Nick Xenophon (SA, Independent) Share this | Hansard source

Mr Acting Chair, it would be remiss of me not to make a short contribution in relation to this amendment given that I was meant to move it. Instead, Senator Muir, because I was at a meeting with an assistant minister, moved it on my behalf and on behalf of the others who are co-sponsoring this amendment, and I am very grateful for that.

The key issue here relates to the Fair Work review of the Gillard government in 2012. I say at the outset that, in the to-ing and fro-ing between Senator Cameron and Minister Cash, I think Senator Cash has a very worthy adversary in Senator Cameron. I say that in a genuinely complimentary way to test the assertions, to have that genuine debate and to have that review of the legislation.

My position on this particular amendment that I have co-sponsored with a number of my colleagues from the crossbench is that we do need reform in relation to greenfields agreements. What the 2012 Fair Work review from the Gillard government said at page 168 at 6.5.1 in part was:

In particular, Work Choices introduced ‘employer greenfields agreements’, which allowed an employer who, namely the capacity for an employer proposing to establish a new business, project or undertaking to unilaterally determine the content of the instrument that would apply to its future employees. In contrast, FW Act greenfields agreements were to be ‘true agreements negotiated between the relevant bargaining representatives and made by more than one party’.

I think it is fair to say that what Work Choices wanted to do with greenfields agreements was unreasonable. It was unilateral. People's benefits could have been reduced. There was no better-off overall test and therefore that was an untenable position. But what the Fair Work review of a former Labor government said is that there was need for reform. The commentary in relation to this particular section went on to say:

Some employers propose that good faith bargaining principles should apply to greenfields negotiations. The AWU also supports this proposal. The Ai Group considers this unworkable, as it could lead to bargaining with multiple unions competing for coverage in the workplace.

That is something that needs to be considered, but I think the fact that there is a framework here for good faith bargaining is important.

The review panel at 6.5.3 at page 171 said:

We were provided with a number of case studies in submissions and in consultations that suggested the current system of greenfields agreements is not operating efficiently. Employers and their representatives claimed that, in light of the requirement to bargain with a union in order to secure certainty about terms and conditions to apply on a project, they are required to agree to terms that are economically unsustainable. They also claimed that unions withhold agreement to address issues unrelated to the project, which puts projects in jeopardy. Employers say the requirement to negotiate with the union or unions that have majority coverage is partially to blame because it has reduced competition between unions and therefore reduced the likelihood of reaching agreement on satisfactory terms.

That is what a Gillard government appointed panel review said about that. It goes on to say:

The FW Act addressed a key problem identified by the Government with Work Choices, namely the capacity for an employer proposing to establish a new business, project or undertaking to unilaterally determine the content of the instrument that would apply to its future employees.

The panel goes on to say:

We accept that the Work Choices framework conferred greater freedom on employers to unilaterally determine wages and conditions. As we note in Chapter 4, we are not convinced that, currently, the economically relevant outcomes are significantly different.

Clearly, that was unfair. Clearly, it was something that was untenable in terms of the former Work Choices legislation. But the panel appointed by the Gillard government stated:

However, based on the evidence we have received in submissions and consultations, and a review of the data associated with greenfields agreements above, we consider that there is a significant risk that some bargaining practices and outcomes associated with greenfields agreements potentially threaten future investment in major projects in Australia. This is because the existing provisions effectively confer on a union (or unions) with coverage of a majority of prospective workers a significant capacity to frustrate the making of an appropriate greenfields agreement at all or at least in a timely way. Unions in this position are able to withhold agreement and effectively prevent the determination of terms and conditions in advance of a project commencing. In light of the evidence we were presented about the need for certainty over the labour costs associated with major projects, we are concerned at the risk of delays in greenfields agreement making that this entails. We have considered a range of mechanisms to address these concerns. We do not consider that a return to employer greenfields agreements is appropriate.

One of the recommendations was to have some certainty. One of the recommendations was to have a time limit. Having a six-month time limit—as this amendment moved by me and a number of my crossbench colleagues, as tabled—is, I think, a way through this.

I am very happy for Senator Cameron to ask whatever questions he thinks are necessary on behalf of the opposition. I think what he is doing is very important. But the current system of greenfields agreements is not working; it is actually holding up jobs and major projects. Senator Cameron is a champion of workers' working conditions and he is also a champion of jobs. I fear the existential crisis we are going to face in this country, particularly at the end of 2017, when the auto sector in this nation effectively shuts down.

I must say that the recklessness of the comments of former Treasurer Hockey did not help at all. I thought they were reckless comments by former Treasurer Hockey. We desperately must do all we can to have well-paying, good jobs in the economy, in manufacturing and in these major projects that are anticipated in this greenfields agreement. That is why I move this amendment. That is the position I have come from. I hope Senator Cameron appreciates that the position I come from is one about securing major projects and well-paid jobs. Right now we are at a stalemate. Right now one of the unintended consequences of the Fair Work legislation is effectively to stall these agreements because of what I see as a loophole and as something that was not thought through. That is why—to its credit—the Gillard government initiated this review to look at these issues where the Fair Work Act was not working as intended. That is why I support and have proposed this amendment with a number of my colleagues.