Australia: Coalition Government begins to implement pre-election policies

Australia’s recently-elected Federal Coalition Government has begun implementing its pre-election policy relating to employment and workplace relations. Two bills recently released by the Coalition Government seek to increase regulation and accountability in the building and construction industry and within registered organisations. A third bill recently introduced to the Federal Parliament seeks to legislate the Coalition’s proposed changes to the superannuation guarantee. 

• The Fair Work (Registered Organisations) Amendment Bill 2013 (FWRO Bill) responds directly to the HSU scandal which involved misuse of member funds and provides for strengthened accounting and disclosure obligations on registered organisations (ie trade unions and employer organisations). Aimed at increasing the accountability and transparency of registered organisations, the FWRO Bill also creates an independent watchdog, the Registered Organisations Commission, which has investigation and enforcement powers, to monitor and regulate those organisations. Alongside heightened disclosure obligations, the FWRO Bill increases civil penalties and introduces criminal offences for serious breaches of officers’ duties. A table summarising key changes set out in the FWRO Bill can be viewed here.
• The Building and Construction Industry (Improving Productivity) Bill 2013 and Building and Construction Industry (Consequential and Transitional Provisions) Bill 2013 (the BCI Bills), if enacted, will fulfil the Coalition Government’s election promise to re-establish the Australian Building and Construction Commission (the ABCC). The ABCC regulated unlawful conduct on building sites from 2005 until 2010 when it was abolished by the former Labor Government and replaced by the Fair Work Building Industry Inspectorate, which had significantly reduced powers. The BCI Bills propose to restore the ABCC’s powers and functions but also impose a new prohibition on unlawful picketing, provide for higher penalties to deter unlawful behaviour and extend the reach of its powers to the building and construction supply-chain. A table summarising key changes set out in the Building and Construction Industry (Improving Productivity) Bill 2013 can be viewed here.
• The Minerals Resource Rent Tax Repeal and Other Measures Bill 2013 which seeks to repeal the minerals resource rent tax (mining tax) also seeks to delay increases in the superannuation guarantee rate for a two year period. If passed, the superannuation guarantee rate will remain at 9.25 per cent until 30 June 2016, will rise to 9.5 per cent on 1 July 2016 and will then rise in increments of half a percent a year until it reaches 12 per cent on 1 July 2021.

Further changes?

Recent announcements suggest that the Coalition will soon be releasing new bills to implement its pre-election policies relating to bargaining for greenfields agreements and the right of entry provisions under the Fair Work Act 2009 (Cth) (FW Act). Senator Abetz has told an employer forum that the Coalition’s proposed amendments with respect to right of entry and bargaining for greenfields agreements will be included in a single bill to be (hopefully) introduced during parliament’s first sitting in 2014.

Right of entry laws

The Coalition’s policy proposes that unions will not be able to enter a workplace unless:

• there is evidence that the union has members in the workplace who have requested their presence at the workplace, and
• the union is:
  • covered by an enterprise agreement applying at the workplace,
  • a bargaining representative seeking to make an agreement in good faith, or
  • not covered by an enterprise agreement or award applying at the workplace, but can demonstrate that it has (or previously had) a lawful representative role at the workplace.

Greenfields agreements

The Coalition’s policy proposes to apply the FW Act good faith bargaining rules to greenfields agreements. The policy further proposes that amendments be made to the FW Act that would enable an employer to take a proposed greenfields agreement to the Fair Work Commission for approval if the agreement: 

• has been negotiated for a period of at least 3 months,
• meets the ‘better off overall’ (BOOT) test and the public interest test, and
• provides for pay and conditions consistent with industry standards.

Employers have generally welcomed these proposed changes however, until 1 July next year, the Coalition will continue to face a hostile Labour-Greens voting bloc in the Senate. Thereafter, Senate numbers may still remain an obstacle to the Coalition’s ability to implement its proposed reforms, and much will depend on the position of the minor parties and the sole independent.

Written by John Cooper, Partner, Andrew Pollock, Solicitor, Ellen Williams, Solicitor and Melanie Smith, Solicitor, Melbourne.