Fair Work Act review details unveiled

The federal government has asked a former federal court judge, an academic and a Reserve Bank board member to review the Fair Work Act.

Terms of reference for the review were released by Workplace Relations Minister Bill Shorten in Melbourne today.

The review will be conducted by RBA board member John Edwards, Justice Michael Moore and legal and workplace relations academic Ron McCallum.

"They bring diverse experience and skills in working on workplace relations and economic matters in Australia," Mr Shorten said.

“The Government believes the Fair Work Act is working well, but there is always room for improvement and I am very pleased these three eminent Australians have agreed to lead the review.

"They are all highly respected and will bring the level of independence and objectivity required for a review of this nature.

“We will of course continue to consult with employer organisations, trade unions, employees, workplace relations experts and peak bodies throughout the review period and beyond.”

Australian Mines and Metals Association chief executive Steve Knott said with a Coalition that appeared to have no policy on industrial relations, he believed Mr Shorten's extensive understanding of workplaces and industry could be the resource sector's best chance to address problems in Fair Work laws.

“One of the resource industry's more immediate concerns is how the Fair Work laws continue to allow the current monopoly unions have in making agreements for new projects," Mr Knott said.

"This has resulted in excessive cost blow-outs and delays on major projects, with employers experiencing wage increases of 40 per cent in the last 12 months.

“With laundry hands and barge welders receiving annual salaries in excess of $300,000, Minister Shorten is well placed to understand that such high wages are unsustainable and measures must be taken to address these problems and ensure the viability of significant new projects.

“AMMA and the industry has confidence in Minister Shorten‟s ability to oversee a fair and objective review of the IR legislation and we look forward to a consultative process as industry and government work together for a more prosperous economic future.”

Chamber of Commerce and Industry acting chief executive John Nicolaou said the review was long overdue, and the CCI was pleased the it would be conducted independently with the intent to develop a balanced industrial relations framework.

"The longer the current system remains, the more apparent it becomes that it is not striking a fair balance between the rights and interests of employers and employees," Mr Nicolaou said.

"It is important that this review leads to positive change, and there must be political will on the part of the government to do so."

Australian Industry Group chief executive Heather Ridout said employers were looking for real outcomes from the review which would support competitiveness over the next few years.

"The test of the review will be the extent to which its outcomes support increased productivity and flexibility, reduce red tape and improve competitiveness," she said.

"Importantly, the Review should focus on the precarious nature of global economic circumstances, the immense structural pressures facing non-mining trade-exposed businesses (the big employing sectors) and the barriers in the Act which are inhibiting businesses from making the necessary changes to remain
competitive."

She said while the review presented opportunities, it also presented significant risks to industry, particularly given some of the proposals being pursued by unions.

Master Builders Australia chief executive Wilhelm Harnisch said the review was a valuable opportunity to restore much-needed balance in Australian workplace laws, with the current Act going too far in favouring unions at the expense of competitiveness and productivity.

"An important priority for the building and construction industry will be coverage of independent contractors who are currently subject to regulation via workplace agreements," he said.

"Contrary to union claims, independent contractors should not be regarded as employees.

"The Review Panel in preparing its report must also give substantial weight to ensuring the Australian industrial relations system makes a positive contribution to sustained improvements in labour productivity and through this our economic competitiveness.

There are a multitude of other changes that are required to the Fair Work Act."

Master Builders has identified over 40 changes that will be presented to the Review Panel.