Beyond the federal election: workplace relations update

The dust has now settled since the surprise re-election of the Morrison Government last month and the subsequent Cabinet reshuffle. Now is a good time to consider what the focus of Government is in respect of workplace relations, and what this may mean for Australian employers.

On 24 June 2019, Prime Minister Scott Morrison addressed the Chamber of Commerce and Industry in WA in his first major speech since re-election that has touched on industrial relations issues. He indicated that a ‘key goal’ of Government is job creation which will be achieved by:

1. lowering taxes to enable Australians to take home a greater portion of their pay;
2. removing ‘regulatory and bureaucratic barriers to businesses’, for example, to ‘protect investment from the impact of militant unions’; and
3. boosting long term growth by lifting skills capabilities in emerging industries, such as advanced manufacturing, ICT and cyber-security.

The new Minister for Industrial Relations, Christian Porter, has been asked by the Prime Minister to ‘take a fresh look at how the system is operating and where there may be impediments to shared gains for employers and employees’. The Minister has indicated that his initial focus will be on the law enforcement aspects of the portfolio. As such, it is likely we will see the Fair Work (Registered Organisations) Amendment (Ensuring Integrity) Bill 2017 before Federal Parliament which is aimed at ensuring the integrity of unions and union officials.

Consistent with the Prime Minister’s message, the Minister has made clear that the Government will continue to focus on ensuring Australians pay lower taxes which, when combined with the minimum wage increase announced by the Fair Work Commission’s Expert Panel on 30 May 2019 (refer to our previous update), will increase the average Australian employee’s take-home pay.

Clearly, the workplace relations overhaul promised by the ALP’s election campaign will not take place (refer to our previous update). The focus of the Government appears to be working within Australia’s existing regulatory framework and achieving greater efficiencies within that framework.

Some key aspects of the Government’s workplace relations agenda include the following:

• Casual conversion: The Government introduced a Bill prior to the election (which lapsed following dissolution) to legislate for the right for all casual workers to request to convert to permanent employment. If reintroduced and passed into law, the legislation will require employers to carefully consider any conversion request they receive from a casual employee and ensure that such consideration, and any refusal to grant the request, is in accordance with legislative requirements.
• Enterprise agreement making: The object of any overhaul in this area will be to achieve greater efficiencies within Australia’s existing industrial relations system. The mechanisms and scope of changes have not yet been articulated. Employers who are active in the industrial relations space, particularly those likely to commence bargaining for new enterprise agreements in the coming year, will need to watch this space.
• Labour Hire Registration Scheme: The Government proposes to introduce a National Labour Hire Registration Scheme in the horticulture, cleaning, security and meat processing sectors (which are considered to be industries at a high risk of worker exploitation). The scheme will aim to protect vulnerable workers (including migrant workers), improve accountability, provide greater transparency and drive behavioural change among labour hire operators.
• Sham contracting: The Government has indicated in its 2019-2020 Budget that it proposes to give additional funding to the Fair Work Ombudsman (FWO) to establish a sham contracting unit. The purpose of this unit will be to target employers who knowingly or recklessly misrepresent employment relationships as independent contractors to avoid statutory obligations and employee entitlements. The unit will address sham contracting by increasing education, compliance and enforcement activities, and dedicating additional resources to investigate and litigate cases.
• Criminal sanctions: Prior to the election, the Government indicated it would accept recommendations of the Migrant Workers’ Taskforce Report, which included introducing criminal sanctions for serious and egregious forms of deliberate underpayment of workers (where employers currently face only civil penalties). It remains to be seen whether, and when, the Government will legislate for the introduction of such measures.
• Religious discrimination: As part of its election platform, the Government indicated it would introduce a dedicated Act prohibiting discrimination on religious grounds. The Minister has indicated that drafting of the legislation is well progressed. Depending on the extent of changes introduced, this may not have a particularly significant impact on employers given that discrimination against employees and prospective employees on religious grounds is already prohibited under the Fair Work Act 2009 (Cth) and certain State equal opportunity and anti-discrimination legislation.

We will continue to keep you updated on changes to Australia’s employment and industrial relations landscape as greater details become available.

This article was written with the assistance of Maia Joseph, Law Graduate.