09/06/2011 - 00:00

Common ground key to IR harmony

09/06/2011 - 00:00


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With many in business believing the Fair Work Act has given unions too much bargaining power, the CCI has come up with an industrial relations plan of its own.

FOR more than a century, the Chamber of Commerce and Industry WA has advocated for employers in Western Australia on industrial relations. The need for an effective industrial relations system remains as relevant to our 21st century economy as it did back in the days when Australia rode on the sheep’s back.

To the frustration of the WA business community, we still have a way to go to achieve the IR sytem that modern enterprises need.

The level of concern in the WA business community is reflected in the number of calls we are receiving from members to our industrial relations hotline, the Employee Relations Advice Centre. Calls to ERAC increased by more than 35 per cent during the past year to 32,400. That’s about 90 calls every day of the year.

Rather than providing a recipe for fairness as promised by the Labor Party in the lead up to the 2007 election, the current Fair Work legislation has delivered unions unprecedented power, far exceeding their size and relevance in our modern, competitive and increasingly globalised economy.

That is why CCI has designed a proposal for a new Australian industrial relations system. It aims to move employers and employees away from the class warfare rhetoric and adversarial and conflict IR models of the past.

CCI calls on federal, state and territory political leaders to put aside their ideological differences and sloganeering and respond seriously to this carefully thought-out blueprint for an industrial relations system that supports a smart, innovative and hardworking Australia.

CCI’s latest policy paper, ‘Industrial Relations for Modern Enterprises’, sets out a vision for a simple, effective, relevant and sustainable industrial relations system for a modern, competitive global economy.

What CCI is calling for is a staged, evolutionary process that builds on aspects of the current Fair Work laws and introduces a suite of new approaches and practices.

There is enough evidence already to show that the Fair Work Act is not working.

It seems unions have already made the waterfront their first battleline, with rolling strikes and industrial action at ports across the nation.

There are several recent rulings by the independent umpire, Fair Work Australia, that are cause for concern.

Most recently, FWA dismissed an appeal by employers against its earlier decision to allow workers to take strike action before bargaining for an agreement has even commenced.

FWA has ruled in the case involving ADJ Contracting, an eastern states business, that it’s possible for employers to be forced to promote union membership in future enterprise agreements. The ruling also paves the way for union officials to enter a worksite un-announced and without a permit.

It’s another example of how the current system gives too much power to unions, and is not responsive to the needs of modern businesses.

CCI is the first business organisation in Australia, since the advent of Fair Work laws, to put forward a serious model for reform of industrial relations.

CCI’s policy promotes three principals as the foundation for a better system.

• A movement away from the adversarial and conflict model to enterprise-focused engagement between employers and employees based on free enterprise principles, economic sustainability and mutual responsibility.

• A simple and practical industrial relations system that focuses on the enterprise and reduces regulation and interference by third parties in the management of a business.

• Building on the Fair Work system; it does not propose a radical change but rather an evolutionary development towards enterprise based engagement and decision making between employers and their employees.

Prime Minister Julia Gillard has spoken of her government’s commitment to addressing flagging productivity. She has said it is a key area for reform.

Addressing the problems with the industrial relations system would be a good start to that reform.


• Further simplification of the awards structure. The 122 modern awards should be reduced to 20 industry awards, and award conditions simplified.

• The use of all agreement making options, such as collective, individual, greenfields and other multi-employer types. The one-size-fits-all approach doesn’t work. All agreements would be subject to a better-off-overall-test to provide employee protections and guard against coercion.

• Less process and a greater focus on outcomes in bargaining.

• An emphasis on dispute resolution in the workplace, with no compulsory arbitration.

• Union entry to a workplace would be subject to the union being covered by an agreement related to the site or the enterprise.

• The introduction of a simpler unfair dismissal process.

Industrial relations is one of the most important regulatory issues faced by all employers.

CCI takes seriously the need for Australia to remain competitive. We’ve put forward a plan to encourage enterprises and their employees to lift productivity, operate flexibly and innovate in order to create wealth and jobs.

If politicians take seriously these goals, then they will be prepared to join business to promote the need for genuine industrial relations reform.

If union leaders take seriously the concerns of the businessmen and businesswomen who employ their members and pay their wages, then they won’t dismiss CCI’s arguments as a ‘return to WorkChoices’ but will respond in a considered way to our proposals for reform and work with us to find common ground.

If we can get this right, we can be confident that we will have made a constructive contribution to setting up Australia to succeed.

• James Pearson is chief executive of the Chamber of Commerce and Industry WA.


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