts of arrangements that get made—a bag of tomatoes or something in exchange for your penalty rates. They are the sorts of silly arrangements that get made when you do not have adequate protections. That is what this bill seeks to do. Individual flexibility agreements will become individual contracts.

That is the aim of those opposite. They should be fair dinkum, just once in their lives. For once in their lives, they should be fair dinkum with the Australian people. This has become the Liberal way, you see, since Fightback! They got such a scare when they were honest with people about what they believed in that they now obscure their aim. And anyone who opposes them is an infant, apparently. That is the new rhetoric: 'You've got to be an adult.' This is the ridiculous, bizarre spin that they come out with.

What else do we find in this bill? We find that, stashed away, there is a little sting in the tail for those on workers compensation, because the bill seeks to remove employees' ability to take annual leave while they are on workers compensation or awaiting the outcome of a workers compensation case. Now, that will put some people at a great deal of disadvantage. They will not be able to take their annual leave while they are waiting for their injury claims to be heard. Effectively, this will leave some people without income.

What else do we find in the bill? We find changes to annual leave loadings and shift loadings. Shift workers all over the country, people who regularly work late at night or on Sundays, get their shift loading when they go on annual leave because it is part of their normal income. But hidden away in this bill is this: if it is not in your award, if it is not expressly provided for in your agreement, out it goes. That is the first little slice of the onion towards removing those sorts of conditions—removing annual leave loading, which the coalition have been trying to get rid of since the seventies, and removing the right of shift workers to loadings when they are on annual leave which are part of their normal income. The reason those provisions were put in place was that often shift workers would work 50 weeks of the year, working nights and getting a shift loading of an extra 30 per cent, and when they went on holiday their income would actually drop. That is why those provisions were put in place—because of that blatant unfairness.

This is just the first wave of industrial relations changes. We know that, in the lead-up to the next election, if those opposite get away with this budget, if they are feeling confident, up the GST will go—if they can convince the premiers; it seems some of them are getting cold feet—either by broadening the base or lifting the rates, or both. Then we will see the inevitable industrial relations debate. They are before the Fair Work Commission today, trying to reduce people's penalty rates on the weekend, and the penalty they want on weekends is zero. It is not 50 per cent. It is not a reasonable rate. It is zero. It is a flat rate. That is what those opposite seek.

Those opposite should save us from their mendacity, from them breaking their commitments to the Australian people. This is a bit of an opportunity for those opposite, like the member for Bass, to just for once be clear, give a bit of straight talk and go to the ballot box with what you actually believe—rather than being this wolf in sheep's clothing, which is what they seek to do every time. It will save us from bills and budgets of broken commitments.

Andrew Nikolic (Bass, Liberal Party) Share this | Link to this | Hansard source

I welcome this opportunity to speak in support of this bill, to reject the opposition's amendment and to reinforce the coalition government's commitment to improve the Fair Work laws. How extraordinary to hear the first few Labor speakers on this bill oppose their own election commitments. The member for Wakefield talks about keeping your commitments. Well, this bill is about helping Labor keep its own commitments when it comes to this area. We heard the member for Wakefield, from the shoppies union, use the language of class warfare and division and, above all, protection of union interests, opposing amendments introduced by Labor itself. We should not be surprised, because Labor opposes many things now it previously supported. It reflects a disturbing lack of certainty and clarity at the leadership level of what was once a proud party.

This is a party that before the last election said it had 'terminated the carbon tax' yet now opposes our repeal of the carbon tax. This is a party that promised billions of dollars in savings at the last election yet now opposes in the Senate our efforts to make those very same savings. This is a party that trashes the reform legacy of Labor prime ministers Hawke and Keating in the industrial relations area. Hawke and Keating would never have been as captive to a union movement as the current members opposite are. Far from the proud legacy of Hawke and Keating, ALP leaders today embrace the Calwell-Whitlam legacy of economic ineptitude and subservience to union bosses. It is little wonder that the Australian people so comprehensively rejected such confusion and dysfunction at the last election.

I will say at the outset that greater investment and productive workplaces are the foundation on which our future prosperity will be built. It will not be built on the sort of divisive language we have heard from the former government in recent years, which frames the debate as a battle between rich and poor and an ideological struggle between capital and labour. Nothing could be further from the truth. Hawke and Keating never resorted to the cheap politics of division that those opposite engage in today. The whole billionaires-versus-battlers story that many members on the other side continue to peddle on a day-to-day basis has been rightly dismissed by the Australian people. The truth is that capital creates jobs, and the greatest power of business is its power to invest or disinvest. When it does invest, jobs are created, people earn income, they pay taxes, governments receive revenue and so the collective needs of our community can be funded. It is a golden thread of logic that no amount of socialist babble will change.

All members of this House should have a special and ongoing interest in the matter of work in general and the Fair Work Amendment Bill in particular. This is an important issue in my home state of Tasmania, which is blighted by unemployment as well as its invariable accomplice—underemployment. I use the language of crime deliberately because the effects of joblessness are like a criminal invasion of the psyche and wellbeing of those afflicted by it, all the time corroding individuals, families and even whole communities. Once this problem reaches the critical mass of intergenerational welfare dependency, it requires a near superhuman effort from government to turn that situation around. Tasmania, like other beleaguered parts of the nation—notably some in rural and regional Australia—includes depressed communities where unemployment directly affects 20 per cent, or more, of people. They are desperately seeking work.

The government's Fair Work Amendment Bill seeks not only to improve existing work conditions but also to play a critical role in encouraging long-term investment in Australia. It gives genuine substance to the coalition's proud claim that, 'Australia is once more open for business.' In supporting this bill my intention is threefold: firstly, to focus on the full spectrum of Australia's employment compact, and that includes employees, employers, and the legislative role and responsibilities of government; secondly, to highlight the key elements of this important bill; and, thirdly, to comment on the relationship between this proposal and the unacceptably high rate of unemployment in my home state of Tasmania.

It is all too easily forgotten that employment related policy and supporting legislation must balance and meet the needs of multiple and sometimes dissenting parties. The coalition's commitment to balance the rights, needs and requirements of both employees and employers represents both a challenge and our determination to do the right thing for all Australians. Refreshingly and perhaps uniquely, this amendment bill represents a case where the government and even key Labor luminaries find themselves in heated agreement with each other.

During a recent address to the National Press Club, the former head of the Australian Workers' Union, Paul Howes, spoke passionately about the inherent pointlessness of class warfare between unions and business, at various points calling for a 'grand compact' and 'gestures of compromise'. I welcome Mr Howes's outbreak of common sense. Mr Howes might also have borrowed thematically from the Fair Work Amendment Bill itself, because this bill practically enshrines legislation that will better protect the work rights and conditions of all Australians. Whether he knew it or not, Mr Howes's speech contained key elements of this amendment bill. I genuinely thank Paul Howes for his faith in the government and, unlike some of his Labor colleagues, we will not let him down.

What the coalition intends with the Fair Work Amendment Bill has never been a secret. We released our workplace relations policy well before the 2013 election in order to openly address key problems with the Fair Work laws. This bill implements the commitments we made in that policy. Contrast that approach with the Labor and Labor-Green governments from 2007 to 2013, which rolled back not only coalition IR policy but many of the sensible policies that former prime ministers Hawke and Keating introduced. This bill also delivers on specific promises made by the ALP themselves prior to the 2007 election, promises they subsequently broke.

I will now focus briefly on some key features of the bill. It provides more balanced workplace relations outcomes, which include the safeguarding and protection of workers' conditions. It prevents needless union vetoing of greenfields agreements. This will ensure that unions cannot use endless delays as bargaining chips which frustrate investment and risk our country's prosperity. This bill supports the establishment of a work environment and culture that encourages investment in new projects. It sends a strong message to investors that Australia is, once again, open for business. It ensures that bargaining must have commenced before strike action can be taken. This is in order to negate needless and costly industrial action. This also avoids waste and productivity impacts, which the government, like other sensible and fair-minded Australians, is not prepared to tolerate. It improves individual flexibility arrangements to enhance productivity and fairness by giving our workers a greater say personally in negotiating work arrangements with their employers. Everything we are doing on the issue of individual flexibility arrangements was recommended by the previous government's own Fair Work Act Review Panel and was clearly articulated in the coalition's election policy.

Indeed, this idea of the individual having distinctive rights has been one of the most fought over in our recent history. As long ago as 1996, Bob Hawke commented:

For its part, the trade union movement must recognise ... the right of an employer and an employee, freely, to enter into individual contracts underpinned by an independently determined safety net.

Julia Gillard promised prior to the 2007 election to sweep away all individual agreements, but then ultimately took a more pragmatic view in promising:

Under Labor's new collective enterprise bargaining system all collective agreements will be required to contain a flexibility clause which provides that an employer and an individual employee can make a flexibility arrangement.

But, once again, Labor were all promise and no delivery. The legislation they introduced made individual flexibility clauses effectively worthless. These clauses in union agreements typically allowed for only one or two minor terms to be varied and could be unilaterally terminated on a month's notice. Employers and employees ignored them as offering no practical benefit to either party. Yet so many people in my community tell me they crave individual flexibility. In opposing this bill, Labor and the unions ignore those voices, even though individual flexibility is within a collective framework and the employee is better off.

Another important feature of this bill is that it delivers on what was promised by the previous government in 2007 on union workplace access. It will implement fairer right of entry laws that mean business can carry on without unnecessary disruption. Employees can access union representation if they wish to; and, if they do not wish to, they are able to go about their business without unnecessary disruption or harassment. Right of entry is a statutory privilege and conditions ought to apply. This should particularly be the case, given the frequency of unauthorised site visits. As we know, Labor broke their promise on union access by giving unions much easier access to workplaces under the Fair Work Act, and it has been shamelessly and repeatedly exploited. We have seen the arrogance of CFMEU National President, Joe McDonald, who was fined $193,600, along with his union, for ignoring a request to leave a site in Western Australia. When asked to leave, because he did not have a right-of-entry permit, Mr McDonald replied:

I haven't had one for seven years, and that hasn't f**king stopped me.

Little wonder that unlawful industrial action by union official Joe McDonald has resulted in more than $1 million in fines being issued since 2005. Our changes will reduce union capacity to harass and disrupt business. The bill will also address the failure of the previous government to implement a number of common sense recommendations made by its own Fair Work Act Review Panel in 2012.

In all these respects, this bill implements the coalition's publicly stated election policy—nothing more and nothing less—and the sorts of mendacious claims made by the member for Wakefield will not change that fact. The government is strongly committed to these measures. They will help build a more stable, fair and prosperous future for Australia's workers, businesses and the economy. We therefore call on the Labor Party and on all members of this parliament to support the sensible and measured reforms included in this bill; they are about bettering the lives of all Australians.

I now turn to a separate and thorny issue, that of the actual limits of government workplace involvement. The coalition took to the electorate a clear plan of exactly what we would and would not do in relation to workplace policy, if elected. We seek now to fulfil only that which we promised. However, it is not lost on me, nor on any other member of the government, the pain that is currently being felt in wider Australia following large-scale job losses. The government remains deeply sympathetic to the immediate and obvious impact of these job losses on workers, families and local communities. But the fact remains that there are limits to government involvement in work. Arguably, they can be distilled into two different but equally pressing imperatives. The first is to set or adjust the conditions by which work might be made as fair as possible for all parties—not only for the few, militantly represented or aggressively outspoken but for the many, and for the long term. This is exactly what this bill does. The second compelling imperative is to guard taxpayers' money with great vigilance. The coalition will never allow taxpayers' money to be spent with the reckless abandon of the previous government. This will necessarily mean having to make tough decisions now, for the longer-term national good.

In the end, it comes down to this: business or commerce is ultimately about profit, albeit hopefully achieved in a way that is sensible and humane; but government, on the other hand, is about reality, reasoned compassion and prudence—treating people and organisations fairly and consistently and, not least of all, managing public tax revenues respectfully and with strategic purposes foremost in our mind. The government will, of course, continue to pursue its goal of doing what it can to make work safe and fair for all Australians, notwithstanding the wider turbulence of strategic global market forces, which are often opaque and difficult to predict. This is also reality.

To conclude, this bill is balanced, far-sighted and honest. It is balanced because it looks to the rights of all parties in the Australian work compact—employees, employers and government. It is far-sighted because it supports the creation of workplace conditions which encourage investment. And it is honest, because it meets in full and only that which the coalition actually proposed before, during and after the 2013 election. In terms of honest and reliable policy development, presentation and implementation, the Fair Work Amendment Bill is fair in both name and substance. I commend it to the House.

Adam Bandt (Melbourne, Australian Greens) Share this | Link to this | Hansard source

The full scale of Prime Minister Tony Abbott's attack on workers, especially young workers, becomes clearer day by day. When you put this week's budget together with this Fair Work Amendment Bill 2014, you realise that life in Australia for people at school who are about to enter the workforce is going to be very different from what it was like 10, 20 or 30 years ago. As we heard in Tuesday night's budget, a young person who does the right thing and finishes school and goes on to do a course at university, TAFE or somewhere else will have to spend the first six months looking for work with no income at all—not even the dole, which is below the poverty line. If they do not find a job and are lucky, they will be put on a Work for the Dole program. At the end of that time if they still have not found a job they will not be offered more support but will be kicked off the dole again and will spend six months without any income at all. This is a young person who is trying to do the right thing and look for work. It may be through no fault of their own because they may be in a country town where there is 17 per cent youth unemployment or they may be in a suburb in the city where the job prospects are low.

What is that young person who has done the right thing and finished studying and looking for work meant to do when the government takes away their income? Their landlord does not care that the laws have changed. The landlord just wants the rent to be paid on time. The electricity company does not care about the government's new approach. It is quite happy to turn the power and the heating off because they have got no money. God forbid that they get sick. If they get sick, they will no longer be able to find a doctor who will bulk-bill for young people. They are going to have to pay a co-payment to see the GP. If the doctor says they need a test and prescriptions, they will have to pay co-payments on those as well. So these young people looking for work will not go and see a doctor if they get sick.

They might get kicked out of their house, which makes this week's budget a recipe for homelessness. Ask yourself what you would do if you were a young person and you did not have enough money to buy food. Do not be surprised at all if you start seeing young people doing unsavoury things in order to pay for basics, such as food and power, because this government is going to take away their income full stop. What would you do if you were in that situation of trying to find a job and you could see looming a period of having to live without any money coming in?

When you look at this bill it is very clear what faces that young person. Their potential employer is going to say: 'I will be happy to give you a job. I know there is this pesky thing called the minimum wage, but I don't think I really want to pay you that. What I am prepared to offer you is something less than that, with a few extra benefits on the side. That might be different from the legislated legal minimum wage, but really it's up to you—take it or leave it.' Buried in this bill is a note in the section on so-called 'individual flexibility agreements'—and I will talk about what they are in a minute—that says:

Benefits other than an entitlement to a payment of money may be taken into account.

What does that mean? That means that it will be completely legitimate for a fish and chip shop owner to say to a young person, 'I'm going to give you a job, but I'm going to pay you part of your wage in fish and chips.' It is going to be completely legitimate for a cinema owner to say, 'I know there is this legal condition that says you have got to get a minimum wage of a certain amount, but how about we enter into an individual flexibility agreement where I give you some movie tickets instead?' Movie tickets and fish chips do not help you when you go to the supermarket to buy the groceries you need. They do not help you when you go to the electricity company and say you cannot pay your power bill. You cannot say, 'I'm sorry I cannot pay the power bill, but how about a potato scallop instead?' That is the future if this bill passes and if this budget passes. It will systematically allow employers to drive down wages and conditions. An employer will be able to enter into a legally binding agreement with their workforce on Monday and then contract out of it with a particular individual on Tuesday. When you take into account the immense pressure that is going to be put on young people, you can see exactly what that is going to do to people's wages and conditions in this country. It is going to be worse in those areas where there is already existing high unemployment.

I do not know about the people who are putting this bill forward, but before I came to parliament I spent 12 years working with some of this country's lowest paid workers. These were people who had no other opportunities. They were told, 'If you are happy to sit in a room or in your garage in inner or outer suburban Melbourne and sew clothes to be sold on Bourke Street for $200 or $300, we will pay you $2 to $3 an hour.' These were people who did not have English as their first language. These were people who had limited skills. These were people who, under existing laws, were told to call themselves independent contractors and look after their own superannuation and work cover, which of course they did not and they will have no plan for their retirement. They were told to do all of that and maybe it will give them a little bit of money. That is what is in store for all young people in this country in the future if this legislation passes.

I have news for those opposite who talk about flexibility. They talk about flexibility as a one-way street. These are the same people who not prepared to say, 'Let's amend the laws to give people who are looking after kids greater power to have more time off so they can pick the kids up from school or drop them off.' These are people who say, 'No, we will not allow employees to have greater security over their work if that is what they want and that is what suits them.' For the Liberals, flexibility works only one way—it is flexibility from above. But I have news for them. You do not need this provision in the legislation to allow genuine agreement between employers and employees to vary wages and conditions, because it already happens. When you have good employers and good employees, you reach these kinds of agreements all the time. People reach these kinds of agreements all the time, but they do it against the backdrop of legislation that sets out what the Australian community thinks is a fair minimum standard of wages and conditions.

The legislation that is before the parliament today is about changing that minimum standard. It is not about giving people more flexibility; it is about giving bad employers more power over vulnerable people, who are going to be in an even worse position after this budget.

And it does a number of other things. Most of us would think that an agreement applying in the workforce involves at least two people—at least two parties. But, under this legislation, an employer is now going to be able to agree with itself about what legislation and minimum conditions will apply in a workplace. The provision about so-called greenfields agreements says that, if you are about to start a new project that might be to dig up the minerals that all Australians own—we only get to dig them up and sell them off once—and you want to negotiate an agreement for wages and conditions over the course of that project when it gets up and running, all an employer has to do is put a substandard agreement on the table and say, 'Here's what I want.' If three months later there has been no agreement, it is able to go off to the Fair Work Commission and get the agreement ratified. You do not even need another party to the agreement. You just have to decide it yourself. I am very sure that a wealthy miner is going to look after its workers when it does not have to! It is going to pay the least it possibly can. That is what this legislation allows it to do.

We have also seen this obsession from the government about employees having access to their union representatives at reasonable times. I can tell you stories of workers in sweatshops—making the clothes that those of us in the chamber here today will be wearing—who are working on less than minimum conditions and would dearly love to know what those minimum conditions are. Often the only way that they will find out about them is from a union representative who comes in and tells them, 'No, actually there are laws and you are entitled to be paid properly as a member of the Australian community.' Yet, what we see here in the legislation is a winding back of those provisions that allow someone to come in and give that explanation. What we know—because I have seen it happen—is that what some unscrupulous employers do at the moment, or have been doing in the past, is say, 'Sure, you, low-paid worker, can find out about what your minimum legal rights are, but I tell you what I'll do: I'll put the union representative, when they come during your lunch break, in a room next to my office and I'll just sit there with a clipboard making a note of every worker who comes in to get advice about what their minimum conditions are.' Currently, the legislation says that you cannot do that. You must strike the right balance between not disrupting the workplace and allowing people to find out what their minimum entitlements are. That goes under this legislation. When you think about this from the perspective of a vulnerable worker who may not have English as their first language, how are they going to find out about their rights? They just will not. That will be the practicality of it. That is exactly what this legislation is designed to do.

The legislation tilts the playing field further in favour of powerful employers by allowing them to just sit there, fold their arms and say, 'We refuse to engage in discussions with you about an enterprise agreement.' Also, it will take away the only thing that the employees have the right to do in that situation, which is their right to industrial action. At the moment, if the employer refuses to negotiate with you, the employees are allowed to say, 'We're going to start stop-work meetings,' or, 'We're going to go on strike until you strike a deal with us.' This is not something that is fanciful or of no consequence. At places like Cochlear, for some eight years, I think, the workers who are making the bionic ears that are one of Australia's greatest export inventions have been unable to negotiate an agreement with their employer. Does this bill give them the right to go to Fair Work and say, 'Look, we just can't strike a deal; why don't you decide as the independent umpire?' No, it does not allow them any help. In fact, it further ties their hands and allows the employer to sit there and say, 'I'm just not going to negotiate with you.'

These are just some of the measures in this bill. There are others that say, if you have happened to accrue annual leave loading and other generous measures during your time at work, and it turns out that you get sacked before you have had the chance to take them, do not expect to get your full entitlement paid out—you are only going to get part of it. That is what this legislation says when it comes to annual leave loading. When one looks at the other provisions, you can see that the government has gone back to the previous Fair Work review and just picked the eyes out of the things that work to implement on one side of the ledger, but there is nothing there to balance it up on the other side.

I will be moving some amendments, when we come to the consideration in detail stage of this bill, to remove the clauses of this bill and, instead, substitute them with other clauses that would actually benefit working people in this country. These amendments would give them more job security and allow workers to have the flexibility that works for them, so that they can have the time off to pick up the kids, to drop them off at school or, perhaps, to look after a sick grandparent. That is the kind of flexibility that we need, not this flexibility from above in this bill. If this bill passes, and if the budget passes, the future for young workers in Australia is very grim indeed.

Karen McNamara (Dobell, Liberal Party) Share this | Link to this | Hansard source

I rise to support the Fair Work Amendment Bill 2014. It is important to recognise that this bill will deliver key aspects of this government's policy. This policy was endorsed by the Australian people at the September election. This government is delivering on its election commitments and, through the Fair Work Amendment Bill 2014, we are restoring balance to our workplace relations system. The bill will do this by improving the process by which greenfields agreements may be negotiated; ensuring that agreements are not frustrated by unions pursuing unsustainable claims and forcing delays to commencement which may threaten investment in major new projects that are crucial to our prosperity; restoring union workplace access rules to reflect those which were in place prior to Labor's union-friendly amendments; dealing with excessive right-of-entry visits by union officials; improving workplace productivity and flexibility by enhancing the scope for employees to make individual flexibility arrangements to meet their genuine needs, as determined by those employees; and closing the strike first, talk later loophole within the good faith bargaining rules, which Labor refused to address.

In 2007, the previous Labor government promised a fair and balanced workplace relations system that would guarantee necessary protections to employees whilst allowing employers the necessary flexibility required to operate viable and sustainable businesses. Unfortunately, what we saw from Labor was a resetting of the workplace relations pendulum in favour of the union movement. This effectively applied a handbrake to the Australian economy. Labor made a promise, prior to the election, and delivered something entirely different while in government. This is in stark contrast to this government, which is getting on with the job of building a stronger economy so that everyone can get ahead. One of the ways we are doing this is through our commitment to a more balanced and fair workplace relations system. The amendments presented in this bill will provide a more balanced workplace relations system whilst safeguarding workers' conditions and protections. The Fair Work Amendment Bill 2014 is good for jobs, good for workers, good for employers and good for the economy.

Labor's economic and workplace relations management since 2007 saw the slowest wage growth on record dating back to 1997. The ABS wage price index reflected a mere 2.6 per cent growth in wages in 2013. It was so low that it slipped below the inflation rate as measured by the ABS consumer price index. This meant a moderation in living standards, a decline in employment and a fall in real net national disposable income per capita. These figures illustrate the need to have a flexible workplace relations system, adaptable to the economic challenges present across the economy. Australian CEOs across the mining, manufacturing, services and construction sectors have stated concerns about the lack of flexibility in industrial relations as being an impediment to growth in 2014. This bill will provide clarity and certainty for employers and employees on the use of individual flexibility arrangements.

In theory, individual flexibility arrangements are an important tool. They were introduced by the former government with the intent of enabling workers and their employers to mutually agree on conditions that suit their respective needs while ensuring that employees are better off overall when compared to their underpinning employment instrument. Individual flexibility arrangements should be central to a workplace relations system that supports the varying employment needs of workers in a modern economy. For example, individual flexibility arrangements can act as a real alternative workplace agreement, enabling employees to manage their childcare or other caring arrangements so as to spend time with family or to manage other commitments. These arrangements are specific to the individual and are not designed as a management tool for business. Importantly for the employee, an employer cannot force an employee to sign an individual flexibility arrangement or make an arrangement a condition of employment. The employee must be better off overall than they would have been under the applicable modern award or enterprise agreement and a worker must provide a statement to the employer that the individual flexibility arrangement meets their genuine needs and they are better off overall.

Under the current Fair Work system, unions are able to restrict the scope of flexibility terms under enterprise agreements to only cover a single matter; for example, the taking of leave. This means that workers may be denied the opportunity to make individual flexibility arrangements on other matters even if they and their employer agree to other suitable arrangements. Under the former Labor government, we saw the potential benefits of individual flexibility arrangements traded away for the priorities of union officials and union bosses. There have been widespread calls from business and industry supporting a return to flexibility in the workplace.

In my electorate of Dobell, the unemployment rate of 6.88 per cent sits above the national average. Faced with even higher youth unemployment figures and low workforce participation we need the option of flexibility arrangements to encourage workforce participation. There is a great manufacturing business in Dobell that has had issues with union right of entry. This is a business that is compliant with the law and has an agreed and established system in place for union officials and visits, despite not having a unionised workforce. They are also a lean business. They deal with three major customers who are big-players with a significant market share. They demand suppliers run lean, efficient and productive business operations. However, this has been exploited by union officials through behaviour akin to the lunchroom invasion. There have been 16 visits by union officials to the non-unionised workforce over 12 months. The principle reason given for the visits by union bosses was recruitment. The main line from an union official was that every worker could only get an additional $14 through the union. This local Dobell business has a great employee culture of safety, performance and productivity amongst the 140 staff. The hard-working staff quickly came to the realisation that $14 across 140 staff was going to very quickly make that lean and efficient business not so productive and have an impact on their combined ability to deliver a competitive product on tight margins to demanding customers. This is a perfect example of the right-of-entry provisions being exploited by union bosses for their own benefit, resulting from more broken promises from the Labor Party.

The amendments before the House will deliver on the promises made by Labor in 2007 and ensure that workers have access to a fair degree of flexibility without providing a veto to union bosses and union officials. This bill will address the current imbalance in union workplace access rules, and our changes will fairly and sensibly balance the right of employees to be represented in the workplace, if they wish to be, with the right of employers to go about their business without unnecessary disruption.

The former Labor government opened the door for the union movement into Australian businesses, resulting in 523,700 working days lost due to industrial action in the last three years alone. Labor made no attempt to implement any recommendations in order to reduce such action. Under Labor's policies we saw a devastating loss of productivity across the Australian workforce, primarily as a result of two policy failures: right of entry provisions and the 'strike first; talk later' loophole.

This government sees right of entry as a specific statutory privilege to which conditions ought to apply. Regrettably, some union bosses do not. This bill will amend these provisions insofar as the ability for unions to enter a workplace is tied either to a union's recognised representative role at the workplace or to employees at the workplace having requested the union's presence. Furthermore, a union will only be entitled to enter a workplace for discussion purposes if (1) they are covered by an enterprise agreement or (2) they been invited by a member or employee who they are entitled to represent. The changes proposed by this bill will enact Labor's publicly stated promise prior to the 2007 election—another promise broken.

The bill will also remove the 'strike first; talk later' loophole under the Fair Work Act. The then opposition leader, Kevin Rudd, stated in 2007:

Industrial disputes are serious. They hurt workers, they hurt businesses, they can hurt families and communities, and they certainly hurt the economy.

Mr Rudd further stated that employees 'will not be able to strike unless there has been genuine good faith bargaining'. However, once again Labor failed the policy test, implementing a workplace relations framework whereby employees are allowed to strike before bargaining has commenced. This is why in three years we have seen 523,700 working days lost due to industrial action.

This amendment bill will mean that industrial action cannot be the first step in the bargaining process. It will therefore restore a balanced and harmonious approach to enterprise bargaining. The bill also seeks to make amendments to the greenfields provisions in order to help unlock new investment and prevent needless delays to new projects. The Australian Industry Group rightly highlighted in 2012:

Unions currently have too much power to refuse to enter into a greenfields agreement for a new project unless all their demands are met.

These amendments seek to provide confidence and certainty to investors and to ensure that Australians benefit from the prosperity generated by new projects. This will strongly signal to investors that Australia is open for business.

This bill also implements other recommendations from the Fair Work Act review—a review undertaken by the now Leader of the Opposition—including: removing inconsistency that currently exists by allowing employees in some jurisdictions to accrue or take leave whilst absent from work whilst receiving workers compensation benefits; restoring the longstanding position that employees are only entitled to annual leave loading when their employment ends where it is expressly provided for in their award or workplace agreement; and the introduction of the requirement that an employer must give an employee who has requested to extend their unpaid parental leave a reasonable opportunity to discuss the request unless the employer has already agreed to the request.

The measures outlined in this bill deliver on key aspects of our election policy. We must look at restoring fairness and flexibility to the workplace to support new jobs growth. The test for the Labor Party is whether they will support measures outlined in the Fair Work Amendment Bill 2014 to lead to a more productive workplace relations framework, increased jobs and higher real wage growth. They now have a chance to atone for their broken promises by supporting the measures in this bill—the same measures that they outlined and committed to in 2007.

This bill implements the coalition's publicly stated election policy—nothing more, nothing less. This government released its workplace relations policy well before the 2013 election to address the aforementioned problems within the fair work laws. The measures in this bill will help encourage investment in new projects that are important to the Australian economy by preventing unions from vetoing greenfields agreements. Industrial action will be reined in by ensuring that bargaining must have commenced before strike action can be taken, reducing unnecessary losses in productivity and working days lost, and we will restore much needed flexibility to the workplace through improvements to individual flexibility arrangements, which will lead to increased productivity and fairness. I commend this bill to the House and call on members opposite to support its measures.

Kelvin Thomson (Wills, Australian Labor Party) Share this | Link to this | Hansard source

The Fair Work Amendment Bill 2014 claims to strengthen protections for employees by requiring employers to ensure that under individual flexibility arrangements workers' genuine needs are met and they are better off overall, but on the flipside it implements a 'get out of jail free' card for employers regarding this obligation, by providing them with a legal defence where they will not be held liable for breaching the flexibility terms if they enter into an individual flexibility arrangement 'believing' they were complying with those terms. The new rules say that all an employer needs to do is to claim that they had a reasonable belief that they were doing the right thing in order to avoid prosecution.

The Prime Minister used to say that Work Choices was, 'dead, buried and cremated', but in insidious ways, as demonstrated by this amendment bill, the reality is otherwise. Recently the union United Voice recounted the story of Jackie Petts, a Victorian cleaner. Jackie was presented with an individual agreement by her employer, Spotless, which cut her weekend shift pay, and she refused to sign it. As she explained: 'Spotless came up with a form for all of us to sign. It cut our weekend shift pay. The supervisor came round and said, "Sign this or you won't have any weekend shifts." Those that signed kept their normal shifts. I didn’t sign and I lost my weekend shifts. None of those who signed talked about it, they just signed. I kept my job, but without the weekend shifts it was not enough to live on.' Individual flexibility arrangements are supposed to be voluntary, but Jackie's experience demonstrates that this is not how they work in practice. When employers put individual agreements in front of their employees, people are under pressure to sign—even though it means a pay cut.

Jackie was working a six-day week, relying on that sixth weekend shift in order to earn a living wage. Modern cost-of-living pressures, including the rising cost of housing, electricity, rates, water, gas bills, which are outstripping CPI, can mean that shift allowances and penalty rates are crucial. In Jackie's case, her shift allowance is extremely important as she is paying off her house on her own. Weekend and evening rates make up anywhere from 10 to 30 per cent of the take-home pay of shift workers. The removal of weekend rates can mean shift workers lose up to $270 per week or up to $14,000 a year before tax. The Liberal government's individual contracts could mean some Australian workers will be forced to support their families on just $577 per week after tax. Under this amendment, it would become legal for Jackie to sign away her weekend and evening rates for no extra pay.

The Liberal Party talks about workers and employers having the flexibility to sit down and negotiate unfettered by red tape. This is simply a euphemism for eliminating checks and balances. The reality is starkly different. There was no mutual chatting, when the 150-odd cleaners at Westfield Doncaster were handed their individual agreements. Jackie was punished for daring to refuse, as should have been her right, what was being offered. These laws are part of a concerted attack, aided and abetted by right-wing free market ideologues and some in the business lobby, to strip away penalty rates and shift allowances, and to undermine collective bargaining and access to union representation. This sort of stuff is Work Choices by stealth. As the former Labor Prime Minister Paul Keating said:

When John Howard decided to go after workers with his WorkChoices legislation, he did so not out of any economic necessity, as the economic record for wages and inflation attests. He did it simply to break the back of the unions. His motivations were ideological and spiteful, telling us he had learned nothing from the fact that there had been no wages breakout in Australia for 26 years …

The same is true again today. We hear Liberal government ministers blaming workers for excessive wages and conditions. In a speech to the Sydney Institute, the Minister for Employment, Senator Eric Abetz, warned about employers being too ready to acquiesce to unions. He claimed that Australia risked

… seeing something akin to the wages explosion of the pre-accord era when unsustainable wage growth simply pushed thousands of Australians out of work.

The reality is very different. Recent Wage Price Index data revealed that 2013 had seen the lowest annual rise in wages since the ABS began calculating them back in 1997. In seasonally adjusted terms wages rose only 2.6 per cent in the 12 months to December. In trend terms it was even lower at just 2.5 per cent. As Greg Jericho, from The Guardian Australia, said in reference to this index:

If we’re about to see a wages explosion, then someone better hurry up and light the fuse.

Wages increased in 2013 by less than inflation did, which suggests that real wages actually fell last year. The last time this has happened was during the GFC.

The record low wages growth fairly destroys the arguments of the Liberal and National parties and certain sections of the media who, even before Kevin Rudd was elected in 2007 and well before the Fair Work Act was introduced in July 2009, have been predicting a wages boom, blowout or explosion.

Piers Akerman in the Daily Telegraph, for example, wrote in 2007 that the policies proposed by then opposition leader Kevin Rudd risked a “breakout in wages growth that would inevitably force the RBA to impose interest-rate hikes of a magnitude not seen since the Hawke-Keating era”.

Instead we have record low wages growth and record low interest rates.

When the overall wages data did not provide the wage-boom truthers with the picture they predicted, they moved onto federal enterprise agreements. These agreements are done through collective bargaining and thus involve unions. But here a similar picture emerges. Annual average wages growth of enterprise agreements is lower now than at any point since 2000 and wages growth in public sector enterprise agreements is actually lower than that of the private sector. As for the Manufacturing Workers Union acting like it is boom time, that is equally fanciful. In the manufacturing sector the growth in wages under enterprise agreements is at its lowest since 1994. Any way you slice it, wages growth across the economy has fallen in line with the falling demand in the economy. That is how you would expect the system to work and that is how it has worked. People who look at the last four years and still utter the phrase 'wages boom' are the economic equivalent of climate change deniers.

In this House in 2009, I spoke about just how profound the impact of Work Choices had been on women. An article published in the Journal of Industrial Relations, titled 'The Impact of 'Work Choices' on Women in Low Paid Employment in Australia: A Quantitative Analysis', studied the experiences of 121 women across five Australian states who were affected by the changes arising from Work Choices. Contrary to the spin of the previous Liberal government that Work Choices would facilitate direct negotiation between an employer and an employee, the study revealed that low-paid women were vulnerable to a take-it-or-leave-it culture, and they were vulnerable to unilateral action. Most employees made it clear that they were not in a position to negotiate directly with their employers, and would not be able to unless they had some job protection. This scenario is the same as that encountered by Jackie Petts. It is likely that vulnerable people, such as those in casual work, people from non-English-speaking backgrounds and workers with family responsibilities, will be most at risk of being pressured into signing the Liberal government's version of individual contracts. In particular, the more than one million non-Australians who are in Australia on temporary visas, which have accompanying work rights, are vulnerable to precisely this kind of exploitation.

Too many Australian workers are already struggling to deal with the impact of insecure work, and amendments like this will only accentuate this problem. In the Centre for Policy Development's book, Pushing Our Luck, a chapter on Australian workplaces made the following point:

This insecurity creates first and second-class citizens, with temporary migrant workers relegated to an even lower rung on the ladder.

The real workplace relations issue we have in this country is not lack of workplace flexibility but lack of job security and poor work-life balance. Indeed, a recent survey conducted by the OECD reports that the No. 1 problem identified by Australians—not so much in other countries but certainly by Australians—was poor work-life balance.

Despite the repeal of WorkChoices the transformation of Australia's job market to more precarious employment means that many Australians are at risk of going through their working lives as if WorkChoices was never repealed. As further outlined in Pushing Our Luck:

It is sometimes argued that workers like casual jobs because they are more flexible. Submissions to the ACTU's Inquiry on insecure work detailed the experiences of many people who found that the opposite was the case. One such testimony highlighted the lack of flexibility available to casuals. The worker recounted being unable to take time off work because, as the breadwinner, she needed to make money while she could, and with no permanent position she couldn't be sure when she would have a job again.

The transformation of the labour market has created an underclass of workers who miss out on many of the protections offered by employment regulation. Their reality can include chronic uncertainty, inadequate income, lack of access to mortgage and credit facilities, inability to afford health care, no paid access to family, carer's or annual leave, limited savings and a general slide into debt and potentially poverty. They report being victimised if they raise their concerns and they are less likely to be unionised.

This is a stark reality for too many Australian workers today … as business owners sidestep regulation by entering into arrangements that limit the rights of workers and take them beyond the protection of Australia's employment standards.

Migrant workers, particularly those on 457 and student visas, are particularly vulnerable to exploitation through insecurity.

It is not just 457 visas workers who are exploited. In March the ABC's Matt Peacock reported that thousands of Taiwanese on working holiday visas, the 417 visas, were being ripped off in Australian abattoirs, working long hours for little pay. According to the Australian Meat Industry Employees Union, the Primo Meatworks in Scone, New South Wales has replaced local workers with international workers, who in many cases do not pay tax. Meatworkers union secretary Grant Courtney estimates there are over 10,000 temporary international workers working in the meat industry on backpacker visas. Many of these 417 visa workers are being paid cash.

The way to clean up this exploitation and tax avoidance is to require the principal employer, the owner of the business, to be the one who engages the workers. We need to get rid of the $2 labour hire companies who fold up and go into liquidation if they are ever investigated. Moreover, why do we allow backpackers to have access to an ABN? Applying for a tax file number should be part of the 417 visa application so that they pay tax in the same way that 457 visa workers pay tax. A real workplace problem is the issue of lack of secure or guaranteed work, with what I have heard referred to overseas as 'zero-hour contracts' replacing full-time or permanent-part-time positions.

I was very concerned to hear from Grant Courtney that, since Matt Peacock's 7.30 program investigation, some 13 of the 14 workers at the Primo Meatworks who had signed a petition in support of workers alleging sexual harassment by a Primo employee had been told that their services were no longer required, despite their generally having worked six days a week for the previous six months.

Rather than seek to blame workers and legislate to make their employment more insecure, the Liberal government would do better to ditch their discredited ideology on workplace relations, and look to enhancing protections for casuals, contractors and labour hire workers, who face insecurity at work with no end in sight.

Denmark, Norway and Sweden have achieved both a healthy economy and a healthy society, high wages and productivity, flexible working arrangements and the world's highest rate of workforce participation, especially among women. These three countries boast workforce participation rates of almost 80 per cent, and female participation of about 76 per cent, according to OECD figures. Female participation is a full six percentage points ahead of that which prevails in Australia, the US and Britain. We should follow and learn from those northern European countries, which have cooperative industrial relations models rather than adversarial ones, greater rights for workers and greater income equality. Also, they have better workforce participation and employment outcomes as a consequence. I support the amendment to the motion moved by the member for Gorton.

Eric Hutchinson (Lyons, Liberal Party) Share this | Link to this | Hansard source

I note the comments by the member for Wills. He has clearly articulated a view that is held by the unions of Australia, and he has articulated that case particularly well. But the reality is that the members of those unions, the individuals, are exactly that—they are individuals—and individuals have different circumstances. Not always are the measures by which an employee judges job satisfaction financial ones. The notion of flexibility in ultimately getting that balance between life and, dare I suggest it, work as a second priority should be the ideal we all aspire to. Let us be quite clear that no employee is being forced to do anything.

The Fair Work Amendment Bill 2014 will deliver on key aspects of our election policy and not go any further. Indeed, on union workplace access, individual flexibility arrangements and the removal of the ability to strike first and talk later, we are delivering on specific policy promises made by the Labor Party prior to the 2007 election, which were later not delivered.

Through our Fair Work Amendment Bill 2014 we are giving effect to a number of commitments in our policy, and further restoring balance within the system. We will do this by a number of measures. Firstly, we will improve the process for negotiation of greenfields agreements to ensure that unions can no longer frustrate bargaining for these agreements through unsubstantive claims and delays, which can threaten investment and delay the commencement of major new projects. In my state of Tasmania, goodness knows sovereign risk and the ability to get big and major projects up is something that is dearly needed. Secondly, we will restore union workplace access rules, reflecting those in place prior to Labor's unbalanced amendments in dealing with the excessive right-of-entry visits by union officials. Thirdly, we will improve workplace productivity and flexibility by enhancing the scope for employees to make individual flexibility agreements that meet their genuine needs as determined by those employees. Fourthly, we will close the 'strike first, talk later' loophole in the good faith bargaining rules, which unfortunately the previous government refused to address. And, finally, we will maintain the value of unclaimed wages recovered for workers by the Commonwealth. The bill also enacts a number of recommendations from the fair work review panel in its 2012 report commissioned by the now Leader of the Opposition, Mr Bill Shorten.

Why is the government proposing these changes? The changes in this bill will implement a number of commitments that the government made in the coalition's policy to improve the fair work laws, which was released four months prior to the 2013 federal election. The amendments in this bill will ensure that the fair work laws maintain a strong and enforceable safety net for workers while helping businesses expand, create new jobs and deliver, importantly and critically, perhaps the hallmark of the former Howard government—that is, higher real wage growth. The changes will restore certainty to the workplace relations system and make the laws more balanced and effective, helping to make Australian workplaces better.

But my focus today in terms of my electorate and the things that I hear from the employers and the employees is on individual flexibility agreements. This bill introduces amendments to provide clarity and certainty for employees around the use of individual flexibility arrangements. I will call them IFAs. IFAs are an important tool introduced by the previous government with the intent of enabling workers and their employers to mutually agree on conditions that suit their needs while ensuring that employees are better off overall compared to their underpinning employment instrument. It is pretty basic stuff. Work-life balance is not measured in just one respect. IFAs ought to be an important option to enable employees to, for instance, manage their child care or other caring arrangements, to spend time with family or for other commitments that they have. They are specific to individuals and not designed as a management tool for business, because we are, after all, individuals with different emphases and different interests. It is about a practical life-work balance, and nothing is more valuable to an employer than a capable, happy and satisfied employee. It is often about the union boss's perspective, not the employee's.

These amendments about IFAs are based on the fair work review panel recommendations. They also include further safeguards to ensure that employees are better off. Ironically, and something that is very often lost from a union perspective, this is also in the best interests of the employer. To be clear, the current IFA framework in the Fair Work Act will stay, with additional protections put in place. This essentially means an employer cannot force an employee to sign an IFA or make it a condition of employment, and the employee must be better off overall than they would have been under the applicable award or enterprise agreement. This is often quite arbitrary and not necessarily measured in financial terms in respect of the employee. It is a point that we must understand. A worker must provide a statement to the employer saying that the IFA meets their genuine needs and that they are better off overall. The onus is ultimately on the employee. And, as strange as it might seem, beauty is often in the eye of the beholder: we are all different, we are all individuals, we all have our own aspirations and priorities.

Under the current system, unions can restrict the scope of flexibility terms under enterprise agreements through the bargaining process to only cover a single matter—for instance, the taking of leave. With all due respect, while speaking in favour of these amendments—and in this instance by virtue of union negotiated positions—it would appear quite possible that these conditions could potentially be discriminating against the employee—a little ironic. This means that workers may be denied the chance to have IFAs on other matters even if they or their employer want to agree to more mutually suitable arrangements. The amendments will deliver on the promises made by Labor in 2007 and provide that IFAs may be made in relation to all of the matters currently prescribed in the model flexibility term, to the extent that those matters are covered in the agreement. This will ensure that workers have access to fair flexibility without a veto by union bosses. And ultimately we are all individuals with different passions and different perspectives and this, sadly, is the failing, quite often, of negotiations by a collective.

The bill also implements the fair work review panel's recommendation that employers should, in limited circumstances, have a legal defence if they enter into an IFA in good faith believing it meets all the requirements of the legislation when it turns out later it does not.    The defence will only apply where the employer believed on reasonable grounds that all statutory requirements had been met in relation to the IFA. And a reality is that our circumstances change. It is as true for employees as it is for employers. The bill will also strengthen protections for employees by requiring a statement setting out that the arrangement meets their genuine needs and results in them being better off overall. This will make the position absolutely clear. Employees will only make IFAs that provide for non-monetary benefits when the employees themselves make a clear statement in writing why they are better off overall. In a practical sense, what a powerful position that is for an employee to be in, in respect of choice. That employee will be the master of his own destiny.

By way of an example in respect of overtime rates, take an employee. Let's call him Bill. Bill works full time as a mechanic. His employment is covered by an enterprise agreement which has penalty rates. Bill's mum lives interstate in a rural area and unfortunately is unwell. Bill wishes to work Monday to Thursday so that he can travel on Fridays to his mum and stay with her until Sunday. This will allow Bill to help his mum with domestic tasks.

Bill still wishes to receive his normal weekly wage and so does not wish to work part time. Bill approaches his employer to discuss different working arrangements and they agree to make an IFA allowing Bill still to work 38 hours per week by working later Mondays to Thursdays without the penalty and overtime rates that would usually apply to extended working hours. Bill is better off overall because he is able to work all of his hours and help his mum on Fridays—something he values as a significant benefit—and will still receive his normal weekly wages.

Two further amendments recommended by the Fair Work Act Review Panel will be made to provide clarity and certainty to both employers and employees. First, the unilateral termination period for IFAs made under enterprise agreements will be extended from 28 days to 13 weeks, consistent with the position for awards. In addition, the 13-week unilateral termination period for both modern awards and enterprise agreements will be placed in the legislation.

This comes to the heart of this aspect of the bill and the word 'flexibility'—what it means to have a flexible agreement if circumstances change. Goodness knows, life throws things up at us, and this provides the individual flexibility that allows the process of transition for both employees and employers as their circumstances change.

The second amendment will confirm the existing position that the 'better off overall' test for IFAs can be satisfied by exchanging monetary benefits for benefits that are not monetary. This is already the case under the legislation as introduced by the Labor Party while the Leader of the Opposition was the workplace relations minister. This position has been confirmed by the independent Fair Work Ombudsman. The amendment, combined with the government's new requirement for a statement in writing from the employee, will provide greater protection and certainty for all parties.

All other rules relating to an IFA will be retained, including that they cannot be made a condition of employment, must leave the employee better off overall, and must be genuinely agreed to. Anyone who opposes these amendments needs to explain to the Australian workers why they should not have the opportunity to be better off overall if the arrangement genuinely meets their own needs as assessed by—guess who?—themselves. We are, after all, all individuals.

The fact is that this is part of a greater plan for our nation, to allow every Australian the opportunity to be their best. This legislation complements the jobs growth we have seen since the coalition took government and the measures announced within the budget.    Since the election the number of jobs has increased by 107,000. The economic outlook in the budget is consistent with the government meeting its commitments to create one million jobs over five years, and two million jobs over 10 years.

We are committed to providing an environment where young people with a work capacity will be required to be earning, learning or participating in work for the dole. We will be removing loan fees for FEE-HELP and VET FEE-HELP from 1 January 2016 to create a level playing field across higher education institutions. Not everyone wants to be lawyer. I can tell you that over summertime the biggest boats in St Helens are owned by plumbers and electricians—and more power to them.

We will be providing businesses with up to $10,000 for employing workers older than 50 who have been on income support for six months or more, meaning there will be a real incentive to engage with and hire older Australians. This is about getting the work-life balance right, and we are a government committed to removing the barriers that prevent a person's entry into the workforce. These measures enhance that message for the nation, for the local community and for the individual, that having a job is the best form of welfare.

The government is strongly committed to these measures. They are necessary to help build a more stable, fair and prosperous future for Australia's workers, businesses and the economy. We therefore call on the Labor Party, and all members of this parliament, to support the sensible and measured reforms included in this bill.

Laurie Ferguson (Werriwa, Australian Labor Party) Share this | Link to this | Hansard source

In his contribution, the member for Eden-Monaro, as well as outlining a bit of history, claimed credit to the Liberal Party for Australia's industrial relations system insofar as Sir George Reid, Liberal Prime Minister of this country, was instrumental in that period.

Having been a previous member for Reid, I hazard to guess that I know slightly more about his history and nature than the member for Eden-Monaro. In fact, I have great confidence that if Reid were around in this period of history he would not be supporting these measures. We have had a very fundamental change in the power relativities in this country over the last few decades. If, for the sake of argument, the opposition were correct—in their analogy of a hugely powerful trade union movement, massive wage increases throughout the economy and high levels of unionisation—there might, intellectually, be some defence for these changes.

The member for Eden-Monaro talked about a rebalance. He said that things had gone too far under the previous government. In fact, the previous government in no way fundamentally reclaimed large areas of industrial relations change that had been engineered by the previous Howard government. They made some gestures to move in the other direction, but there has been a fundamental shift of power in this country occasioned by casualisation, the smaller average unit of employment, the import of overseas labour, deskilling, and contraction of manufacturing industry. All these realities are what is occurring in Australian industrial relations.

So there is no real picture as presented by the government. It is a very different industrial climate in this country. The reality, perhaps, was driven home yesterday by the decision in the Fair Work Commission to strip 25 per cent off weekend penalties for people in the catering industry. It was spoken of as being 'labour cost relief' and they held out the hopeful dream that it may 'consider the reopening of some venues'. This came after complaints that passengers on luxury liners in Sydney could not get breakfast when they got off the boat.

It was also preceded by comments by the New South Wales Business Chamber:

… spiralling upwards at a rate that makes opening on weekends simply unaffordable for many small businesses.

That was a contention of the chamber, and they said:

The lure of penalty rates is meaningless for staff …

Well, I doubt that in actual fact. I think it is fairly fundamental, with the low wages in that structure. You just have to look at the actual payments out there. Many of those people need those penalty rates very much. It is probably what attracts a few of them to the industry.

This was occasioned by a Herald Sun editorial under the headline 'War declared on penalty rates' back on 5 February. Mike Smith, ANZ Bank chief executive noted:

Within political parties we see diminishing numbers of reform minded individuals and even more worrying, we have seen the emergence of political parties and politicians whose views no longer describe the reality we face.

John Hart, of course, who is a very big operator in the restaurant and catering sector, was out there yesterday and very much supporting this decision. He had said earlier that it was disgraceful that people got $27 an hour on weekends. I want to stress: that is what they get on weekends. That is not what they get for most of the week. And that should be borne in mind in light of what we think about people's wage rates.

At that time the Australian Industry Group put on the agenda, through its chief, Innes Willox, the long-term aims of business in this country. He said that they want to control workers' annual leave taking, they want to cash out annual leave—which people are allowed to accumulate; quite frankly, I think people should take their annual leave as early as possible, that is why we have it—and they want to change time off in lieu and part-time operations.

Of course John Hart, who is so vocal in this sector, recently gained some notoriety, not only as a failed preselection candidate for the Liberal Party for Parramatta a few years ago but as the driving force behind the operation of the member for North Sydney, the North Sydney Forum. This, of course, is where keen business sector partygoers are encouraged to pay as much as $22,000 to be at the table with the Treasurer. Some people were giving as low as $3,000.

So that is very much the reality of industrial relations in this country. That stripping of people's conditions yesterday is what is occurring, and what I have said of the words of the Australian Industry Group is what the agenda is in this country. It is not an era of trade union rampant power in this country. It is not only what we are seeing in this legislation but it is also in relation to the question of immigration that we are seeing the government's real agenda. In the bid to get rid of this 'ever-present' red tape, we saw the recent decision with regard to 457 skilled migrant entry to this country. In 2013 Labor closed what I think is a loophole that should be destroyed, described by an article in The Age:

Before the loophole was closed in 2013 by the Labor government, companies in the mining, construction or IT industries were hiring hundreds more workers than they had applied for. In one example, an employer was granted approval for 100 visas over three years yet in 18 months had brought in 800 workers on 457 visas.

Before the cap was introduced in 2013, the number of 457 visas was rising quickly. In the financial year 2009-10 there were 68,000 granted. By 2012-13 it was 126,000, and that is why the previous government—belatedly, as far as I am concerned—did something about making sure that there were restrictions on this.

AWU assistant national secretary Scott McDine is quoted in the article:

These secretive changes come on the back of the government's announced review which has been stacked to deliver a predetermined outcome that will hurt Australian workers.

Basically, this gets rid of the requirement that there be advertising, and it liberalises it so that you can have far more visas.

I was interested that the member for Eden-Monaro said that this legislation was the government 'starting to do things'. We know from the elections that there was no intimation that in this legislation they would go beyond the actual inquiry in this sector. But they have done this in the legislation. He said that this was 'only the start'. He also pontificated about a correlation between industrial relations regulation and employment. On both sides of politics the evidence for this is pretty poor—it is pretty non-existent. I remember in the previous parliament people on this side of the parliament were able to bring forth statistics that indicated that levels of productivity in this country, for instance, were not in correlation or connected with a loosening up of the industrial relations system.

The member for Eden-Monaro went on to talk about the unemployment rates at this time being in some way connected with the previous government and industrial relations. We know what happened internationally at that time: there was the US housing crisis and the global financial crisis. We know that it is also related to contractions in mining demand from China and India. These are the factors that dominate with regard to employment levels. He said today that this legislation is going to lead to some massive job creation and will totally liberalise employers' willingness to hire people—he described it as 'job creating'. I was interested to note that he said that the government did want workers' conditions to 'improve over time'. So the message is: intense suffering through changes such as this and the hope that things will eventually improve.

He spoke of Labor unwinding bipartisan workplace changes. I think that clearly this is a significant change away from the middle ground. It is in the context of a decisive downgrading of the industrial relations power of the union movement. He talked about a correlation between unemployment and liberalised marketplaces in regard to labour. We see at the moment, in the United States, Obama struggling to try to lift the minimum wage from $7.25 to $10.10 by 2016. Its level now is lower than in 1978. That is the reality of deregulated labour markets, an ineffective union force and campaigns to make sure that unions cannot get membership and that people are intimidated into not joining.

If we look at unemployment levels in the United States and Australia, if I were going to be a total mutton-head on this whole issue, I would argue that there is a direct correlation between the United States' low unionisation and high unemployment in the country over a long period of time. That has not been the case. It is not connected. We know that there are intrinsic reasons in many economies as to why there are particular levels of unemployment.

The member for Eden-Monaro talked about being concerned about unemployment. I have more respect for senior economist Brian Redican, from the Macquarie Bank, a former Reserve Bank economist, about the possibilities of where unemployment is really going to come from. In an article on 17 January this year in the Australian Financial Review, he said:

Clearly the direct effect of spending cuts is less spending in the economy and there will be less employment as a result …

… The question is whether the potential benefits of that less spending, lower interest rates for example, provide a bit of an offset. While they might provide an offset, usually the benefit is further out. Whereas the spending cuts start affecting employment negatively immediately.

So the reality is that this budget is going to have a lot more impact on employment and the possible retraction of spending, with the sacking of public servants, than a liberalisation of workplace conditions.

Amongst the aspects of this bill that cause concern are the way in which these agreements can be entered into between an employee and an employer to provide a more flexible workplace. That is intelligent. Everyone supports that concept. If both sides of the industrial relations barrier decide individually that it is better to sacrifice a few penalty rates to facilitate something that affects the family—to let the bloke go and train the football team once a week or to help the woman to help at a canteen on the weekend et cetera—forgoing some kinds of conditions for that is a sensible way of operating, and there should not be interference from the trade unions in that. That is already a distinct possibility in the current operation.

But we see here that they are setting up a defence for employers who intimidate individuals to give up conditions by having them sign these agreements. It is supposedly a defence for the employee, but what it really becomes is a form of evidence for the employer later that the employee really knew what they were doing at the time. In some cases, it is going to be by coercion because it is more advantageous to the employer for the employee to agree to that. Also, we know that certain conditions in the existing measures in regard to how much that financial loss is and whether it is comparable or in some ways commensurate with what is sacrificed are being abandoned here. As well as that, there was previously a condition that there would have to be prior information to the ombudsman in relation to these changes. All of those things are scrapped. So we see, effectively, not a change that will facilitate the employee's right to give up a few conditions in return for something that is important to him but a situation where power shifts very massively to the employer so that they can get what they want.

I am also concerned about these greenfield site provisions. To me, they are essentially a recipe for getting in the unions that are more compliant, regardless of how much support they have from the workers on the site. If there is a union that is not desired by the employer, one can be certain that the deal will be reached with one that is seen as more willing to toe the line—the typical HSU that we have seen in the last few years with its national officials. That is the kind of body that is going to be called in and will be preferred over other unions that basically are not as inclined to go along with things.

I think this measure is not defensible. It is not about helping employees. It is not about trying to have a middle ground or to have a sensible compromise. In regard to these new greenfield sites, we are also going to see a method for employers to essentially negotiate with themselves. It will be a fait accompli for the employees, regardless of their intentions about which unions they want to have there. Finally, of course—under some kind of rhetoric about employee representatives flying around in luxury aircraft—the question about right of entry will involve severe restrictions. It is now very much the employer's argument as to how much they think their place is violated or interfered with by the workers' representatives' attendance that is going to predominate when people get entry.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

It is always a pleasure to follow the member for Werriwa, who is from an iconic Labor family, who is clearly knowledgeable on the subject he just spoke on and who does his research. It was also interesting to hear the member for Moreton in his address. He is obviously passionate about occupational health and safety because of his experience with his family in workplace situations. All of us, every one of us who comes into this place, bring what I would call our own baggage. It is the baggage of our past, our experience, our experience with the union, our experience with business—wherever we have come through.

My desire to have more flexible workplaces in this country is because in my business activity we had a flexible workplace, just as the member for Werriwa described. He even said that there is a place for flexibility in the workplace. In my years in business, many of the people who worked for me wanted to work between nine and three. They did not want to work from nine till 5.30. They wanted to be home when the kids came home from school, so we allowed in our business for that to happen. I do not know whether it was lawful at the time under the award—it probably was not—but that is the way they wanted to work. We were quite prepared to be flexible in that approach and bring in other staff when needed.

Innes Willox was mentioned by the member for Werriwa. As the head of an industry body, he was asking for more flexibility in the workplace. In this place, we have flexibility in the workplace. I cannot say it is an even workplace, for members elected after 2004, but I can say we have some flexibility in what we do here. The dividing line between the Liberal and National parties and the Labor Party, which is born out of the union movement, seems to be our position on industrial relations. But at least in this great south land we can have a discussion. We can hear from the member for Werriwa—and I believe we will shortly hear from the member for Charlton a passionate address in defence of the current legislation as it stands. But that current legislation as it stands is harder on the workplace than even that put in by Hawke and Keating in previous governments. It goes further on behalf of the worker and reduces the flexibility and the opportunity for the workplace to be a driving force of economic uplifting for the participants—for the employer and for the employee.

I know in this country right now that every employee is not perfect and every employer is not perfect and we do need industrial relations laws that say, 'Here are the things you cannot do.' We do not want workers in this country treated poorly by their employers—and there will always be rogue employers. But we need flexibility in regional areas. You heard the member for Werriwa talk about how a 25 per cent reduction in penalty rates was supported by the hospitality industry. I have had delegations of employers come to me and say, 'We can't open on the weekend because we can't pay the penalty rates.' You have heard me say this before, Mr Deputy Speaker Kelly. The only businesses that are open on the weekend are those family-run organisations where it is mum and dad and the kids behind the counter, running the show. A mayor came to me and said, 'In my tourist town on the highway, which we have encouraged to grow by having tourists stop, the businesses are all closed on the Sunday and Monday of a long weekend because they can't pay the penalty rates that are needed.' He was pleading with his own businesses to stay open. These are the sorts of issues that we will grapple with.

The member for Eden-Monaro was mentioned. He is a passionate advocate for more flexibility in the workplace, as I have been in the past. I have never walked away from the position that John Howard put to the Australian people, where we opened up the opportunities for better workplace activity and greater opportunity. I have been described sometimes as a Liberal leftie, and there have been all sorts of angry other notions about my position in life—

Stuart Robert (Fadden, Liberal Party, Assistant Minister for Defence) Share this | Link to this | Hansard source

That's appalling!

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

Absolutely appalling! But, every time rates go up, every time the minimum wage goes up, somebody at the lower end loses their job, and I have always been annoyed that the union movement did not care about that. Do I want to support low-paid workers? Absolutely, I do. But I also do not want them taken out of the market because the employer cannot justify the minimum wage in their case. I believe, if the minimum wage were lower, the government could top it up with benefits for families, for employers and for low-paid employees, as we already do through family tax benefits and other payments for what I call the working poor. It is more important for me that they have a job.

I am not against a nurse who chooses to work on the weekends—Friday, Saturday and Sunday nights—and gets a very heavy penalty rate for that. I am totally supportive of that because it is the choice of that person and the employer for them work on those difficult nights—probably their busiest nights sometimes, as far as casualty goes. They get more money for doing that, and they choose to do that, rather than working through the week, because it suits them to work on the weekends, when their husband or partner—or whatever you have got to call it these days—is at home. They choose to work on the weekends and they choose to work nights. They provide a magnificent, amazing, valuable service for every one of us that needs their services, and they provide it 24/7. Because of my own experience with ageing parents and other issues, I know that, yes, we do need them in the middle of the night sometimes—and, yes, we have received, as a family, magnificent support from Casey Hospital and the services around Casey Hospital when in need. And the private hospital of St John of God at Berwick does magnificent work.

I dare say they have rules and regulations. I noted the importance of occupational health and safety when I went and visited the Bonlac—or Fonterra, it is called now—milk factory at Darnum. In our visit, they explained to us the occupational health and safety rules that we would have to adhere to, just on a visit in a suit—we were not gearing up and going into wet areas. Even to walk down the stairs from the office, we were told, 'You will hold the rail on the way down the stairs.' I was thinking, 'They're taking this occupational health and safety to extremes here.' No. They have had experience whereby they know they need these standards of occupational health and safety in that factory. Who is it for? It is for the benefit of the workers in that factory—no other reason. It is not for the health and wellbeing of the factory and its operators or Fonterra, the international operator; it is for the health and wellbeing of the workers in that factory.

Matt Thistlethwaite (Kingsford Smith, Australian Labor Party, Shadow Parliamentary Secretary for Foreign Affairs) Share this | Link to this | Hansard source

It's for the health and wellbeing of everybody.

Russell Broadbent (McMillan, Liberal Party) Share this | Link to this | Hansard source

Well, the health and wellbeing of everyone, including those of us who visit. It was a real eye-opener how much time is taken, how many meetings are held and how much work they put into occupational health and safety in that factory, and their record since the introduction of these things has been magnificent.

This legislation I support because our party and this government are putting forward some worthwhile changes. It is not about the money; it is about the families that work in industry right across this country. If we can do a little bit to make it easier to grow the opportunity for work and young people especially—I am passionate about them getting into work in the first place. There have been some budgetary measures—we will talk about them when we come to the appropriations bill—that make some changes to the way we encourage young people into the workforce. Some see them as harsh; I see them as a philosophical change of how we look at getting young people into the workplace. The greatest gift we can give a child is an education, but after that the greatest gift we can give anybody in the community is an opportunity to work. Their self-esteem is enhanced. They do not go onto a benefit straight away; they go into a job. They go into a place of opportunity. They go into socialisation. They go into a workplace where they have other people who will encourage them to do better as we chase excellence in this country in every area of our workplaces.

It is a changed community, as the member for Werriwa said, and a lot of the changes are happening regardless of what governments legislate. It has been put to me that the very-high-unionised areas are diminishing in their place in our economy and the more flexible areas are a place of growth in our economy. I dare say there will be those members who present arguments to show me that is wrong. I look forward to those arguments. But I cite our car industry and say—not our car industry but international companies' car industry—they could choose when, where and how they come and go, to the detriment of this nation. No-one was more passionate about football, meat pies and Holden cars than me. I loved the life that I lived near the Lang Lang Proving Ground, having friends working at the Lang Lang Proving Ground—a Holden proving ground—and noting that General Motors-Holden are going to continue with the Lang Lang Proving Ground for the work that they need to do with the cars they are going to import into this country. We went through the best of times with strong manufacturing supported by government. I am afraid we have run out of money, and the downside for all of us is to not have Holden or Ford produce here. I think that is an absolute tragedy, but you cannot continue propping up organisations forever at any cost. I am not an at-any-cost person.

I hope that when this legislation is passed there will be people who get real opportunities in the workplace that they would not otherwise get. I hope that we can have in this House a very strong debate, a good debate. There might be an opportunity out of this debate or out of all the debates that go on for business and the workforce to begin to set some parameters in Australia that we can both agree with. I am not talking about an accord; I am just talking about some basic tenets of where we are coming from in this nation with regard to industrial relations. That is a cooperative event between unions and business.

They should not need to have the government legislate to have the workplace be the workplace we want it to be in this nation. We will all have different views about that workplace; but, if we can just give that flexibility and opportunity for employees and employers to come together, I have no problem with union involvement in that. I think there is a place for the union movement in this country—I have never walked away from that—but it should be a matter of choice, it should be a matter of opportunity for people and, if you are going to have access to the workplace, it should be genuine access to the workplace for all the right reasons. I am probably talking about a perfect world. So be it. What is it—shoot for the moon and you may end up in the stars, but at least you've had a go. I think that, with this legislation, there is a great opportunity here for us to do better than we are doing today. I encourage the parliament to have that conversation. Thank you.

Pat Conroy (Charlton, Australian Labor Party) Share this | Link to this | Hansard source

It is always a pleasure to follow the member for McMillan. I might disagree with what he says, but he always raises good points in a reasoned manner and in a genuine attempt to put forward his points of view. I am sure the member for McMillan was a good and decent employer in the private sector when he was there just as he is a good and decent MP now. My concern and the concern on this side is that not every employer is good and decent. We are worried that flexibility sometimes is a one-way street; flexibility is code for the employer making decisions and imposing those on the employees with little regard to the quality of life of those families. I start this by completely acknowledging the very legitimate point of view from the member for McMillan and the points he raised. Some of them I will address before I go into my substantive contribution.

The reason we have industrial relations legislation—in fact, the reason we have trade unions—is a recognition of the fundamental imbalance in the power relationship between employees and employers at the workplace. While there are good employers, and I am sure the member for McMillan was one and still is one as an MP, there are employers who have greater power than their employees and use that power to exploit them for their own advantage. That needs to be regulated so that the workers of this country do not suffer and have the right to earn a decent wage, the right to have legitimate time off with their family, the right to raise their kids and the right to live a good-quality life.

I will touch on penalty rates, because that was touched on before, as well. The member for McMillan talked about penalty rates preventing people from opening up on Sundays, and it is a legitimate concern. But I took my mother-in-law and my wife, who recently became a mother, out for lunch on Mother's Day, and we went to a café that was not a family café. They employed predominantly young women who were uni students and were being paid penalty rates, and that helped them to get through uni. We were happy to pay a Sunday surcharge of an extra 10 per cent on the bill in recognition of the fact that these people were giving up their Mother's Day to work to earn a living. So penalty rates are very important.

I was interested in the comments by the member for McMillan about a hospital. My wife is a nurse, and I spend a lot of time socialising with nurses. A lot of them work outside standard hours to get penalty rates by choice. It often helps family arrangements in that the husband or the wife might able to mind the kids on weekends. But often these families work those hours because penalty rates are the difference between them paying their bills and not paying them. They do not make a choice; they are forced to work these hours to attract the penalty rates to pay the family bills. So any attack on penalty rates is an attack on families' abilities to manage their budget, and that is something we are very worried about.

I was also interested in the previous member's contribution about the auto industry. It is a great tragedy that the auto industry went. It was entirely avoidable. It was entirely due to the current government making a decision to cut funding to that industry—$500 million was cut. Before the last election, Holden said, 'If you cut assistance, we will go'. Anything else is complete rubbish. The member for McMillan makes a very good point that his personal view was that he was not prepared to keep on paying that bill. I understand that point of view. At least it was an honest approach, rather than the fraud conducted by some of his frontbench colleagues. But the auto industry provides a classic example of how the Fair Work Act worked to provide flexibility for workers in the industry.

During the global financial crisis we had a very significant downturn in demand for automotive vehicles; we had all three manufacturers facing constrained demand and the need to take drastic action. They could have simply slashed their workforce, but they worked with their workers and the unions and agreed to use up annual leave, have training days, and work four days instead of five days a week, and they got through the crisis without having to lay off significant numbers of staff. So there was flexibility in the industrial arrangements that allowed that to happen when workers, industry and the unions came together to work in a cooperative manner, and that flexibility exists in the current legislation.

As an aside, the wages in the auto industry were competitive with the rest of the world. They were certainly less than the automotive wages being paid in Japan and Germany and comparable to those in significant parts of the United States automotive industry. Productivity was healthy; we were making great cars. It was a government choice to remove assistance and condemn 50,000 workers to the scrap heap with a huge impact on another 200,000 jobs. That is an aside, and now I will return to the substance of the bill.

As I said, Labor is the party that supports fair workplaces and supports working together with businesses to get the best outcome. We have a proud legacy of industrial relations policies that have strengthened the nation's economy. We have supported workers through fair and equitable social wage systems and have delivered important improvements to pay and conditions that benefit all workers. This is in contrast to those opposite, who have a sordid record of divisive IR policies and a history of stripping away rights from workers. And we are right to be sceptical of their motives regarding this bill.

With the scale of reform represented in the original Fair Work Act, Labor recognised as best practice a review of the operation of the legislation within two years of implementation. The post-implementation review panel consulted widely with unions and employer organisations. The panel also conducted extensive round tables with key stakeholders. Labor has respect for the process, and whilst in government we responded to some of the recommendations eventuating from this review. Before the election, the Prime Minister promised he would not go further than directly implementing the recommendations from this review. However, at first glance it appears that the government is breaking that promise with this bill. The only appropriate course of action with this bill is to refer it to a Senate committee, where the details of the changes can be reviewed properly, because we are right to suspect the Liberals' motives when it comes to industrial relations. Their record is appalling. It is a record of attacks on workers, attacks on workers' rights to organise, attacks on the rights of families to have a decent wage and to raise their kids.

Significant changes to the Fair Work Act are proposed under this bill, including changes to individual flexibility agreements, greenfield arrangements and right-of-entry proposals, and the government has clearly overstepped its election promise by using tricky language to tilt the playing field. Let's take the amendments to the individual flexibility arrangements as an example. IFAs enable an employee to swap a relatively insignificant monetary benefit for a non-financial benefit that suits both the employer and employee. Labor has always supported genuine flexibility in the workplace, and we introduced IFAs because we agree that flexible work practices can deliver benefits to both employees and employers if applied appropriately.

At the same time, however, we made sure low-paid and vulnerable workers were protected by ensuring sufficient safeguards in the legislation so that IFAs could not be a means of ripping away conditions such as penalty rates. The government is now seeking to insert the model flexibility term into all enterprise agreements, but what they are actually doing is abandoning a key safeguard when it comes to what can be traded away through an IFA. The panel recommendation states that if a non-monetary benefit is being traded for a monetary benefit then the value of the non-monetary benefit forgone must be 'relatively insignificant', and the value of the benefit must be 'proportionate'. But these important terms—'relative insignificance' and 'proportion'—are absent from the government's amended bill. That the full recommendation is missing is alarming and is a reflection of what we know the government means when they talk about flexibility. It only heads one way—against the workers.

We only have to look at the WorkChoices experience to get an understanding of that. With WorkChoices the Howard government stripped away crucial support and protection for workers. They stripped away unfair dismissal protections for huge numbers of workers—millions of workers. They stripped away the safety net, and they introduced flexibility. What that flexibility in Australian workplace agreements meant was that employers were able to present on a table to an employee an individual contract—a template not developed in consultation with that worker to say, 'You need these days off because you have family carer requirements', or 'Let's look at this so you will work a shorter day so you can pick up your kids'. It was a boilerplate template of an individual contract and the message was, 'You sign this or you'll get the sack', and you have no unfair dismissal protection. As a former union organiser, I saw this too often. I saw the most vulnerable workers in the community presented with not flexibility agreements but agreements that drove down their wages and stripped away leave entitlements, and they had no rights. I fear that the changes in this bill are the thin end of the wedge, the start of a process where we will get to where we were with WorkChoices.

Another change is the creation of the 'genuine needs' statement, which asks employees to testify that they believe their arrangement meets the needs and leaves them better off overall. Despite being yet another policy position, the Liberal's failed to declare before the election that this appears to do nothing more than set up a legal defence for employers who find themselves prosecuted for breaching the act by leaving workers short-changed.

The Fair Work Act Review panel did recommend the act be amended to provide a defence to alleged contravention of flexibility, but the proposed amendment is not in that spirit. So, while we acknowledge that the Fair Work Act should be, and has been, subject to a review of its operation, the mechanism on the whole is working well. Indeed, the post-implementation review states that in their view:

The current laws are working well and the system of enterprise bargaining underpinned by the national employment standards and modern awards is delivering fairness to employers and employees.

Let us look at the evidence. Over the last five years, Australia's average Labor productivity growth has been twice that of the OECD average. Contrast this to the two periods of sharpest decline in productivity growth, one which occurred under the Fraser government and the second which occurred under the Howard government's very decentralised wages system that attacked workers. Likewise, as noted by the review panel, the number of days lost to industrial action under the Fair Work Act remains within the band of historically low levels. Under the previous Labor government, almost one million jobs were created at a time when the world faced the greatest economic crisis since the Great Depression.

So let us look at the evidence. Under the Fair Work Act, Labor productivity was twice as high as the OECD. Contrast that with the appalling Labor productivity under the Howard years. We had a million jobs created and we had a record low number days of industrial action. Those on the other side are heavy on rhetoric. When you look at the data: the Fair Work Act is working, industrial disputation is low, Labor productivity is high relative to the rest of the world and there is no need to change it except to attack workers.

We are proud of our record in industrial relations. The Labor government in the Hawke-Keating era introduced the prices and income accord. Labor also introduced enterprise bargaining and protected workers' entitlements. The only time those on the other side cared about workers entitlements was when John Howard's brother was involved in corporate collapses and National Textiles.

It was a Labor government that set up a strong and independent umpire in the Fair Work Commission. It was a Labor government that introduced Australia's first ever paid parental leave scheme that was not an entitlement in terms of national welfare; it was a welfare measure which meant that everyone was paid exactly the same wage, not dependent on their income. And Labor fought and broke WorkChoices. On the other hand, we saw the divisive industrial relations system under the Fraser government. We saw WorkChoices under the Howard government. We saw the single most appalling act of industrial relations in 1998 under the Liberal government, the attack on the waterfront, where the government of the day conspired with the employers to illegally sack a mass workforce for no other reason than to break a union.

Everything else is pure mischief—that is the base fact. They conspired with workers to destroy a workforce to break a union. Everything else is rubbish. Since taking office this time, the Liberals have sat idle while more than 63,000 full-time jobs have been lost across the economy. Now they have laid the ground work for a full-blown attack on penalty rates of the hundreds of thousands of casual and part-time shift workers.

As I alluded to before, as a husband of a nurse, I know the importance of penalty rates—not just for manual workers but for white-collar workers in hospitals, for police and for other emergency service workers. Penalty rates are the difference between family budgets keeping families' heads above water or going to the wall. It is sad to say that this is a part of their broader attack on working families through the budget where we see cuts to family benefits and cuts to the pension driving up the price of petrol through more broken promises, attacks on the safety net, a GP tax, a tax on bulk billing and workers paying more for medicines. This is a government that does nothing for workers except attack them and amendments to the Fair Work Act are a part of that process.

Labor is opposed to these amendments because they are not good policy. It is not even good politics to attack workers. It just reveals again the ideological bent of those opposite. Unfortunately, for every member for McMillan, there are 10 on the other side who just do not care about workers.

David Gillespie (Lyne, National Party) Share this | Link to this | Hansard source

I rise to speak on the Fair Work Amendment Bill 2014, which is all about implementing our key election commitments and injecting common sense back into Australia's workplace relations system. We campaigned in 2013 over improving the fair work laws and that is what this amendment is doing. With broad consultation from employees and employers, the government is implementing many of the common-sense suggestions that we have received, regarding right of entry, individual flexibility agreements and greenfield site agreements.

In my electorate there have been an enormous number of people concerned about the rigid and the very complex arrangements with regards to the current industrial relations policy that we have inherited from Labor. They have gone way beyond what Labor promised at the 2007 election. In my electorate in particular, we do not have huge greenfield projects but we have an awful lot of small businesses, which depend on flexibility. Without our small business sector, most people will be unemployed in our region. This constant one-size-fits-all approach by the Labor Party to workplace relations has crippled many of our two million small businesses. Many small businesses over the last six years have downsized, put staff off and closed. As well, the red tape and the cost of red tape have impacted on the ability of small businesses to retain staff, let alone their confidence to generate more jobs.

As far as this bill is concerned, we will only be implementing our election policy and enacting a number of the recommendations from the Fair Work Act Review panel from 2012, which was commissioned by none other than our current Leader of the Opposition, Mr Shorten.

As I mentioned, small business is the engine room in our part of the world. If small business is doing it tough, people looking for employment are doing it even tougher. But also in industries like building and construction, retail and tourism, some of the industrial inflexibility is putting major limitations on the growth those businesses. Our federal income tax receipts from company taxes are down when small businesses are struggling. The Howard, Keating and Hawke governments recognised this and that is why the reforms they put through then delivered greater flexibility into Australia's industrial relations system. In the 1980s, 1990s and early 2000s, the changing nature of the industrial relations schemes developed huge productivity gains for the nation. We saw expansion that we had not seen since the 1950s and 1960s. Unfortunately, the Rudd and Gillard governments ended this through a range of decisions which pushed the pendulum way back in the other direction, taking industrial relations backwards and not improving them. They delivered much more power to the unions. Employees and employers lost the flexibility in their workplace arrangements. There was a lack of regard for the important flexibility that small businesses need to remain nimble, cost-effective and to get the huge productivity gains they require, and these depend on flexibility. That is why so many of my small businesses have had to resist putting on new staff or have actually downsized.

Some may criticise us for not going far enough, but the reality is—as the Prime Minister has said on many occasions—that we will do what we said we will do and we will work with the existing Fair Work Commission. These amendments will stick to that principle. Through the Fair Work Amendment Bill, we are first of all addressing these greenfield site agreements, where the unions can and have been frustrating the bargaining process for way too long. They are making these agreements and the projects that they underpin incredibly costly and unproductive. You have only got to see what has happened in some of the major energy and mining projects that have gone by the wayside. Ten or 15 years ago Australia used to be a low-cost country for the development of mining and large industrial projects but, with all these rigidities and ridiculously unrealistic and unsustainable greenfield agreements, a lot of the huge investment has walked out the door and gone to other parts of the world. People need to start connecting the dots: if our costs are too high, the capital that is invested in Australian projects will come to an end, because there are places in the world where costs are lower.

That aside, I will return to the topic. Restoring union workplace access rules—reflecting those in place prior to Labor's unbalanced arrangements—is our priority. Good-faith bargaining should commence with a formal notification and then a three-month period of good faith negotiation by both parties, rather than what we have seen where—instead of good faith bargaining—we have the strike first and talk later scenario. That is what is employed in a lot of these greenfield arrangements. We need to address this.

The other thing that I have spoken about is the individual flexibility agreements. They are an important tool within the existing legislation, but we need to make them bear fruit with these amendments. As long as the principle of better off overall is applied, which is envisaged in this legislation, things should work. There should be a monetary value capability that could be used to offset non-monetary values in an agreement. As long as the employee and the employer see the benefit of that, it will be of benefit to everyone—that is, the employee and, most importantly, the business. These sort of flexibilities are very relevant to small businesses. It might be prohibitive, but affordable, if you are doing a $2 billion or $3 billion project that you must get off the ground, but if you are a small business operating a convenience store, a coffee shop, a milk bar or a light industrial business in Taree or Port Macquarie, that lack of flexibility can sink your business. That is why this is so important.

With the agreements parties should engage in negotiations and payments that are consistent with the prevailing standards and conditions. We should not have inordinate delays and costs, and we should not have strike action as a reflex action to intimidate employers. Under these amendments, employers as well as unions and employees are compelled to negotiate in and complete the bargaining process. It does not sound ridiculous. It is just basic common sense that we are applying here.

The other issue is protections for workers. Protections for workers do remain amongst these amendments. Unions have to be involved, and those that are involved must be recognised in these agreements. We need consensus across both parties. These amendments are not displacing the union; they are just applying common-sense principles so that the ability to veto an agreement is no longer the trump card in any negotiation. It has to be a two-way street to get a good outcome.

If we had had sensible agreements in place in some of these major sites in South Australia, Western Australia and Queensland, some of these larger projects would have gone ahead, I am sure, because, when you are investing billions, the costs ratchet up so quickly if you have unrealistic and unsustainable conditions. I can think of three businesses that are no longer with us in the Lyne electorate. I have spoken to the business owners. They are not new start-ups that have failed; they are businesses that have been around for 15 or 20 years and, one of them, for 25 years. Over the last three years, they have gone—not because they did not know how to run the business; things just got too hard for them. It was too hard for them to sell their business because new people did not want to take on this rigid system.

The other issue that these amendments address is right of entry. One only has to have read the dailies for the last couple of years to know the stories of unrealistic rights of entry being manipulated by the unions. What business can cope with two visits a day, unannounced, by union representatives to the workplace or the meal room? That is more intimidation than negotiation. These amendments will address that issue so that that behaviour, which is not reasonable, is no longer allowed.

Another aspect of right of entry is that the cost of travel to remote sites was being forced onto the employer or the business, rather than being paid for by the union. One could have union negotiators—with the right of veto, with the threat of striking first and negotiating later—visiting these sites at remote locations without any negotiation with the employer. Clearly, that is unrealistic and unreasonable. We are not trying to get rid of unions in the negotiations. We are just trying to apply common sense and common business practices. The bill will allow for a convenient site to be nominated for negotiations and it will stop the abuse of right of entry.

If there are other issues that come up in the good-faith bargaining process, a reasonable period of time needs to be set aside so that the negotiation process can continue. Now, three months is a reasonable amount of time to achieve that. But, if, after three months, it is not achieved, obviously it has to go to arbitration. If there is a flexibility issue that needs to be negotiated, there are provisions so that the employer notifies the employee and vice versa. If the employee agrees that they are no worse off, I cannot see why that should not go ahead. That is why we need these amendments—to allow that to occur.

If the situation changes, there are provisions under these amendments to give formal notice to cease the individual flexibility arrangement and to renegotiate it, or to revert to the broader agreement. There are also provisions so that individual flexibility cannot be limited to some microsection of the agreement. If the employer and the employee want a very wide ranging individual flexibility agreement, they should have the right to do that, because that delivers productivity and it delivers profits for the company, which then means they are happy to employ people. I commend the bill to the House. (Time expired)

Andrew Giles (Scullin, Australian Labor Party) Share this | Link to this | Hansard source

I rise in opposition to the Fair Work Amendment Bill 2014 and in support of the amendment that has been moved by the member for Gorton. It is a pleasure to follow the member for Lyne, who made a typically thoughtful contribution and a very sincere one, no doubt. While I disagree with almost every component of it, I say at the outset that the one matter that the House's attention must be directed to is the assertion that this bill implements the government's election policy. That is simply not the case, and I will turn to that in the course of my contribution.

On a very similar note, before the election, the then Leader of the Opposition and now Prime Minister stated that the coalition wanted to 'protect workers' pay and conditions' and promised—I think this might have been a 'solemn promise', but I am not sure what standing solemn promises have in the lexicon this week—that he would be the best friend of Australian workers. That was before the election. With this week's budget, we know how much such a promise is worth from Australia's Prime Minister. In the budget, alongside cuts to health, cuts to education and real cuts to pensions—all broken promises—we have seen further attacks on workers and those seeking work in a continuation of this government's desire to see a race to the bottom.

In particular, I draw the House's attention to the $1 billion stripped away from apprentices and the nearly $2 billion stripped away from skills programs. These are attacks on young workers. I think of the cuts to Youth Connections, Partnership Brokers and National Career Development. The government are ending programs that have been effectively preventing young people from slipping through the cracks and providing them with pathways to attain education and enter the workforce. A small investment continued in this area would have kept 100,000 young people on track. There are also savage cuts to income support for those under 30. They are being asked to wait six months to receive income support from this cruel government. All of this is from a government without a plan for jobs, save a plan for 16,500 hardworking public servants to lose their jobs.

Half an hour or so ago I read a report on the budget from the Grattan Institute, a body far more disposed towards this government's economic policy settings than I am. What really interested me in this review, which was broadly complimentary of the government's budget, was that the Grattan Institute CEO, John Daley, sees the budget as likely to discourage further workforce participation and thinks that it will in all likelihood hinder people in finding what he described as 'proper long-term jobs' and so reduce workforce productivity in the long term. So much for the rhetorical flourishes around this legislation and from the government more generally.

Turning back to our Prime Minister, I do not think Australian workers were looking for a best friend in this Prime Minister, but they want and, indeed, deserve a government that is on their side, a government that will fight for jobs and stand up for fairness and rights at work. This is the context in which we are taking part in this debate. This is a debate that mysteriously started before various state and Senate re-elections but has only now been brought back.

When the member for Sturt introduced this legislation, he claimed that it delivers on key aspects of the coalition's election policy and does not go any further and that the coalition would implement specific recommendations directly from the 2012 Fair Work review. However, the government is going further than its pre-election promises in a number of places and clearly beyond the review's recommendations, which recognise, document and provide evidence for the present arrangements. These matters deserve detailed scrutiny.

In my contribution I want to focus particularly on the proposed changes to the enterprise individual flexibility arrangements and then briefly consider changes concerning right of entry and greenfields. In terms of individual flexibility arrangements, Labor supports flexibility where it genuinely provides flexibility for workers and not simply convenience to employers. In 2009, the then Minister for Workplace Relations Julia Gillard said of the enterprise flexibility agreements clause in the Fair Work Act:

That clause gets the balance between fairness and flexibility right. It provides very, very strong protections for working people, as it should, but enables limited flexibility arrangements for work and family life matters, for example, to be entered into.

I emphasise the mention of 'very, very strong protections'. Very, very strong protections are warranted.

IFAs were not designed to be imposed from above on unsuspecting employees as a means of ripping away conditions such as penalty rates. Getting the balance right is vital due to what seems to people on this side of the House the very obvious power imbalances at hand. And yet, post the election, we see exactly this in recent coverage of the government's true intentions in this regard.

In an article titled 'Coalition MPs plot to strip penalties' in The SaturdayAge, the Minister for Employment conceded:

… the terms of reference for the Productivity Commission's review of workplace laws were deliberately broad enough to cover ''a full and thorough analysis of all aspects of the Fair Work Act''. And the draft terms of reference explicitly mention ''pay and conditions'' and ''industrial conflict'' - which is widely understood to include penalty rates …

Penalty rates, as the member for Charlton set out so persuasively a few moments ago, are so important for the living standards and the way of life of so many Australian families.

I note that there is such a large rollcall of MPs and senators openly agitating against penalty rates, including the member for Leichhardt, the member for Wannon, the member for McMillan, the member for Longman, the member for Mitchell, the member for Reid, the member for Dawson, the member for Tangney, Senator Edwards and Senator Seselja, who were described as seeking to 'liberate' small businesses from having to pay their employees for losing their weekends and public holidays. There is not much freedom there. There is not much liberation for affected workers or meaningful flexibility for those people to manage their work-life balance on their terms.

In keeping with the government's refusal to discuss its plans to smash penalty rates, the Treasurer stated:

'I'm not going to get into a debate about penalty rates. That's what I did for 12 months of my life when I was workplace relations minister and I've expunged it from my memory.'

The Treasurer may wish to forget about Work Choices, but the people of Australia have not and the Labor Party will not. The people of Australia deserve a real explanation about what this government is planning to do in relation to Fair Work.

We have heard ominous remarks by the Prime Minister about wanting to place his stamp on economic policy, and we have certainly seen that with announcements by Holden, Toyota, Qantas—and many other companies who have made similar decisions—costing over 60,000 jobs. The Treasurer, aped by others in the coalition, has stated that it is apparently up to the business lobby to make the case for workplace relations reform. In other words, the coalition has outsourced IR policy to the big end of town, as with its policy settings more generally. We have seen this with the Commission of Audit, which contributed so powerfully to the cruel budget this week. The Faustian pact here seems to be as follows: big business lobby groups simply have to make demands, maybe confect an emergency and perhaps run some ads and the coalition in government will give them whatever they ask for.

This is a government that simply will not tolerate dissenting views about its agenda. In everything from the arts to workplace relations we are seeing an enactment of the Prime Minister's sinister injunction that, 'We expect everyone in the system to be working enthusiastically with us as we reshape our country.' The Treasurer's language of a 'shared burden' is telling in this regard. We are all in this together, but some must do more lifting: those least able to do so. We see Robin Hood in reverse in this race to the bottom.

It seems that the lesson the coalition learnt from the 2007 Work Choices election was not about the Australian notion of a fair go and fair remuneration or a sense of egalitarianism and how Australians see fairness in the workplace and in workplace laws as fundamental to their sense of a decent society. Instead, the coalition was spooked by a grassroots campaign of ordinary working people, organising with their unions, and saw it as a threat that they would need to distract, disable and destroy before future attempts to strip workers of their rights and entitlements could proceed. And what is the end game? We need only look at the United States to see the inspiration: a country where wage growth is stagnant, where inequality is stark—a land of gated communities—and, most relevant to this debate, a country with a permanent pool of low-skill, low-pay and insecure workers, the working poor.

The Victorian secretary of the United Voice union, Jess Walsh, has outlined what was at stake for her members in respect of these arrangements and also for so many others in Australia. I quote Jess:

Members of United Voice rely on overnight and weekend pay rates. Nationally, more than 4.5 million Australians are in industries where these rates apply.

For many of our members, these soon-to-be-tradeable pay rates make up one-quarter of their income. Their work is essential to our community but they are paid relatively poorly, often with a base pay of less than $40,000 a year. So let us be clear: these are not affluent people. They work around the clock, and the very night and weekend shift loadings that they rely on to pay the mortgage and buy groceries and other staples of life are up for grabs.

Flexibility can be a win-win for employers and employees. Indeed, the fair work review expert panel cited data that demonstrates the majority of present enterprise arrangements already provide as much, if not more, flexibility than provided by the 'model flexibility term'—a term that government is seeking now to legislate to insert into all agreements. The amendments proposed by this government in relation to IFAs reinforce why, when it comes to the Liberal Party and workplace relations, the devil is always in the detail. The government is unreasonably proposing that key safeguards be abandoned when it comes to what can be traded away in an IFA. While the relevant expert panel recommendation says that if a non-monetary benefit is being traded for a monetary benefit, the value of the monetary forgone must be relatively insignificant and the value of the non-monetary benefit proportionate. Despite this clear prescription, 'relative insignificance' and 'proportion' are concepts which are missing from the bill which is before us. That the full recommendation is missing is an alarming reflection of this government's approach to workplace relations and probably reveals the genuine intention behind the construction of this important and troublesome provision.

The government has also included a requirement for employees to provide their employers with what it has misleadingly labelled a 'genuine needs' statement. This statement is intended to capture an employee's state of mind at the time the IFA is agreed to. The government has tried to pass this off as an employee safeguard, but what it really does is provide employers with a deferred defence to any future claim to the effect that it has contravened a flexibility term. The Fair Work Act Review panel did recommend the act be amended to provide a defence to alleged contravention of flexibility, but the proposed amendment is not in the spirit of that recommendation. This bill goes beyond the panel's recommendations and much, much further than the coalition's disingenuous election policy. It is a breach of faith with the Australian people at large and particularly for those working families who depend on penalty rates.

The member for Charlton in his contribution talked a bit about flexibility—a contribution that took us through the evidence in this regard and made clear that the case for change, as set out in this bill, has not been made. Before the election, the coalition flagged a requirement for the Fair Work Commission to be satisfied that parties had considered ways to improve productivity before approving an enterprise agreement. The coalition's policy document said it would task the Productivity Commission with undertaking a thorough analysis of the laws and the impact they have. Given this interest in productivity, I read with interest a recent speech by Phillip Lowe, Deputy Governor at the Reserve Bank, at the Sydney Institute—a hotbed of socialism—about demographics, productivity and innovation. Productivity growth is something that I would like to think all of us in this place support. It is how we can collectively increase living standards in Australia. In his speech, Mr Lowe described the challenges and opportunities for Australia in this area. He stated:

Improvements in productivity require existing resources to be used more efficiently … So if we are to improve efficiency and advance technology then innovation is required …

  …   …   …

This means there is likely to be more of a premium on getting policies right in some key areas ...

These measures include:

•   The way in which we finance innovation …

•   The incentives for innovation …

•   The way we support human capital accumulation and research.

•   Our business culture and the way we promote and support entrepreneurship.

•   The way in which we promote competition in our markets, for it is often competition, or the threat of it, that is the driver of innovation.

Noticeably, one supposed threat to, or solution for, increasing productivity that Mr Lowe did not observe was penalty rates or employees' rights at work. It gives the lie to the coalition's grand claim that things like penalty rates somehow impede productivity in Australia. The Howard government made the same untruthful claim when it introduced Work Choices. It was claimed that it would increase productivity; of course, it did no such thing. There is a role for government in enacting a productivity agenda, just as there is in protecting people's rights at work, but it is a positive role that supports people; it does not undermine them.

I turn very briefly to the provisions in relation to greenfield sites and simply observe that this bill goes beyond the review in two important respects.    The three-month termination period provided for is inconsistent with recommendation 30 of the expert panel and clearly tilts the balance too far in favour of employers. Further, there are simply no incentives for employers to bargain under the provisions as set out. This is effectively attempting to exclude unions—diminishing rights in deference to ideology.

Lastly, there is right of entry. As the member for Gorton has already stated, Labor's view is that employees should be free to join or not join a union, if they so wish. The right for employees to organise and be represented is a basic freedom that should be respected. The provisions here do not do that. They go beyond the expert panel's recommendations and are clearly intended to exclude unions and restrict industrial rights. I am committed to opposing the bill in this place and in the community.

Paul Fletcher (Bradfield, Liberal Party, Parliamentary Secretary to the Minister for Communications) Share this | Link to this | Hansard source

I am very pleased to rise to speak on the Fair Work Amendment Bill 2014. This is an important bill, which will restore certainty in the workplace relations system and balance the needs of employers and employees. It is a bill which amends the Fair Work Act 2009 and gives effect to a number of the government's commitments made in the coalition's policy to improve the fair work laws. It includes a range of measures which are vital to ensuring that Australian workplaces can operate as productively and effectively as possible in the immediate term.

I wish to cover three points in the time that is available to me today. The first point is that Labor took the workplace relations environment back to the 1970s. This was a payback by the Rudd-Gillard-Rudd governments to their union mates. The second point is that this is a productivity and efficiency issue for our nation. Indeed, as the previous speaker observed, the importance of productivity is something that those of us on all sides of the House can agree on and that is one of the reasons why we are so committed to these measures; it is with a view to improving Australia's productivity. The third point is that the coalition made clear and explicit promises in our policy in this area before the election, and we are now acting, consistent with our policy, to implement our promises.

Bruce Scott (Maranoa, Deputy-Speaker) Share this | Link to this | Hansard source

Order! The debate is interrupted in accordance with standing order 43. The debate may be resumed at a later hour, and the parliamentary secretary will have leave to continue his remarks when the debate is resumed.