Greg Combet: Real Economic Challenges and the WorkChoices Legislation

In a Speech to the Progressive Essays Dinner at the National Press Club last night (2 Nov 2005), ACTU Secretary Greg Combet outlined his critique of the Government's new IR legislation in the context of the real economic challenges facing Australia.


Summary
WorkChoices is very nasty legislation.

It is the wrong economic strategy for Australia. It encourages exploitation, not enterprise. It will undermine the security of working families.

The Government has failed to make the case that the laws will create jobs, lift productivity or improve living standards.

It is ideology we are dealing with here - the articles of Liberal Party faith.

We face these laws because the Government has won control of the Senate and has the power to do what it wants.

Let's not forget that Australia is in its fourteenth consecutive year of economic growth. The industrial relations system has not held the economy back.

Industrial disputes are at historic lows. There has been sustained productivity and employment growth. The profit share of the economy is at record highs.

Even the pet-shop parrots know that.

Certainly we must continue to make economic reforms that will generate future prosperity.

But reform that makes it harder for working families to share the benefits of the economic good times, and leave them with little protection in the hard times, is not the way forward.

There are far more important economic priorities - education and skills, Australia's flagging trade performance, investment in research and development, leadership in social and economic infrastructure investment, the need to reduce dependence on domestic debt and consumption as drivers of growth, and the importance of building savings.

In the labour market the Government, notwithstanding the surpluses available to it, has still not addressed the reform the ACTU has advocated for some years - the disincentives generated by the high effective marginal tax rates imposed on many social security recipients and low income earners.

All of these reforms will drive improvements in future productivity and living standards - they are the real economic priorities.

Instead the Government has taken the lazy way out. It has embraced a plan to deliver extraordinary workplace power to business and diminish the rights of every Australian employee.

The essential aim of the new workplace laws is to allow businesses to unilaterally determine the pay and employment conditions of employees - free of interference from unions, collective bargaining, awards, industrial tribunals and workers themselves.

Some of the key changes in the legislation are:

  • Unfair dismissal protection will go for millions of people. Instead of addressing problems with the current system, the principle of fair treatment is to be trashed.

     

  • The award system will no longer be the safety net underpinning the labour market. The aim is to eventually get rid of awards and to have only five minimum conditions to protect people.

     

  • Penalty rates for weekend and shift work, overtime, allowances, career structures, public holidays, redundancy pay, meal breaks and a host of other award conditions will be up for grabs.
  • It's not a matter of trading these rights away - they can be taken away without compensation. They will not be protected by law. The take-home pay of many workers can and will be cut - particularly those most vulnerable.

    The new laws will also mount a full-frontal assault on unions and collective bargaining.

    In fact WorkChoices reads like a 'how-to' guide to breach the international conventions on the right for employees to collectively bargain.

    Unless an employer voluntarily chooses to collectively bargain, employees and unions will have very limited capacity to achieve a collective agreement.

    One of my favourites in the legislation is the 'employer green-field' agreement.

    This is where a company negotiates an agreement with itself before starting-up - with no input from employees or unions whatsoever - the ultimate in flexibility.

    For good measure many legitimate union activities will be made illegal.

    Union officials, delegates and employees will be fined $33,000 simply for asking an employer to include in an enterprise agreement a provision to remedy an unfair dismissal or have union involvement in dispute resolution.

    In the building and construction industry workers face six months gaol if they refuse to attend a secret interrogation, if they refuse to answer questions even though it may incriminate them, or if they refuse to hand over documents.

    And this is not because of suspected terrorist activity. These criminal penalties can arise because of legitimate union activity - such as the defence of job security.

    By the time these laws are fully implemented there will be only five minimum conditions of employment underpinning the labour market.

    To get more than the five minimum standards the Government wants people to negotiate an individual contract - an AWA - with their employer.

    We all know what that means. It means what John Howard said it means - in a rare moment of honesty - if you don't like it you can get on your bike.