Pro-union workplaces will damage economy: Business

By: Jason Whittaker

Fair Work Australia’s "heavy emphasis" on employee and union rights will hit the hip-pockets of business and the economy hard

Fair Work Australia’s "heavy emphasis" on employee and union rights will hit the hip-pockets of business and the economy hard , industry groups warn.

The bill - which passed through Federal Parliament today – creates a regulatory body that will facilitate and approve collective bargaining agreements, adjust minimum wages and deal with unfair dismissal claims and workplace disputes.

Under the new legislation, an agreement must be ruled as making employees "better off overall" and must comply with the 10 National Employment Standards for it to be approved.

The 10 'safety net' conditions have been included in the legislation and contain provisions for a 38-hour week, four weeks' annual leave and a right to request flexible working arrangements – have been included in the legislation.

Low income workers will now also be able to use enterprise bargaining.

If an employer refuses to take part in bargaining, FWA can force participation it finds a majority of employees want to collectively bargain.

Workplace Relations Minister Julia Gillard says the Fair Work bill will create a fairer system for both workers and employers, while unions say it returns the "fundamental right" to collectively bargain for better wages and conditions to Australian workers.

Australian Chamber of Commerce and Industry chief executive Peter Anderson disagrees, saying while some changes are welcome, the new rights and compliance obligations overwhelm the benefits and will add additional costs to employers, including non-unionised workplaces and smaller businesses.

"Although changes to current laws have been expected and some change is warranted, the combination of new employee and union rights and the new regulatory and compliance obligations will carry significant risks to employers, small business and jobs, especially in a period of slowing economic growth," he says.

However ACTU president Sharan Burrow argues the changes will help, not hinder, the protection of income and jobs in an uncertain economic environment.

"The Bill is another step towards reversing the damage done by a decade of anti-worker legislation by the former Howard Government," she says.

"Workers will be able to stand together with their colleagues and not be picked off individually as they were under WorkChoices."

The result is accusations of a collective bargaining system now "skewed to union interests".

"Giving unions unwarranted greater power increases the potential for industrial disruption. This comes at a time when the global financial crisis will see the commercial building sector slump in 2009, and will result in greater uncertainty in a sector that is fundamental to the rebuilding of the economy," says Master Builders CEO Wilhelm Harnisch.

"The agreement making process proposed by the Federal Government is a retrograde step for direct employer and employee engagement, which is essential to lifting productivity.

"We are concerned that with a 19 percent unionisation rate in the building and construction industry, the tail will once again wag the dog on building sites."

Ai Group chief executive Heather Ridout is consequently calling on unions to be "responsible" in their use of the new laws or risk causing economic damage "at the worst time for Australia".

One upside for businesses is the continued ban on pattern bargaining, however employers will only be allowed to lock out employees in response to action taken by workers.

In a compromise more than 50 percent of workers will now need to vote in a secret ballot before industrial action can be taken.

All employees will now also be eligible to apply for an unfair dismissal claim.

However, a worker employed with a firm of less than 15 people must be employed for at least a year before they are eligible.

Those who work for larger firms will be eligible after six months.

The bill also includes new modern awards which will begin on January 1, 2010.

Fair Work Australia will replace six other existing bodies, including the Australian Industrial Relations Commission, the Australian Fair Pay Commission, the Workplace Ombudsman and the controversial Australian Building and Construction Commission.

Unions say this creates an industrial umpire "with the teeth" to safeguard workers’ rights.

Industry groups are pushing hard for the establishment of a working committee when the bill reaches the Senate.

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