After years of declining relevance, the members of Fair Work Australia (the successor of the Australian Industrial Relations Commission) are as busy as they have been for years. And in the year ahead, it’s bound to get a lot busier. Anyone who thought Labor’s fair work reforms might mean less regulation and the continued decline of the industrial umpire now surely knows, after only 100 days of the reforms, that many facets of the old system are on their way back.
That is not to say there has been an avalanche in activity surrounding the Fair Work Act since its key enterprise bargaining reforms took effect from 1 July this year. But the signs are clear that Labor’s antidote to Work Choices is already profoundly rebalancing Australian workplaces.
Despite its political toxicity, Work Choices has left an enduring legacy in Labor’s fair work reforms. A genuine national system, an entrenched legislative safety net for all employees, compulsory secret ballots to authorise industrial action and easier access to common law remedies for employers stung by unprotected industrial action are all key elements of the new Fair Work system. But if there is one word that describes the Fair Work system it’s ‘re-regulation’.
Putting aside the bureaucratic amalgamation of various agencies into the burgeoning Fair Work Australia, it’s the tribunal itself which has emerged as re-empowered, both in respect of its powers to direct parties and enforce obligations and in the more subtle influence it now exerts—especially in the bargaining arena.
Good faith bargaining has emerged as the prime focus of attention over the first 100 days. This is hardly surprising. Parties who do not bargain in good faith can be compelled to do so. More significantly, not bargaining in good faith can prevent an employer from putting an enterprise agreement directly to its employees. Under Work Choices, the AIRC was neutered. Already FWA has shown a preparedness to use these its new powers over the last few months.
There have also been scope order applications, majority support determinations, and cooling off applications to temporarily halt protected industrial action. Some reluctant employers have been told by FWA they must bargain with their employees while others have had their agreement processes halted because they haven’t been bargaining with the appointed union representatives in good faith.
Yet, overall, the level of industrial activity has, been relatively low. There are probably two reasons for this. First, it’s clear that the GFC has dampened unions’ enthusiasm to encourage their members to lose pay in an uncertain economic climate. Second, it’s early days and the new laws are still untested. Unions are typically conservative organisations and the training required for their organisers and delegates will be massive. There are already test cases slated for a number of key provisions. In time, there will be a flurry of tribunal hearings and applications. Nothing is surer. It should not take much time for employers, unions and the tribunal to come to grips with the evolutionary conclusion to be drawn from the new laws – employees have legitimate and defined rights to use economic coercion (industrial action) to propel their industrial demands. And why wouldn’t unions use the armoury of weapons now at their disposal?
What else can we expect over coming months? First, expect to see employers using lockouts much more regularly. As a tactic under Work Choices, lockouts were derided by unions as unfair. As our system now embraces aspects imported from the US, the Australian tribunal will be drawn to precedents and practices from there. In the US, lockouts are just another part of mainstream collective bargaining. And it’s very likely that unions will not receive a sympathetic audience from FWA if they have concerns about lockouts. Second, we should expect a lot more messy and protracted bargaining disputes. By opening up bargaining direct with employees and their nominated bargaining representatives (any employee can self-nominate), there will be challenges to traditional demarcations. Throw in the occasional maverick bargaining representatives and you can imagine problems arising. Of course, the new Act has mechanisms to deal with this, but they don’t come with any guarantees. Third, we are yet to see the impact of the ‘general protections’ and the National Employment Standards. The NES will apply to all employees from 1 January 2010 and will regulate minimum entitlements in areas such as leave, hours of work and redundancy. Award covered employees will also be able to access individual Employment Agreements. Whilst IEA’s do offer some scope for more flexible arrangements, they’re no substitute to AWA’s that were favoured by many employers.
At the same time that the new laws empower collective bargaining, there is an equal boost to enable individual grievances to be pursued. Employers whose recruitment and personnel practices are not up to scratch will be more vulnerable than ever. Even the best employers will have to navigate this minefield carefully.
To put all into perspective, there will never be consensus about whether the Fair Work system is, well, fair. Certainly it’s an improvement on some facets of the old laws which were sticky-taped together and heading in a certain direction. These laws are bound together more tightly, but they’re heading in a different direction altogether.
More information
For information regarding possible implications for your business, contact