Labor’s IR law don’t leave workers better off overall

December 2, 2022

The Secure Jobs, Better Pay (2022) laws, which amend the Fair Work Act 2009, as well as other industrial laws, is being touted by the Anthony Albanese government as a silver bullet to get wages moving and address the gender pay gap.

The Australian Council of Trade Unions (ACTU) claims the changes will “restart progress on closing the gender pay gap through multi-employer bargaining”. It also claims the changes will strengthen equal pay laws and make it easier for women, especially in female-dominated industries “to address systemic unequal pay”.

Secure Jobs will make gender pay equity an objective of the Fair Work Act, as well as the modern award system, by putting it at the centre of pay decisions made by the Fair Work Commission (FWC).

Two new FWC expert panels will be established to oversee pay equity and the care and community sector.

The new laws also makes it easier for the FWC to order pay rises for low-paid female-dominated industries by putting in place a statutory Equal Remuneration Principle, similar to what exists in Queensland.

The FWC can make equal remuneration orders now, however they are costly, time-consuming and highly adversarial. From 21 applications since 1994, there has only been one successful equal pay order.

The law will also abolish the Australian Building and Construction Commission, an anti-union watchdog established by John Howard's Coalition government to police the Construction, Forestry, Mining and Energy Union’s (CFMEU) Construction Division.

Enterprise bargaining with multiple employers is another positive change. It will allow unions to organise protected industrial action in support of bargaining claims across hundreds of workplaces and involve thousands of employees, provided the businesses have a “common interest”.

These positive changes should be introduced, as a matter of principle, by any government claiming to be pro-worker. They should not be used as bargaining chips to amend industrial relations laws, as Labor has done.

The laws contains numerous negative aspects: arguably, they will leave many workers worse off.

The ACTU and Labor claim that multi-employer bargaining is a significant win. However, the militant CFMEU is excluded from taking advantage of these changes, as are workers employed by small businesses with less than 20 employees.

In essence, industrial action will be more difficult to organise and take, as ACTU Secretary Sally McManus admitted on ABC Radio National on December 1.

The new laws will divide workers and weaken the Better Off Overall Test (BOOT). The BOOT is how the FWC assesses terms in an agreement against the relevant award to ensure an employee is “better off overall” under an agreement before it approves it.

When the Scott Morrison government proposed weakening the BOOT, there was an outcry from unions and Labor, because it would leave workers worse off.

The proposed “simplification” of the BOOT will allow the FWC to amend an agreement before approving it. Workers’ or unions’ opinions will not be required, even though the FWC will have to take their views into account when deciding if the enterprise agreement passes the BOOT.

Other affected workers, or unions, that are not recognised as “parties” to an agreement will not have their opinions considered. This has already created divisions.

The Retail and Fast Food Workers Union — wrongly described by some as not being a “real” union — which has campaigned successfully for young workers’ rights in the retail and fast food industries, is rightly concerned it will be sidelined.

Predictably, business lobby groups, including the Australian Chamber of Commerce and Industry and the Australian Industry Group, as well as the CEOs of Wesfarmers and Qantas oppose the bill and have scaremongered about “industrial chaos”.

So-called “lawful” industrial action is already very difficult for unions to take. Members must be balloted before the FWC approves the union taking industrial action.

Fifty per cent of the relevant union members must participate in the ballot and, of those, 50% +1 must vote “yes”.

For larger public sector agreements, this is a mammoth task for unions, requiring months of organising work to make it a success.

Unions also need to demonstrate to the FWC that they have attempted to bargain in good faith, as part of the process of applying for a protected action ballot order.

Any union, or workers, taking industrial action outside this constrained system, face heavy fines.

The new laws will make taking industrial action even more difficult. A new “mandatory conciliation” clause has been introduced before any protected action ballot order can be granted.

The intention of this clause is to ensure industrial action — workers’ most powerful weapon — never gets off the ground.

The mandatory conciliation clause will force union officials to make deals rather than consult union members on an offer from the boss — including the possibility of taking industrial action if members aren’t happy with the offer.

The FWC will also have the power to arbitrate where both sides seem to be uncompromising. This is another way to halt industrial action and reduce workers’ power.

For the past 30 years, disputes have been resolved through agreement, not by a government body imposing a resolution. Imposing an “agreement” could leave workers worse off.

Finally, employers will no longer be obliged to give employees information about any proposed enterprise agreement (EA) and information on how, where and when they can vote on it, in the seven days leading up to a vote.

Consequently, determining whether employees have “genuinely agreed” to approve a proposed EA will no longer rely on whether they have been given sufficient information by the employer, but whether they have a “sufficient interest” in the terms of the proposed EA and are “sufficiently representative” of the employees the EA is covering.

There was no chance to fully scrutinised to assess their impact the last-minute amendments, arising from deals with independent Senator David Pocock.

Industrial campaigns help unions grow, as members become involved and more empowered.

Prohibiting or restricting this in favour of conciliation disempowers workers. It undercuts the ability of unions to effectively organise in workplaces for better conditions and wages, and also limits unions’ growth.

The last decade has shown that a decline in industrial campaigns means fewer workers signing up as union members, which allows for conditions to be more eroded and wages to flatline.

The Fair Work Act needs a complete overhaul to repeal all penal powers and sanctions against workers and their unions exercising their right to take industrial action.

The positive changes in these laws are too few.

The amendments make it harder for workers to exercise their democratic right to withdraw their labour to achieve better conditions and wages, and must be called out.

Unions also need to mobilise and campaign independently of Labor which, under neoliberalism, is hardwired to appease the bosses’ interests rather than those of workers and their unions.

[Mary Merkenich is a long-term unionist and member of Socialist Alliance. Sarah Hathway is a national co-convenor of Socialist Alliance and a unionist.]