‘The Federal Government’s Work Choices legislation is neither simple nor fair.’
Aftermath of the Work Choices Legislation Enactment
A few months after the Workplace Relations Regulations 2006 became effective; the governments of New South Wales, South Australia, Western Australia, Queensland and Victoria together with Unions NSW and Australian Workers Union challenged the constitutionality of the statute in the High Court. The arguments revolved around the applicability of section 51 of the Australian Constitution to industrial arbitration. Section 51 provides the Commonwealth Parliament with the power to legislate regarding “foreign corporations and trading or financial corporations formed within the limits of the Commonwealth”. This provision became popularly known as the ‘corporations powers’. In relation to this provision, on one hand, the state governments contend that section 51 does not contemplate its use for industrial arbitration. The issue of the extension of the provision covering corporations to employees as the work choices legislation does was raised. Moreover, the solicitor general of New South Wales propounds that the work choices legislation should have been deemed unconstitutional since the establishment of the federal government more than a century ago. State governments contend that states hold power for industrial relations so that the work choices legislation was enacted outside of the ambit of power of the commonwealth legislature. On the other hand, the federal government argues that the work choices legislation is consistent with the constitution and permitted by section 51. After the submission of arguments, Justice Haynes criticized the contentions of the state government as ill-prepared and that the difference in the context of labour relations more than a century ago compared to the present could change the interpretation of constitutional provisions. (2006) The enactment of the work choices legislation has opened constitutional issues affecting the relations between states. Tackling the simplicity and fairness of the work choices legislation does not only focus on the merits of the provisions but also extends to the bigger issue of its constitutionality and the consistency between the state and federal legislation powers. Work Choices Legislation Principles & Provisions Statutory Coverage Issues Coverage of the work choices legislation extends to employers and employees falling under Australia’s new federal system. The work choices legislation system operates by combining constitutional powers in order to provide a uniform labour relations statute covering majority of employers and employees in Australia including financial, trading and foreign corporations together with their employees, employers and employees in the ACT, Northern Territory and the Islands, commonwealth authorities and its employees, employers and employees of waterside, maritime and air commerce operating intra or inter territory, interstate and overseas, and most employers and employees in Victoria. (2006; 2006) In considering the initial issue of statutory coverage, the work choices legislation does not offer much simplicity because there are a number of qualifications to coverage. Employers and employees falling under the new federal system are covered by the work choices legislation. However, the coverage of the statute provides the employers and employees under the entities and firms included under the new federal system indicating that coverage under the new federal system is qualified by the categories of constitutional corporations and other categories mentioned above. To determine if an entity or firm is covered by the new federal system it must first be determined whether the entity is a constitutional corporation. If so, then the entity is covered by the new federal system making it fall under the operation of the work choices legislation. For other entities not qualifying as constitutional corporations, other categories apply such as the type of business including financial, trading and foreign corporations and territorial location such as ACT, Northern Territory and the Islands. This means that in determining coverage, employers and employees have to determine whether they are covered based on the general rules taken together with the various qualifications. Doing this task takes time especially when the guidelines are not clear enough to be applicable in different circumstances and there are differences in opinion over the operation of the qualifications. The operation of the work choices legislation involves various transition periods for the different circumstances. The statute provides that employers and employees covered by the federal system before the enactment of work choices will receive entitlements currently received prior and during the transition into the work choices legislation system. Constitutional corporations together with other employers not currently forming part of the federal system but are nevertheless covered by the statute will become covered by the new federal system. ( 2006; 2006) The operation of the transition provision entails two things. One is the application of current entitlements until such time that the work choices legislation provisions are fully integrated into the human resource management system of the entities covered. This offers a semblance of simplicity since it recognizes and clarifies the process that entities covered by the work choices legislation have to go though before fully integrating under the coverage of the law. The other is the further clarification on coverage. Constitutional corporations do not necessarily fall under the new federal system but constitutional corporations covered by the work choices legislation also become covered by the new federal system. Employers and employees need to consider whether they are constitutional corporations. If so the next thing to consider is whether they form part of the new federal system or not, with the criteria for falling under the federal system dotted with qualifications. If not, the last consideration is whether they are covered by the work choices legislation, with the criteria for coverage further mottled with qualifications. If employers and employees interested in determining wether they are covered by the law successfully pass through the general guidelines and qualifications to learn that they are covered by law then current entitlements apply prior to full transition. There is a separate transitional system for employers and employees of corporations that do not fall under the federal system before the commencement of the work choices statute. These corporations are provided with a five year transition period within which to decide whether they would like to be incorporated into the new federal system. After this period, the corporation opting not to join the new federal system would fall under the state system. Moreover, the employees not eligible for coverage under the work choices such as employees of unincorporated business firms, a number of state government employers, and sole traders or partnerships except those entities or firms falling under these categories in Victoria together with the territories will fall under the coverage of relevant state laws. (2006; 2006) This means that in the operation of the work choices legislation, entities are classified under the general division of mandatory coverage and coverage by choice. The entities mandated by the federal statute to be covered by law follows the guidelines for coverage and transition. Entities not covered by the mandatory application of the law are given the option by the statute to decide on their coverage. The period given to decide the option for coverage is five years. It is also within the five year period that entities choosing to be covered pass through the transition period prior to integration into the new federal system. Otherwise, if entities opt not to be covered by the work choices legislation, then these would be covered by state law. Coverage in the operation of the work choices legislation turned out to be a complex matter in terms of actual compliance by employers and employees. There are several considerations requiring attention even before the assessment of the operation of the law itself. Employers and employees need to determine whether the entities under which they belong are covered by mandatory or optional coverage. In mandatory coverage they have to determine whether they are covered under the general rule or if not whether they are covered based on the qualifications. This would determine the transition rules. In optional coverage, they have five years within which to decide coverage and integrate into the new federal system. These seem simple enough but with the interplay of state and federal laws, the consideration of these issues becomes more complicated in application. ( 2006) Employer Issues The primary concern of employers towards the work choices legislation is the added burdens to their business operations such as additional record-keeping tasks, greater coordination in compliance, and necessary balanced consistency between the federal and state labour laws. Initially, business firms answer in the affirmative when asked about their perception of the work choices legislation. Positive answers are usually based on knowledge of the purpose of the federal law of simplifying and clarifying labour legislations as well as providing uniform guidelines applicable to widest coverage possible for employers and employees. However, after experiencing the operation of the law, business firms develop concerns on the viability of the statute. There are two general concerns on the part of employers. The first concern is the lack of complete information on the guidelines to achieve compliance (2006). Lack of information then prevents business firms from fully understanding the provisions of the law in order to determine whether they are covered by its provisions by legal mandate or as an option. They also find it difficult to determine the areas of labour relations that should be adjusted to comply with the law. There is also the apprehension towards the manner of determining the balance or compatibility between federal and state laws in order to comply with federal and state laws without incurring any actions for violations of any or these jurisdictional legislations. The lack of information is caused mainly by the concentration of business efforts towards the viability of its business operations since it already has an existing human resource management system previously deemed compliant with labour laws prior to the work choices legislations. Business firms lack the time and resources to seek comprehensive information in order to support full compliance with the work choices legislation. Having a complete knowledge of the operation of law involves consultations with the internal legal team or if there is none with an external legal firm. Expected changes due to the operation of the work choices legislations also involves resources in terms of changes in the human resource management system such as the establishment of new labour relations infrastructures and training of managers and selected personnel. These comprise additional financial burdens to business firms that affect their business operations. Confusion and the complexity of the work choices legislations also prevent compliance that adds to the apprehension of business in addressing legal compliance in their operations to prevent unnecessary delays and hang-ups in the future. The second concern involves the administrative burdens that come with the operation of the law such as additional paper work and compliance requirements (2006). The concern of business firms towards additional administrative burdens is based on the necessary transition period for business firms covered by the work choices legislations by mandate or by option. Transition means that there would be duplication in paper work as business firms still maintain the current entitlements but at the same time gradually establishing the new system. During this period, there is also need to conduct information drives throughout the entire organization in order apprise concerned individuals on the changes to be expected and their necessary contribution to the achievement of the change necessitated by law. The process of transition involves shifts in the organizational structure, changes in task delineations as well as the necessary paper work documenting these changes. Employee Issues Employee issues regarding the work choices legislations mainly focus on the consequences of its legal provisions, particularly those that affect the rights of unions and collective representation related to the issue of fairness of the law. In Australia, 23 percent of the workforce has trade union memberships. Out of this number, only 17 percent are employed in the private sector. This means that majority of employees with union membership are employed by government entities (2006) Several unfair provisions have been pointed out by union leaders. One provision is the requirement of secret ballots prior to the extension of legal protection to industrial actions (2006). In practices this provision works against the ability of unions to hold concerted action. Holding secret ballots mean that the employer becomes apprised of the impending industrial action giving the employer time to determine options of preventing the action or even influencing the casting of ballots. These defeat the purpose of concerted action. Another provision is the prevention of union entry in business firms with all employees covered by the Australian Workplace Agreements (2006). This agreement comprises a contract between the employer and individual employees indicating the rules governing the employer and employee relations. The contract is binding between the parties provided only that it complies with certain mandatory requirements such as the inclusion of occupational health and safety as well as compensation and training arrangements. This means that the contract could even circumvent state laws as long as there is sufficient compliance with the necessary inclusions. The lack of unions in this type of working environment prevents employees from holding any action against the labour practices of the employer as long as these practices no matter how unfair are not deemed as violating labour laws. Thus, the provision opens a situation where employees individually negotiate with employers without the benefit of collective bargaining in the context of the recognition of the innate inequality in the status and bargaining power of employers and individual employees. Still another provision covers orders involving no strike together with a cooling-off period in case of the determination of significant harm accruing to third parties (2006). In theory these provisions provides a semblance of order to concerted action and ensures the safety of third persons. However, these provisions can be easily manipulated by employers in order to prevent or arrest any plans or actual concerted action by employees. Depending upon the strength of the union, a no strike order dissipates what could have been an available alternative channels for grievance venting of employees. The determination of significant harm and the identity of third persons are also subject to varying opinions requiring intervention in application. Lastly, another provision involves the power of the minister to terminate bargaining period in case doing so is deemed to prevent the effects on essential services or avert dangers to the economy (2006). On one hand, this is a sound public policy because it secures the welfare of the public by preventing any effects of the bargaining process to the continued provision of essential services and other economic factors. On the other hand, this weakens the right of unions to seek collective bargaining without providing any viable alternative or channel through which union members can collectively negotiate employment terms. Answering the Issue of Simplicity & Fairness The federal work choices legislation is not simple or fair with the brunt of the issue of simplicity greatly experienced by employers and the fairness issue felt by employees. The work choices legislation is not simple because it involves the issue of constitutionality raised by state governments in the High Court. Although the law remains valid, it involves informational difficulties and administrative burdens to employers negatively affecting compliance such as in the area of coverage. The work choices legislation is not fair to employees. In the case of union members, the restrictions provided by the work choices legislation mean lesser bargaining power for collective negotiations defeating the purpose of union membership. Lack of simplicity and fairness is also supported by the impending reforms despite the less than one year of its operation. It definitely has problems and the reforms should address the achievement of simplicity and fairness to establish a viable law.
Credit:ivythesis.typepad.com
0 comments:
Post a Comment