ALP IR Policy Confirms Business Concern

The release today of the ALP’s workplace relations policy document confirms business concerns about Labor’s plans to recentralise Australia’s workplace relations framework.

The policies announced today are broadly consistent with ALP’s National Conference Platform. An analysis of the platform was undertaken by Access Ecnomics and released by the Business Council of Australia in July.

Chairman of the BCA’s Employment and Participation Task Force, Mr Michael Chaney, said despite assurances by Labor that their policies would be moderate and light touch, the aggregate impact of the policies announced would be significant.

The Access Economics report clearly outlines the potential adverse implications of these policies for productivity and job creation in Australia. The report notes that reducing the level of flexibility that the current workplace relations system affords for local workplaces would:

  • Undermine productivity growth.
  • Make it more difficult to sustain job creation and low unemployment.
  • Diminish the ability of business to provide the flexibility necessary to support the workforce participation of older workers, women and young people.

“Labor’s proposals are inconsistent with deregulation in most other areas of the Australian economy,” Mr Chaney said.

“The key business concern is Australia’s capacity to remain competitive and to create the innovative, high-skill jobs needed to support growth, productivity and higher standards of living.”

The Access Economics report concludes that the re-empowerment of the AIRC and proposed changes to the Workplace Relations Act threaten to reverse important cultural and attitudinal changes that have enabled employees and local workplaces to be more accountable for performance, productivity and rewards.

Mr Chaney said that while key aspects of Labor’s proposals may already be operating at the state level, a significant share of agreements continue to be struck under the federal system – including in NSW and Queensland.

“Moving the federal system closer to that operating in the states will truncate the flexibility available to employees and employers – in the same way that abolishing AWAs will limit opportunities for employees and employers,” he said.

“The use of AWAs and federal agreements can be highly significant in some sectors. For example, nearly all employees in the resources sector are covered by AWAs. Abolishing these options will have a substantial impact on sectors that are at the forefront of Australia’s global competitiveness.

“Workplace reform has underpinned Australia’s economic success over the past decade,” he said.

Mr Chaney said he is pleased that the policy detail appears to respond to concerns from business about the ways in which greater job security might be achieved for casual workers.

“The proposal for an inquiry to examine growth in contingent and insecure employment and its effects is constructive.

“However, we continue to be very concerned about the proposed levy on businesses with more than 20 workers to cover employee entitlements in the case of insolvency. Such a policy imposes unnecessary cost on businesses, the vast majority of which are adequately provisioning for employee entitlements,” Mr Chaney said.

Assessment of the Australian Labor Party Workplace Relations Policy Platform