From Students to Airlines – the Workplace Relations Agenda 2012

Address to the Australian Industry Group PIR Conference, Canberra

From the aspirations of a student wanting to earn money after school through to the ongoing viability of Australia's icon, Qantas – the workplace relations agenda has been a busy one in 2011 and promises to be even busier in 2012.

From dealing with the aspirations of a student to the national carrier we are reminded that the workplace relations regime is far reaching.

From dealing with a student to an airline, we are reminded that the system of workplace relations needs to be flexible and responsive.

To the student who wants to earn a few dollars after school – his case for flexibility is just as important as the Qantas issues are to the travelling public let alone the workers and management.

From the student to the airline and everything in between will be topics of dispute and discussion in 2012.

2012 will also witness the retirement of the President of Fair Work Australia, His Honour Geoffrey Giudice – after 14 years of distinguished service on both the Australian Industrial Relations Commission and Fair Work Australia.

His leadership and oversight in impossible circumstances sometimes (like the so-called modern awards timetable) – not of his making I hasten to add – cemented his reputation as a very capable judicial officer with a demeanour to match.

As he retires in February next year, he should look back with a sense of pride and achievement knowing he has provided outstanding service.

He will retire with the best wishes of the Coalition and I trust all sides of politics. If he does it will be a deserving tribute and an indication to the Government of the type of replacement they should be seeking.

So the Coalition calls on the Government to finally live up to its promise not to appoint an endless tribe of trade union officials to Fair Work Australia.

If its appointments to Fair Work Australia to date are an indication we will be disappointed. But who knows, the ALP may find "balance" under the Christmas tree.

Let's hope they do – not only in their appointment of a new President of Fair Work Australia but also in their review of the Fair Work Act scheduled to commence in 2012.

2012, unfortunately I suspect, is also shaping up to be the year where the Green Labor Alliance partners will seek to outdo each other in pandering to the trade union leadership in pursuit of trade union leadership for forthcoming elections. Make no mistake, they are engaged in one-upmanship…

…and we see that in the approach to the Australian Building and Construction Commission which will be regrettably abolished early in the new year…

…and if the last few weeks are an indication, we will seen the Green Labor Alliance guillotine the changes through the Parliament without a single word of debate and then cut our sitting times.

The Australian Building and Construction Commission

The Australian Building and Construction Commission was established by the Howard Government following the Cole Royal Commission.

It goes without saying that the ABCC has made an outstanding contribution to Australia's national productivity and has substantially reduced lawlessness and thuggery in that sector. For those of you that would like to see what kind of practical solutions an Abbott Coalition Government would deliver, you need not look further than the ABCC.

As Workplace Relations Minister, Mr Abbott was faced with a huge problem – he could sit by and allow these practices of the past, including thuggery and intimidation to go on, or he could take action. He chose the latter. He commissioned the Cole Royal Commission into the Building and Construction sector which exposed just how damaging the behaviour of some union bosses and some employers were on the construction sector and to our national economy.

Decisive action worked in the past and it will work again. The Coalition will restore the Australian Building and Construction Commission's with its former powers.

We believe workers have the inalienable right to go to work without the fear of a union thug rocking up using the worst kinds of tactics to get the result they want.

The Qantas Dispute and the Unions

Let me now turn to the Qantas dispute. Everyone has their own view – and if nothing else it put the Fair Work Act and its operation up in lights.

This dispute has brought to the surface some issues with the Fair Work Act. Apart from some issues with the Act, the Government was completely inept in dealing with the situation.

We had Minister Evans – or 'Bernie' as he is known to his colleagues (courtesy of TWU Secretary Tony Sheldon who said quite uncharitably that the Minister reminded him of the corpse from the movie Weekend at Bernie's) choosing to allow Qantas to ground the fleet and cause significant disruption for the travelling public.

But let's look at the lead up to that fateful Saturday. For the week beforehand, you had a number of calls for the Government to intervene. It seems everyone but the Government could see the writing on the wall.

We had a dispute that was causing great uncertainty for a major player in our economy and the provider of a vital service. The Union Leadership used very strong rhetoric with threats of 'slow-baking' Qantas and calling for consumer boycotts as well as trickiness about calling disputes. To be fair, I have consistently said that Qantas deciding to award executive pay rises in the middle of negotiations was also singularly unhelpful. 

The Coalition, State Governments, the tourism sector and many others could see that the dispute was coming to a flashpoint but the Government supposedly didn’t detect a thing.

Given the number of union bosses and industrial lawyers in the Labor Party, I find it difficult to understand that they had no idea what might unfold. They seem to forget that they wrote the legislation.

If I were the Minister, or indeed if Bill Shorten was for that matter, the Government would have used section 431 to immediately terminate the dispute before 5 pm on that Saturday afternoon and the fleet would have remained in the air.

The argument that the Government didn't on the basis of section 431 being 'untested' is laughable but for the incompetence it displays. The section they did use had not been tested either. Nor have many other sections. That’s what you get with a new Act – an Act I remind you that was drafted by Ms Gillard.

As for the dispute as a whole, I agree with the head of the Future Fund, David Murray who said "unless companies tackle entrenched union privilege, Australia risks the same fate as Europe."

At the heart of this dispute were some questionable demands under the umbrella of 'job security' such as the Union Leadership wanting new hangars built and wanting to limit the use of contractors. I await the outcome of the arbitration.

Job Security

But let's not forget the best job security for employees is for their employer to be in a strong position. That means that the employer should be able to make management decisions to ensure the best outcome for their enterprise.

We don't want the revival of the Hammersley dispute over three flavours of ice cream in the canteen. Or for that matter the concept of 'green bargaining' that has been put forward by the Australian Greens and the Australian Council of Trade Unions.

On the issue of job security it seems that the new transmission of business rules have prejudiced job security.

By junking the well established High Court definitions in Gribbles and PP Consultants the Fair Work Act has perversely provided an incentive to dismiss existing workers when a business is transmitted. Yet again Labor and the trade union leadership are oddly silent.


Previously, we have been told the Fair Work Act is working just fine. If you ask the Minister, he'll tell you that there aren't any problems at all.

This timid approach, from - one assumes fear of offending the Prime Minister, that the Fair Work Act is perfect and Ms Gillard got it absolutely right first up is as weak as it is lazy and is as damaging as it is wrong.

Instead of leaving the interpretation to two vested interests to argue out, the Government should be prepared to provide some 'directional submissions' as to the intent of the Act and in particular to protect the public interest.

Did the Government intend for the Fair Work Act to allow union leaders to take pre-emptive strike action as in the JJ Richards case? I would suggest they didn't – you just have to look at the Treasurer's comments on ABC Radio that “The Fair Work Act has the same provisions in it when it comes to protected action as the previous Workplace Relations Act. So there’s been no change there…”[1].

I asked the Department about this at Senate Estimates and they were nice enough to provide me with an answer that shows there are considerable differences but then went on to say the "Treasurer’s observations were reasonable and appropriate"[2]. I trust if I have the privilege of being the Minister, the Department won't be forced into such acrobatic sophistry to defend me.

So on this, it's not clear what the Government's intention actually was. Was it – as the Treasurer said, for there to be no change or was this the intended outcome of this provision?

The Minister and the Prime Minister have both been deadly silent so we don't actually know…

…and in relation to the ADJ Contracting case, the Government have stayed clear. We don't know where the Government stands.

The Minister's response has been to say that the independent umpire is considering the issues. What he fails to comprehend or acknowledge is that Fair Work Australia and the Courts umpire on the basis of the rule book – the rule book that Labor wrote.

The silence of which I have been critical in so many areas, has been broken! But as the old saying goes – "be careful what you wish for". The Government has finally sought to intervene in a case - the Barclay v. Bendigo Tafe case in the High Court. But they've intervened in support of the Australian Education Union and Mr Barclay!

What the Government is confirming is it WAS the intention of the Fair Work Act to create two classes of workers – union bosses and non-union bosses – and union bosses are treated better than anyone else.

We have to keep in mind that adverse action was never part of Labor’s ‘Forward with Fairness’ document. It was a surprise insert into the legislation.

Fair Work Australia has reported that the number of adverse action claims under the Fair Work Act is on the rise.

The Federal Court in Barclay has interpreted Labor’s Fair Work Act as, in effect, absolving an employee from any responsibility and accountability as an employee because their unacceptable conduct was undertaken as a union boss.

As one observer has quite rightly warned that decision "throws into doubt legitimate company action against staff who happen to be associated with union activities”[3].

My very real concern is that the adverse action provisions of the Fair Work Act could make union bosses untouchable – something that the Government appears to welcome in its submission to the High Court.

Just look at Jones v Queensland Tertiary Admissions Centre Ltd[4]. Quite rightly, QTAC investigated complaints of workplace harassment and bullying and they came to the view that the appellant – a union official – was in the wrong.

The primary concern is that QTAC even investigating whether the union official had been harassing and bullying other employees constituted adverse action. An employer can't harass and bully employees to further the interests of the enterprise.

Nor should they be allowed to engage in such behaviour. So why should union bosses?

There should not be two different classes of workers, with one being a protected species. Employers as a minimum should be able to check out the allegations.

But despite all of this, I was told by the Minister that "available evidence indicates that the Fair Work Act is working as intended."[5]

Individual Flexibility Agreements

The Minister for Workplace Relations himself has finally flagged that the Individual Flexibility Agreements aren’t working. We have been saying just that for some time.

We have been listening, to employees and employers tell us how IFA's might work better.

For example the 28-day notice period is a disincentive to using them and I am glad that the Minister has conceded that the low take up was due to concerns such as this.[6]

Productivity and Jobs

Julia Gillard promised us in 2007 that "Labor's plan [for industrial relations] is all about supporting and making sure that our economy continues to grow. Our industrial relations plan is about driving productivity at work…"[7]

Indeed, she told us that Labor would "create an industrial relations system that will increase productivity by getting the balance right between fairness and flexibility"[8].

However, the Government's own measure[9], shows a decline in workplace productivity by 1%. This is something that the Department at the last Senate Estimates[10] confirmed - namely that "the annual report shows there has been a decline in productivity in the course of the year."

Despite Labor's rhetoric about productivity, The Fair Work Act has failed to provide any real focus on productivity. Labor was perfectly happy with the Total Marine Services 30% wage increase without a productivity offset.

This is yet another example of Labor making the spectacular announcement with a spectacular failure in the follow up.

There is a better way. The Coalition would put a genuine emphasis on productivity.

To that end a Coalition Government would have asked the Productivity to undertake the promised review commencing on the first of January 2012. We are committed to ensuring that we have a strong and productive economy and we recognise workplace relations is a key to achieving that goal. Without a strong and productive economy we all suffer especially those on lower wages.

We know that the more productive we are as a nation, the more jobs there are. We know the more productive we are as a nation, the greater the scope for sustainable wage increases. We know the more productive we are as a nation, the greater our capacity to fund essential services. 

A productive economy needs a "productivity" workplace relations mindset. That way we all win.


As you are no doubt aware, we are coming into 'review season'. From January 1 we will not only have the review of the Fair Work Act. Next year we will  also have the review of the Modern Awards.

There are certainly considerable concerns with both and I would encourage everyone to make submissions where there are concerns.

Let me go into so-called 'modern awards' which are a prescriptive throw back with a rigid “one size fits all” approach.

For example, Dental workers are thrown in with art therapists. Only the dullest of us would not immediately recognise the overwhelming overlap of common interest between the dentist and art therapist.

I’m sure we’ve all at least once in our life stumbled out of bed in the early morning hoping that the art therapist is open. And for all those art therapists that run a dental clinic as a side line the new award will be of great assistance and stream line their operation.

But more seriously – do health insurance companies provide a greater rebate for a tooth drilled on a Saturday or a Monday? But the staff will now get paid significantly more for working on a Saturday – even if working Saturday morning suits their family and work life balance. Which means the dentist actually gets paid significantly less because he gets what is left over. So rather than expanding clinic hours as requested by the Government dentists will be closing because in the new equation the only person worse off is the dentist – the small business person.

Now, they tell me dentists get paid relatively well and the sympathy stocks might not be that high. Unless you are in the market for treatment on a Saturday.

Let’s turn to the so-called modern building award. You will be pleased to learn that Clause 15.3(b) says “No apprentice under the age of 18 years will be required to work overtime…unless they so desire.”

And if the apprentice is over 18? Then only “to enable requirements of the training plan to be met” – 15.3(a)

This is undoubtedly designed to acclimatise them to the rigours and realities of the sector!

But to really highlight the visionary nature of these awards and their desire to drive innovation with the use of the latest technology there is a specific requirement that pneumatic rubber tyred wheelbarrows be provided for workers moving bricks and materials if there is an absence of adequate natural ventilation. See Cl 21.1 (c)(iv).

And the health and well being of our building workers has not been forgotten either. So bricklayers working in a tuberculosis hospital are entitled at employer expense to have an x-ray every 6 months during work hours and be paid for it.

The modern award does not require that the x-ray be of the chest. So possibly if you did your back in at home you could go for an x-ray at the boss’ expense?

More seriously on reading this part of the Award I thought I would research and find out how many TB hospitals still exist.

I confess I thought I knew the answer. And the Parliamentary Library believes that the last dedicated TB Ward was closed in 1981. So here we are padding out Awards with this specificity that has only been irrelevant for three decades.

Albiet they may have been showing foresight given that last year we saw the highest notification of TB cases in the past two decades which of course is related to another policy failure. But I digress…

…and if you use a pneumatic tool as a stonemason for even five minutes on a particular day you are entitled to be paid the whole days wages with a 17.6% loading.

Modern Awards have also left many workers worse off – just ask the unions.

Having promised no worker will be worse off – tens of thousands are worse off. Having promised employers won't be worse off – tens of thousands are worse off. But why are we surprised?

Before concluding let me turn to calls from some in the commentariat for a full platform of reform from the Coalition immediately, even before some matters are judicially determined, or before the review is undertaken.

If we did, the criticism no doubt would be that we are being precipitous and not properly informing ourselves.

But having promised no change to the Fair Work Act in this term of the Parliament to allow the Act to bed down, it would be disingenuous to put forward an agenda of change before the half way mark of this term is reached.

It stands to reason that as the term progresses, as the judicial determinations come in and the review is undertaken we will progress our thinking on practical solutions. I for one am hopeful that the students issue will be resolved within the existing framework.


Have a great Christmas break. Because, 2012 is shaping up to be another year – a year in which we will need to find practical solutions to the practical problems which will be further clarified courtesy of judicial determinations and the review.

The Coalition looks forward to working with the Australian Industry Group and all other stakeholders in 2012 to shape those practical solutions to deliver workplace relations justice for students and airlines alike – and everyone in between.

[1] ABC Radio, 2 June 2010

[2] Answer EW0052_1, Senate Education, Employment and Workplace Relations Legislation Committee

[3] Employers fear union ruling, Mark Sculley, Australian Financial Review, 21 February 2011

[4] Jones v Queensland Tertiary Admissions Centre Ltd [2009] FCA 1382

[5] Answer to Question on Notice 1241

[6] Senator Evans' Address to Australian Labour and Employment Relations Association National Conference, 7 October 2011

[7] Transcript of Doorstop Interview, 20 November 2011

[8] The Future of Australian Workplace Relations, Speech to the Australian Retail Association, 2007

[9] Department of Education, Employment and Workplace Relations Annual Report 2010-11

[10] Senate Estimates Hansard, 19 October 2011

About Eric

Eric Abetz has been a Liberal Senator for Tasmania since 1994 and has served in a range of Leadership, Ministerial and Shadow Ministerial roles.

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