According to the federal government, the Closing Loopholes legislation is a commitment ‘to getting wages moving and strengthening enterprise bargaining’. For employers, it feels like the thin end of the wedge.
The legislation is deliberately complex while simultaneously too vague to determine its implications. The only thing we know for certain is that the 284 pages of legislation and accompanying 521-page explanatory memorandum will keep lawyers in their fine suits for decades.
The Business Council of Australia saw the danger early saying, ‘Hundreds of key decisions are left to regulations, the Fair Work Commission, yet to be determined codes, or the unilateral power of the Minister.’
Possibly the most significant aspect of the bill is the change from 12 to 6 months for casual conversion, alongside a raft of subjective tests to determine it. The new rules weaken discretionary power for employers within the workplace while introducing significant risk in rejecting requests for casual conversion while demonstrating no significant benefit for employer, employee, or productivity.
Casual employment affects 20 per cent of the workforce and is fundamentally about flexibility – for both employer and employee. That flexibility offers employees a higher wage for less secure employment. It’s a deal both parties should be able to provide without the state’s interference.
The aptly named ‘Same Job, Same Pay’ is Labor’s answer to the mining industry’s circumvention of enterprise agreements through labour hire. While this might pass the pub test at face value, it should be noted that the industry pays all players extremely well – while practically underwriting Australia’s economy.
The Australian Bureau of Statistics estimates less than 10 per cent of the industry is drawn from labour hire, which suggests the motivation is less a moral cause and more political payback. Labour hire is an enemy of the union movement because it gives employers options when it comes to enterprise bargaining, undermines the effectiveness of industrial action, and weakens union membership.
The punitive aspects of the bill come in the form of measures for alleged wage thieves. The bill states that employers ‘can face criminal prosecution’ with a ‘possible penalty of 10 years imprisonment’. While the bill recognises that mistakes happen, the decision between mistake and intention seems to be in the hands of bureaucrats and an encyclopedia of legal jargon.
However, the most naked aspect is Labor’s plan to bolster union presence in the workplace. In effect, the bill deputises unions to scour the nation’s employers for wage theft. In a fairy-tale fitting of the brother’s grim, union delegates could have their employers pay for their training while they undertake investigations within their workplace. Employers will be bound by new laws to tell their union delegates the truth – and nothing but the truth – with the onus on the employer to establish that their conduct is not unreasonable.
The bill typifies Labor’s worst instincts on industrial relations and unmasks the union movement’s power within Canberra. The ideology behind it should scare Australian employers. Central to the bill is that employers are inherently dishonest, while workers are too stupid or weak to stand up to them. It’s an archaic ideology that ultimately shrinks productivity and drives division in the workplace.
Employers watching this government must ask themselves – what does this mean for me? And how far can I afford to let this go?
If the answer to either is unclear – join an industry association and take the fight public.
