Business Releases Review of ALP Workplace Relations Policies

Australia’s leading companies today released a report on the potential outcomes and impacts on Australia’s economy of the ALP’s workplace relations platform.

 The 80-page report by Access Economics – commissioned by the BCA – found there were real threats to Australia’s continuing economic and job growth if workplace relations were re-regulated in line with Labor’s platform.

The report advocates that other measures such as tax and welfare policies should be examined to address issues of perceived fairness and equity because the long-term cost to the economy of re-regulating the workplace would exceed any benefits.

Releasing the report, the Chairman of the BCA’s Employment and Participation Taskforce, Mr Michael Chaney, said its objective was to encourage greater discussion and understanding of what major changes to the current system of workplace relations might entail.

“The BCA does not see this as just a political debate, rather a critical policy debate that to date hasn’t had the airing it deserves,” Mr Chaney said.

“As the Access paper shows, re-centralising and re-regulating the workplace will result in significant flow-on effects for the wider economy, job growth, living standards and individual opportunity.

“The research reveals the major risk from implementing such a platform will be a weakening in the productivity growth achieved by Australia in the last 10 years.”

Mr Chaney said the present system had come about as the result of reforms by successive Labor and Coalition governments, aimed at less intervention and greater scope for individual parties to agree wages and conditions for the local workplace.

As the Access paper demonstrates through a combination of detailed analysis and research, this has been a major part of Australia’s recent economic success story.

“Workplace reform has underpinned strong job and wages growth, low inflation and productivity improvements for a number of years,” Mr Chaney said.

“Over the past two decades, the system has allowed employees and local workplaces to take on more responsibility for performance, productivity and rewards. This has involved a profound cultural shift; one which most Australian workers have embraced.

“The outcomes have been higher productivity, strong growth in real wages and low unemployment.

“Yet the Labor platform has the potential to reverse cultural change and undermine these gains through moves to re-centralise wage fixing and increase intervention by third parties.”

The Access report notes that removing or diminishing the level of flexibility that the current workplace relations system affords would also:

  • Lessen the economy’s overall productivity.
  • Make it difficult for the ALP to achieve its stated policy objectives of keeping unemployment below 5 per cent and sustaining maximum economic growth.
  • Diminish the capacity of business to create the flexible part-time positions needed to encourage older people to remain in the workforce and provide job opportunities for younger people and women.
  • Impact more negatively on the performance of sectors such as manufacturing, retail, farming and mining.

Mr Chaney said: “As the Access paper concludes, Australia’s labour force structure is becoming ever more mature and sophisticated as we integrate with the global economy. The new knowledge based workplace encourages flexibility on the part of both employees and employers. In this environment we need greater flexibility, not less, if we are to maintain our standard of living.

“The thrust of Labor’s proposals contrasts not only with the direction of reforms over the past decade or more but deregulation in most other areas of the Australian economy.

“At the heart of business concerns is Australia’s capacity to remain competitive, though a modern workplace relations system that promotes opportunity, growth and higher standards of living.”

The Business Council of Australia represents the chief executives of Australia’s 100 leading companies. Collectively, BCA Member companies employ nearly 1 million Australians and account for one third of Australia’s export activity. The BCA’s aspiration is that Australia should be the best place in the world to live, learn, work and do business.

Assessment of the Australian Labor Party Workplace Relations Policy Platform