Industrial Relations Policy – The Coalition vs The ALP

Industrial relations policy has been a key point of difference between the Coalition and ALP in the lead up to the 24 November election.

In this first edition of the Higher Education Legal Update, we provide an overview of the Government and ALP workplace relations policies – focussing on the aspects of the policies which will be important to the university sector.

On 7 November 2007, the Coalition made an unexpected announcement about further changes it would make to Work Choices if re-elected. These changes are 'fine tuning' amendments only.

Relevantly, the Coalition's proposed amendments include:\

• Prohibited Content: under Work Choices 'prohibited content' (eg, leave to attend union training) cannot be included in a Workplace Agreement. This has led to unions and employers doing 'side deals' – putting the prohibited content in common law agreements and deeds. The Coalition is proposing to amend Work Choices to provide that side deals containing prohibited content will not be enforceable. There will also be a prohibition on a union applying illegitimate pressure to a university to enter into a side deal; and
• Annual Leave: the Coalition is proposing to amend the annual leave provisions of Work Choices to provide that an employee may take double their annual leave, at half pay – provided the university agrees.

It is not known whether the Coalition would introduce further amendments if elected. However, if it did, the new Fairness Test is likely to be a prime candidate for review.

ALP policy envisages two main phases:

• a transitional phase, starting shortly after the election, with a Transitional Bill being introduced into Parliament; and
• key changes following consultation. Some of the key changes will start on 1 January 2010 – but there may be other changes which start earlier.

The most significant part of the Transitional Bill is the abolition of AWAs (assuming, of course, that the Senate co-operates). However, the ALP has taken some steps to counterbalance the abolition of AWAs, including:

• existing AWAs may run their full nominal term – meaning the last AWAs will expire around 2012;
• an 'individual transitional employment agreement’ will be available for employers using AWAs for two years until 1 January 2010 – this is an agreement between the employer and employee that must pass a no disadvantage test against the employer's collective agreement or, if none, the relevant award; and
• collective agreements and awards will include a flexibility clause allowing an employer and individual employee to make a 'flexibility arrangement’. Although it is not clear, it appears that such an arrangement could be about hours of work, rates of pay or similar conditions.

In 2008 and possibly 2009, an ALP Government would consult on its main industrial legislation – including releasing a draft exposure bill. Following this, it seems the ALP intends to pass the main legislation in late 2008, at the earliest. The key date for change is 1 January 2010 - on that date, Fair Work Australia and the National Employment Standards will commence. It is not clear when the new requirements in relation to Workplace Agreements will commence – but it may be before 1 January 2010.

Most importantly:

• agreements will be subject to a form of ‘no disadvantage test’ against the relevant award and minimum legislative standards (ie, the National Employment Standards);
• agreements will be approved by Fair Work Australia. They will be approved within seven days and can be done ‘on the papers’ – i.e. without a formal hearing;
• a collective agreement can have a nominal term of up to four years (as opposed to five years under Work Choices); and
• all collective agreements will be required to contain a flexibility clause allowing an employer and individual employee to make a ‘flexibility arrangement’.

An ALP Government would enshrine workplace rights relating to:

• the right to representation, information and consultation in the workplace;
• the protection against unfair treatment; and
• access to an effective procedure to resolve grievances and disputes.

The ALP also proposes a range of changes in relation to unfair dismissals:

• an employee cannot bring an unfair dismissal claim in the first six months if they are employed by an employer employing 15 or more employees, or 12 months otherwise;
• removing the prohibition on unfair dismissal claims relating to termination for operational reasons;
• unfair dismissal claims will be heard by Fair Work Australia – in a conference, and if the matter is not resolved Fair Work Australia will make a decision. Lawyers will probably not be permitted to be involved in the process;
• a 'fair dismissal code' will be developed – if an employer complies with the code, the dismissal will be considered fair; and
• the remedy for unfair dismissal will be reinstatement. If reinstatement is not in the interest of the parties, compensation would be ordered.

From 1 January 2010 there would be ten National Employment Standards:

1. A 38 hour week plus reasonable additional hours.
2. Up to 12 months unpaid parental leave and the right to request an additional 12 months unpaid parental leave (which an employer cannot unreasonably refuse).
3. Flexible work for parents.
4. Annual leave of four weeks for full time employees and five weeks for shift workers.
5. Personal, carer’s and compassionate leave.
6. Community service leave.
7. Guaranteed public holidays.
8. Employers must provide all new employees with a ‘Fair Work Information Statement’ – with particular information about workplace rights.
9. Notice of termination according to age and length of service and the introduction of a universal standard of severance pay.
10. The development of nationally consistent long service leave entitlements.

An ALP Government would establish a body known as ‘Fair Work Australia’, which it describes as a ‘one-stop shop’. Fair Work Australia would replace, among others, the Australian Industrial Relations Commission, the Workplace Authority and the Workplace Ombudsman.

Universities need to comply with the HEWRRs in order to be eligible to receive Commonwealth Grant Scheme funds. Significantly, the HEWRRs require Universities to offer AWAs to employees.

What will happen to the HEWRRs if the ALP wins the election?

The answer to this question is unclear as the ALP has not made any specific comment about HEWRRs. However, given the ALP's opposition to HEWRRs when introduced by the Coalition, and the ALP's policy of abolishing AWAs, it is possible that the ALP would remove industrial relations conditions from HEWRRs or alternatively may introduce industrial relations conditions which reflect its own industrial relations policy (as the Coalition has done).

As we have already seen, there has been significant debate about workplace relations during the election campaign – we can expect this to continue in the final days before the election, although we are unlikely to see substantive policy changes.

For full coverage of both the Coalition and ALP Policy, see our HR&IR Updates on the Election and Workplace Relations dated 15 October 2007 and 8 November 2007.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.