Industrial Landscape 2009 and Beyond. Stephen Smith, Director National Workplace Relations, Ai Group

Transcription

1 Industrial Landscape 2009 and Beyond Stephen Smith, Director National Workplace Relations, Ai Group

2 Topics Bargaining in the construction industry what is likely to change on the ground? Right of entry Modern awards in the construction industry Wilcox Review / ABCC National Code and Guidelines Superannuation Ruling OTE

3 Fair Work legislation FW Act operative from 1 July 2009, except for: National Employment Standards (1/1/2010) Modern awards (1/1/2010) Transitional and Consequential Bill still before Parliament Further State Referral and Consequential Amendment Bill introduced into Parliament this week (including some amendments to BCII Act) Draft Fair Work Regulations have been considered by the Committee on Industrial Legislation (COIL) Consultations with President of FWA

4 Institutions Fair Work Australia (FWA) replaces AIRC, Workplace Authority and Fair Pay Commission from 1 July (All existing AIRC Members appointed to FWA. AIRC President, J Giudice, is the FWA President) Fair Work Ombudsman (FWO) replaces Workplace Ombudsman from 1 July Specialist Division of FWO replaces the ABCC from 1/2/10 Fair Work Divisions of the Federal Court and Federal Magistrates Court

5 Bargaining in the construction industry what is likely to change on the ground?

6 Multi-employer agreements Multi-employer agreements will be available but: No industrial action can be taken in bargaining No coercion can occur Each employer must be specified The employees of each employer must approve the agreement (other than greenfields) Any variations require the approval of the employees of each employer covered

7 Multi-employer agreements (contd) At the industry level, unions are unlikely to pursue multi-employer agreements in most cases: No access to industrial action Difficult to meet approval requirements across a large number of employers Pattern agreements can provide similar consistency re. wages and conditions

8 Multi-employer agreements (contd) At the project level, multi-employer agreements will still be problematic for unions: No access to industrial action Impossible to identify all sub-contractors at the start of a project Very difficult to vary an agreement later to add further subcontractors Pattern agreements can provide similar consistency re. wages and conditions Multi-employer greenfields agreements might be attractive to unions in some circumstances Views of major contractors will be influential

9 Pattern agreements Likely to remain the construction unions main bargaining strategy at the industry and project levels FW Act does not outlaw pattern bargaining, but outlaws industrial action in pursuit of it Many important protections have been retained due to efforts of Ai Group: Tight definition of pattern bargaining Secret ballots

10 Pattern agreements (contd) Stop orders Injunctions CEPU complaint to the ILO unlikely to influence the Government s view

11 Greenfields agreements Ai Group secured vital 11 th hour changes to legislation: Can be reached with any union/s eligible to represent the majority of employees Public interest test applies The obligation in the original Bill to notify, and potentially bargain with, all relevant unions has been removed Ai Group s position supported by AWU but strongly opposed by CFMEU and ACTU

12 Enterprise agreements directly with employees All agreements under FW Act are called enterprise agreements - no separation between union and non-union agreements A union has the right to be covered, when agreement approved if it is a bargaining representative (regardless of whether it participated in the negotiations) but cannot veto A union is deemed to be the bargaining rep for each of its members unless another rep appointed by the member

13 Agreement content Will be a major issue in construction Unions are likely to test the boundaries 4 relevant categories of content: Permitted matters Unlawful terms Matters which are not permitted, but not unlawful Mandatory content Industrial action is protected if it is in pursuit of claims that are only about, or are reasonably believed to only be about, permitted matters

14 Agreement content (contd) Category 1: Permitted matters : Can be included in an agreement Are enforceable terms of the agreement Can be the subject of industrial action Permitted matters are: Matters pertaining to the employment relationship Matters pertaining to the relationship between the employer and the union/s who will be covered by the agreement Deductions from wages How the agreement will operate

15 Agreement content (contd) Category 2: Unlawful terms : Cannot be included in an agreement Cannot be the subject of industrial action Unlawful terms include: Discriminatory terms Objectionable terms (eg. provisions which breach freedom of association requirements, or require the payment of a bargaining fee by a non-union member) Certain specified terms which would undermine aspects of the unfair dismissal, industrial action and right of entry laws

16 Agreement content (contd) Category 3: Provisions which are not permitted matters but not unlawful terms : FWA will not generally be scrutinising agreements for this content Not enforceable terms of an agreement Cannot be the subject of industrial action Most of the provisions which unions want are now permitted matters so may not be a big issue But - income protection provisions may now fall in this category given the Federal Court s decision in Australian Maritime Officers Union v Sydney Ferries Corporation benefit not sufficiently connected to employment

17 Agreement content (contd) Category 4: Mandatory content: Flexibility term (Model term in Regs Deeming provision in Act) Consultation provision (Model term in Regs Deeming provision in Act) Dispute settlement term (Model term in Regs but no deeming provision) Specific content requirements if agreement covers shiftworkers, pieceworkers, schoolbased apprentices or outworkers

18 Agreement content (contd) Example clauses relating to labour hire and contractors: Permitted matter: terms relating to conditions or requirements about engaging labour hire or contractors if those terms sufficiently relate to employees job security eg. a term which provided that contractors must not be engaged on terms and conditions that would undercut the enterprise agreement (Explanatory Memorandum)

19 Agreement content (contd) Example clauses relating to labour hire and contractors (contd): Clauses preventing an employer engaging contractors who do not have an agreement with the relevant union breach the Trade Practices Act Loy Yang Case in 2007 Penalties: ETU: $125,000 plus $200,000 for legal costs of ACCC; IPM Operation and Maintenance P/L: $120,000. Not on the list of unlawful terms BUT FWA can refuse to approve agreements which would result in a person committing an offence under a Commonwealth law, and can refer to any person or body that it thinks appropriate eg. ACCC (s.192)

20 Good faith bargaining obligations Mainly procedural meeting at reasonable times, responding to proposals in a timely manner, etc Disclosing relevant information (other than confidential or commercially sensitive information) Refraining from capricious or unfair conduct that undermines freedom of association or collective bargaining A party cannot be forced to make concessions (Express provision included due to efforts of Ai Group)

21 FWA Bargaining-related Orders If a company initiates or agrees to bargain then good faith bargaining obligations apply cannot argue later that a majority of the relevant group do not agree to bargain. Caution! If the employer has not initiated or agreed to bargain, a Majority Support Determination can be sought by a union or employer A majority of what group? What is a fairly chosen group? Inclusion of white collar staff?

22 FWA Bargaining-related Orders Bargaining Orders if a party has not met the good faith bargaining obligations Scope Orders if bargaining is not proceeding efficiently or fairly and the reason is that the agreement will not cover appropriate employees. ( Fairly chosen group issue arises again) Serious breach declarations if serious and sustained breaches of a bargaining order have occurred and a party has exhausted other alternatives (eg. pursued penalty in Court) - If issued, FWA can determine a bargaining outcome Applications can be made by unions or employers

23 FWA Orders (contd) Timing of applications: Bargaining orders can be applied for 90 days before an enterprise agreement expires (including agreements made under the old legislation) Majority support determinations can be applied for anytime, so long as the employer has not yet agreed to bargain, or initiated bargaining Scope orders can be applied for after bargaining has started, if it is not proceeding efficiently or fairly re. coverage issues

24 Compulsory arbitration / determination powers of FWA In addition to other grounds - FWA has the power to suspend or terminate industrial action if: Industrial action engaged in for a protracted period of time ; Is threatening to cause significant economic harm to the employer/s and any of the employees, and harm is imminent If the industrial action is terminated: The next 21 days is the post-industrial action negotiating period As soon as the 21 days is over, if the parties have not settled all of the matters at issue, FWA must make a Determination

25 Coercion and discrimination re. types of agreements BCII Act provisions remain in force for the time being: Unlawful to coerce another person Unlawful to discriminate FW Act General Protections: Unlawful to coerce another person to make an enterprise agreement (other than protected industrial action) Unlawful to discriminate against an employer because employees are covered under a particular type of workplace instrument Head contractors will need to continue to take great care if they provide a model agreement to sub-contractors on a project, for the sub-contractors to decide whether they wish to use it

26 Nominated labour BCII Act nominated labour protections have been incorporated within FW Act due to efforts of Ai Group Unlawful for a union to coerce an employer to: Employ a particular person or contractor (individual or a firm) Allocate particular duties to an employee or contractor

27 Enterprise agreements other issues BOOT rather than No Disadvantage Test 4 year maximum term

28 Transitional Bill Ai Group is opposing many of the Senate Committee recommendations 110 Government amendments to Bill introduced into House yesterday Existing collective agreements and AWAs remain in force until terminated or replaced Pre-WorkChoices certified agreements and PSAs can be varied and extended for up to three years, but application needs to be made by 31 December

29 Transitional Bill (contd) NES will apply to all transitional instruments and new agreements from 1 January 2010 Special provisions for agreements made during Bridging Period Enterprise award modernisation process (up to December 2013) Industrial action: Notices of industrial action and ballot orders issued under WR Act expire on 30 June union must apply again FWA may take into account bargaining conduct prior to 1 July, for the purposes of relevant applications under FW Act

30 Union bargaining strategies Unions are generally waiting to bargain under the new laws Anti-pattern bargaining laws, secret ballot laws and immediate access to Courts if unlawful industrial action taken reduce the risk of another industry dispute like the 1999/2000 Victorian construction industry dispute, or Campaign 2000 / Campaign 2003 in manufacturing Economic environment is also having a big impact

31 Right of entry Entry to investigate suspected breaches Cannot inspect wage records of non-union members unless the employee consents or FWA issues an order Entry to hold discussions Based on eligibility to represent No longer linked to being a party to relevant award or agreement Representation orders Many of the existing protections remain, eg. 24 hours notice, employer can nominate the meeting room and route (but must be reasonable)

32 Modernisation of construction awards Massive exercise for the AIRC and registered organisations Huge drain on Ai Group s resources, but big risks for industry The AIRC is well-progressed on achieving what looked like an impossible task

33 Modernisation of construction awards (contd) Modern awards made for Construction Sector (operative from 1/1/2010): Building and Construction General On-site Award 2010 Electrical, Electronic and Communications Contracting Award 2010 Joinery and Building Trades Award 2010 Plumbing and Fire Sprinklers Award 2010 Mobile Crane Hiring Award 2010

34 Modernisation of construction awards (contd) Key issues: The Modern Construction Award applies to building, civil and engineering construction It only applies to on-site work and contains an exclusion for work carried out under Modern Manufacturing Award The Modern Manufacturing Award applies to the manufacture of most building materials and products A modern Joinery and Building Trades Award has been made with a limited scope applies to joinery work, shop fitting, prefabricated building, stonemasonry and glazing contracting work A separate modern award has been made for the mobile crane hiring industry

35 ABCC / Wilcox Review Labor policy: Replace ABCC with Specialist Division of FWA from 1 February 2010 Wilcox Review - 3 Ai Group submissions Further recent Ai Group / ACA submission to Fed Government on Wilcox Recommendations Recent meeting with the Deputy Prime Minister and DEEWR representatives

36 ABCC / Wilcox Review Recommendation 1: Building and Construction Division (BCD) to be located within the Office of the Fair Work Ombudsman and have operational autonomy under a Director, appointed by the Minister Advisory Board to determine policies, priorities and programs Dedicated funds

37 ABCC / Wilcox Review (contd) Recommendation 2: Provisions of Fair Work Act to apply re. conduct of persons and penalties Recommendation 3: Director to have compulsory interrogation powers but subject to the safeguards in Recommendation 4 the grant of this power to be reviewed after five years five-year sunset clause

38 ABCC / Wilcox Review (contd) Recommendation 4 (safeguards for compulsory interrogation power): Notice to attend to be issued only with authorisation of a Presidential Member of the AAT (satisfied by written material) Director or a Deputy Director of BCD to preside at all compulsory interrogations the Commonwealth Ombudsman to monitor use of the power all interviews to be videorecorded copies of reports, transcripts etc

39 ABCC / Wilcox Review (contd) Recommendation 5: Payment of expenses for persons summonsed for interrogation Recommendation 6: Provisions to be added to Part 5-2 of Fair Work Act for the proposed BCD rather than maintaining the BCII Act

40 ABCC / Wilcox Review (contd) Recommendation 7: BCD to have all of the same functions and responsibilities, in relation to the construction industry, as the Fair Work Ombudsman has for other industries Recommendation 8: Except perhaps in rural and remote areas, the BCD would have its own dedicated operational staff

41 ABCC / Wilcox Review (contd) No formal recommendations on Code and Guidelines but some views expressed: Desirable to retain the Code and Guidelines Preferable to limit the application of the Guidelines to on-site work Guidelines should become a disallowable instrument Makes sense for the BCD to determine whether an entity is Code-compliant Decisions on Code-compliance should be subject to judicial and administrative review

42 ABCC / Wilcox Review (contd) Confidential lock-up in Canberra tomorrow on new Code Implementation Guidelines - Unions will also participate Some key issues: Content of agreements Letter of the law vs spirit of the law Site practices Union proposals re. Government procurement Should the Guidelines become a disallowable instrument? New Guidelines will apply from 1 July 2009

43 OTE Superannuation issue New ATO Ruling on OTE from 1 July 2009 Big win for Ai Group! Superannuation is not payable on regular overtime Billion dollar cost averted Ai Group has been working to overturn the ATO s view since early 2007 Heather Ridout s discussions with the Treasurer Wayne Swan and Superannuation Minister Sherry were instrumental Should check compliance against new Ruling

44 Questions