Monday, 4 December 2017
Fair Work Amendment (Repeal of 4 Yearly Reviews and Other Measures) Bill 2017; In Committee
The government opposes Labor's amendments. These amendments undermine the independence of the Fair Work Commission and have serious implications for enterprise bargaining. The government's position has always been clear—setting minimum pay and conditions is the job of the Fair Work Commission. The amendments would prevent the commission from ever varying a modern award to make a penalty rate lower than those applied under the award as at 30 June 2017. This ties the independent Fair Work Commission's hands, making it impossible for the commission to make sure modern awards are a fair and relevant safety net for Australian employees and employers.
The commission said that its decision is expected to deliver an increase in the level and range of services in both the retail and hospitality industries, with a consequent increase in employment—that is, more hours of work for existing employees or the engagement of new employees. Its decision means that small business will be able to compete on a level playing field with big business, which has done deals, as I've already articulated in my summing-up speech, with unions to reduce Sunday penalty rates through enterprise agreements. The Department of Employment's submission to the Senate inquiry into penalty rates found that around 65 per cent—70 out of 108—of a sample of large enterprise agreements covering 200 or more employees, which identified the fast food, retail, hospitality or pharmacy modern awards as their parent award, already cut penalty rates for at least one group of workers. Fifty-five of these 70 agreements covered at least one union. Why is it that Labor does not want to allow small business to be able to better compete and gain the benefits the full bench of the Fair Work Commission said would result from its decision? Those opposite clearly do not want to support small business.
In addition, Labor's amendments would not allow penalty rates to be reduced or removed in an enterprise agreement if it would disproportionately affect employees who work on days where penalty rates are payable as compared to other employees. Just how this would be operationalised remains a mystery. It would be very difficult to determine whether someone usually works on a specific day and what is meant by 'disproportionately affects'. The amendments would significantly reduce the scope available for parties to bargain—and I refer to recent figures: the negotiating outcome of at least 65 per cent of a sample of large agreements involved some change to Sunday penalty rates.
Enterprise bargaining allows employers and employees to tailor the conditions of employment to their business, supporting productivity and economic growth. The amendment would stop bargaining in its tracks. The Fair Work Commission already has to compare all the conditions, including pay an employee would receive under the relevant award including casual loadings and penalty rates, when applying the better off overall test. Currently, employees are able to trade off some allowances and penalties for conditions they value more highly or a higher base rate of pay. The amendments would significantly impede this flexibility and undermine the traditionally bipartisan intent of facilitating bargaining and productivity at the workplace level. On that basis, the government does not support the amendments.