Industrial Relations in Australia - Case Study Example

Running Head: INDUSTRIAL RELATIONS IN AUSTRALIA Industrial Relations In Australia [Name Of Student] [Name Of Institution] Introduction The current economy of Australia is based on workplace relation structures that are flexible and connect efficiency to proper rewards, thereby encouraging innovation and competence edge in the contemporary workplaces. It is possible for employees to discuss flexible agreements with their employers and consequently, the industry reacts to the challenges it faces in the global business environment. This was however, not always the case. In the decade of seventies, the bad state if trade combined with the shock that came from the oil prices significantly affected the capacity of the country’s economy to uphold growing living standards without avoiding the devastation of imbalance of payments. This led the following governments to propose a set of reforms which were meant to strengthen the industries in the global business market and hence the Australian economy (William, timothy, 2009: 21). The reforms that were introduced covered decrease in tariffs, elimination of foreign exchange controls and floating the Australian currency, all of which exposed the country to foreign competition. With global competition it was essential to make necessary changes to the labor market which resulted in the industrial relations agreements. They focus on giving dominance to the bargaining power of the organization and the environment instead of the former central-determined wage and working system. It is often argued that the Fair Work Act 2009 is a pale reflection of the Work Choices Act 2005 it replaced. In this paper I shall analyze the statement to see how valid it is. Discussion In order to understand whether the Fair work act 2009 is a pale reflection of the work choices act 2005 or not, it is first important to understand the two acts, along with their special features. The Workplace Relations Act 2005 (also known as the Work Choices Act 2005) was not a distinct or a new law; rather it was a major revision of the Workplace Relations Act 1996. The main aim of the Work choices act was to individualize working relations and also to marginalize the industry sector and trade union (Work Choices Act 2005). However, as it was observed in the case of the 1991 reforms of New Zealand, this new set of reforms did not succeed in completely taking over the former structure and the system of employee regulation. A few conventional components of the former system were present in this act as well but had lesser significance and scale. It basically offered a few noteworthy reforms, such as presenting the employers with a better chance in terms of conditions which they assess workers before offering employment as the workplace laws were now ruled by minimum statutory stipulations instead of awards (Work Choices Act 2005). Also it diminished the role of AIRC in deciding the conditions for job and also their role in solving issues related to workplace. Another feature of this was that it further complicated the entry of unions in workplaces or their capacity to organize industrial acts. Most importantly, it reduced to a great extent the employer’s exposure to unreasonable and unjust dismissal claims (Work Choices Act 2005). Another important aspect of The Work Choices Act was that it put into practice the government’s mission of achieving and aligning oneself to a sole state system of regulation. It did this by broadening the federal structure to encompass all corporations; trade, finance or foreign, and by exempting the employers from any kind of compulsion from state agreements or awards or any other employment laws. But the act did not have any provision to simplify the legislation (Work Choices: A New Workplace Relations System 2005). The Fair Work Act 2009 became the main highlight of the Labor government who claimed to progress forward with fairness in all workplaces. There were two major additions in this act as it introduced a new award method and also a new standard for State Employee standards (William, timothy, 2009:23). This new legislation is more comprehensible than the Work Choices Act and poses employers with the challenge to understand and function on the lines of the new set of rules that have been proposed as they strive to adapt to the new system (O’neill, 2007:13-4). Also, employers have to recognize the significance of the novel areas of law that are introduced; for example good faith bargaining and also the right given to ask for flexible working arrangements along with leaves. The main changes put forth by the Fir work act included the introduction of a group of legislated least standards that replaced the AFPCS of the work choices (Australian Fair pay and Condition Standard) (William, timothy, 2009:27-8). When observed from a broader perspective the national employment standard seems tot be almost identical to the former AFPCS, except for some important changes, most prominently the re-formation of a maximum working hours standard which is set at 38 hours and including the part timer employees in this standard along with regular employees, entitling employees to extended parental leaves request, as long as up to a year without pay. Married couples in the workforce, with this act, had the right to request a 24 months period (unpaid) as parental leave, permitting the right to ask for flexible working conditions and arrangements for employees who were looking after either a disabled or a pre-school child, certain cases allowed employees to en-cash their annual leaves and also some employees became legible for redundancy pay (William, timothy, 2009:29). Another important feature was the replacement of NAPSA by modern awards (William, timothy, 2009:36). It entitled employers and employees both, to discuss and consult for certain company agreements and were required to be subjected to good faith while doing so (Reith, 2008:44). AWA is to remain in force until replaced by another or ended. Certain new laws have been introduced like the new unfair dismissal laws which take away the former exemption valid on small entrepreneurs or small business owners (with a workforce of less than 100) (William, timothy, 2009). It has been replaced by a law that governs that employees in an company which has atleast fifteen permanent full time employees should have worked there for a certain minimum time period (which is one year) before being legible to make claims (John, 2005:47). The authentic operational reason has also been eliminated because the Fair work act considers it as just a reasoning to prove that dismissal was due to true redundancy. Also, the fair work act requires the employees to be earning the minimum threshold of income (108,300 Australian Dollars) before they are entitled to claim any unfair dismissal and also that all claims should be lodged within in a minimum time frame of 14 days from the day of dismissal and will accordingly be handled under the Fair Work Australia act. If an employee feels that his workplace rights have been breached upon, he is entitled to report that also (Reith, 2008:56). There is quite a significant presence of the Work Choices Act in the industrial relations legislation of Howard’s government in the Labor government of 2008. Initially, the labor government was swift to substitute the debatable and coercive aspects of the work choice acts. The fair work Act 2009 though a major revision in a few areas does not completely present the: pre-work choices system but is does reinforce the employees’ rights for protection (Reith, 2008:66-8). It is a fact that the main power of the constitution remains the power vested in the corporations. Though the new working environment in Australia under the Fair Work Act has more powers to solve issues than its predecessor had but it has eliminated the AIRC (Australian Industrial relations Commission) which many considered to be the most salient feature of the workplace legislations. There is no provision for the restoration of the test case functions either. Another important consideration is that the flexibility that the fair works act offers to individuals, may result in employers pressurizing these individuals to alter their conditions forcibly, that is without their true will to do so (Grayden ,2007:35-8). Also, the current shape of the Fair works act dictates that the real power is exercised by the legislation on the statue books over those who formulate policies. Though work choices act is no longer in play, but a strong presence of it features is felt in the fair works act. This might assist the future understanding of Australia’s contemporary framework for industrial relations to further explore the provisions offered by the former act (Bradon, 2005:51). If we analyze, the main essence of the work force act was in the fact that it introduced involved mobility of the main constitutional command on the basis of which the Federal government interfered in industrial dealings and issues with the reunion and settlement of power to that in the corporations, making stronger the position of individual negotiation and thereby decreasing the involvement of trade unions. It is nonetheless, quite difficult to distinguish a rational policy motive behind its introduction (Kevin, 2005:13). It was presented in haste in the absence of any strong evidence backed by government led economic research, very less considerations for public submissions and for an economy where all elements indicated boom of the system (Grayden ,2007:09). In the first place, there was little need for a radical transformation to the industrial systems in practice in Australia. After the enforcement, though economic pointers remained constant, the pay and working conditions for a lot of workers degraded. The government in its efforts to make the legislation fairer and just, continued to add more legislations, attempting to reach a harmony for employment agreements. But despite many efforts the influence remained largely the same. Many perceive the enforcement of work choice act as an expression representing neo-liberalism, mainly due to its focus on the aspect of individual bargaining but not because of the rise in micro-management or regulation (Punch ,2007:64-7). This was also in opposition to the Howard’s government claim of a simple and fair system for better industrial relations and a decline in regulation. It is important to note that liberalizing markets does not imply lesser government intervention and control but the expression used resulted in the release of the work choices act, indicating that it would reform the workplace for the employer and for the employees who would be able to operate without any government intervention (Dabscheck, 2006:33). The failure of the work choices act to disengage from the industrial relations in a more absolute form resulted in harsh debate from a wide variety of neo-liberal supporters and on the other hand, its manifest anti-employee bias became the center of criticism by trade unions as well as community groups. Conclusion Similar to the master/servant rules, even the implementation of the work choices act was limited by a number of factors (Collins, 2007:79). Employees, key stakeholders and trade unions did not lay down and this was coupled with the election of the labor government which significantly was a consequence of the worker’s delusion of the work choices act. The modification in the form of fair work act 2009 is merely a replica of the concepts previously introduced, punctuated by a few changes to make it appeal to people again. In reality, the fair work act is not as repressive or structurally illogical as the former work choices act. The modifications that have resulted in the industrial relation landscape over the last few decades have been noteworthy and make it compulsory for all employers to act in accordance to reduce their risks. The Australian economy is still in a transition phase from the work choices to the fair work act both of which were founded on the hypothesis that every employer has a proper HR program to administer its workplace and manage its workforce. References Andrews, Kevin (2005), Second Reading Speech, Workplace Relations Amendment (Work Choices) Bill 2005 (Cth), Parliament House, 2 November. Bradon Ellem, Marian Baird, Rae Cooper and Russell Lansbury, ‘“WorkChoices”: Myth-Making at Work’ (2005) 56 Journal of Australian Political Economy 13 at 26. Howard, John (2005), Prime Ministerial Statement: Workplace Relations, Parliament of Australia, 26 May. Hugh Collins, ‘Justifications and Techniques of Legal Regulation of the Employment Relation’ in Hugh Collins, Paul Davies and Roger W Rideout (eds) Legal Regulation of the Employment Relation (2000) O’Neill and I Kuruppu, Workplace relations reforms: a chronology of business, community and government responses, Background note, Parliamentary Library, Canberra, 6 December 2007 P Punch and M Sheils, ‘Labor — "junking" or only "massaging" Work Choices? Australian Industrial Law News, Issue 10, CCH, 5 November 2007. P Reith, Breaking the gridlock, towards a simpler national workplace relations system, (3 volumes) Department of Employment and Workplace Relations, October 2008. R Grayden ‘Gone but not forgotten R.I.P. Work Choices 26.3.2006-24.11.2007; A brief but spectacular life’, Australian Industrial Law News, Issue 11, CCH, 6 December 2007. Work Choices Act s 330; Braham Dabscheck, ‘The Contract Regulation Club’ (2006) 16 The Economics and Labour Relations Review 2. Workplace Relations Amendment (Work Choices) Act 2005 which significantly amended the Workplace Relations Act 1996. The constitutional issues have been reviewed in the Parliamentary Library’s bills digests on both the Work Choices and Fair Work Bills; see respectively Bills Digest No. 66 2005-06 and Bills Digest No. 81 2008-09. William L. Keller, and Timothy J. Darby: International Labor And Employment Laws, Volume Ii, Third Edition, With 2009 Supplement, 2009. Read More