IR reform crashes onto agenda

The Productivity Commission has flagged reform of the minimum wage, penalty rates and enterprise agreements in its workplace relations review issues paper, which was accidentally released early today.

The paper, which was due for release tomorrow morning, is the first step in a massive review of the nation’s employment relations system that Treasurer Joe Hockey requested in December.

The commission said submissions would be due by March this year, with a final report expected in November.

In its paper on safety nets, the commission asked what the appropriate role should be of the minimum wage, for evidence regarding the effects on different groups and the suggestions for the process used to set the rate, among a variety of other questions.

“To what extent should an EITC (earned income tax credit) or some other in-work payment serve as a complement or substitute for minimum wages?,” the report asked.

“How should any such payments be funded, and what would be the economic and distributional outcomes of alternative funding mechanisms?”

The minimum wage in Australia is currently just below $17 per hour, and around 7 per cent of the nation’s work force is paid at that rate, according to the commission.

The commission also sought comment on penalty rates.

“Were penalty rates deregulated, would wages fall to those applying at other times, or would employers still have to pay a premium to attract labour on weekends and holidays,?” it asked.

Labor has jumped on the release, with Labor employment and workplace relations spokesman Brendan O’Connor tweeting the report today.

“Is this the blue print for Tony Abbott’s revival of WorkChoices?,” Mr O’Connor said.

The return of focus to industrial relations will be encouraging to employer groups, who have pressed the prime minister for reform since he took office.