Retail industry groups, the National Retail Association and the Australian Retailers Association, have welcomed proposed industrial relations (IR) reforms lodged this week.
Minister for Industrial Relations Christian Porter lodged The Fair Work Amendment (Supporting Australia's Jobs and Economic Recovery) Bill 2020 to parliament on Wednesday, which aims to reform the below key IR areas:
- Award simplification – Cutting red tape, improving flexibility and job opportunities in 12 Awards covering the retail and hospitality sectors, which were hit hard by the pandemic and saw heavy job losses;
- Greenfields agreements – Boosting investment in job-creating mega-projects by making them more attractive to global investors through new maximum eight-year life-of-construction agreements, complete with appropriate safeguards and guaranteed wage increases;
- Casual employment – Ending the confusion and uncertainty surrounding the legal status of casuals, while providing a clearer pathway for those working regular shifts to convert to permanent roles after 12 months if they wish to do so;
- Enterprise Bargaining – Reversing the decline in agreement making by simplifying the 'better off overall test' (BOOT test) and setting a 21-day approval deadline to help drive productivity gains and real wage growth;
- Compliance and enforcement – Reducing the risk of wage underpayments by helping employers comply with their obligations, providing improved mechanisms to rectify underpayments where they do occur, and protecting employee entitlements by introducing a new criminal penalty with a four-year jail term for the small number of employers who deliberately exploit their workers.
Speaking on the proposed reforms, NRA CEO Dominique Lamb said that the organisation believes that the Bill provides employers and employees with more clarity around their entitlements.
"There has been big news out of Canberra this week after the Morrison Government unveiled key industrial relations reforms that strongly relate to the retail sector.
"As you’re all aware, ever since a 2018 Federal Court ruling there has been a high degree of uncertainty across several industries in relation to casual employees and ‘double-dipping’ claims.
"The NRA has campaigned strongly over the last two years on the need to provide greater certainty to both casual workers and employers on what entitlements should be paid to this level of employees.
"In good news, we believe that the proposed legislation announced by Attorney-General Christian Porter provides the clarity desperately needed.
"During the past six months, the NRA has been a contributor to the Attorney-General’s industrial relations working groups and advocated strongly for common-sense reforms to allow businesses to more easily offer additional shifts to their permanent staff," Lamb continued.
"We believe the Bill due to go before Parliament this week achieves this.
"Under the proposed legislation, employers will be required to offer permanent employment to a casual worker after 12 months if they have worked a regular pattern of shifts for the previous six months.
"The Bill also contains a statutory definition of casual employment within the Fair Work Act.
"A worker will be considered a casual if work is offered without “firm, advance commitment” of ongoing opportunities, with a worker able to reject work and receive a casual loading.
"The most important thing from the NRA’s perspective is that certainty is provided to employers," she said.
ARA CEO Paul Zahra broadly echoed Lamb's comments but said that there will still be some areas of friction when it comes to applying the reforms in practice.
"During what has been an incredibly volatile year for the retail industry, it is crucial to see retailers provided with greater certainty around casual employment, which provides many young Australians with job opportunities at the start of their working lives.
"The definition of casual employment addresses some concerns around existing arrangements and elevates the importance of what is agreed between an employer and employee, providing everyone with more freedom to determine the arrangements that best suit their situation.
"The way that employees agree to be hired is central to the way their employment is defined.
"Importantly, these changes clarify gaps in existing legislation, which may permit staff to “double-dip” on a casual loading and permanent employee entitlements – this needed to be urgently addressed.
"We believe changes to the casual conversion process are administratively heavy particularly for larger enterprises.
"However, the reforms address concerns around casual work by giving employees a guaranteed right to be offered a conversion to permanent employment.
This adds certainty and provides more choice for staff employed on a casual basis.
"There is still some friction between the determination of a casual and the reality of how they work, which is not ideal, but we believe that overall, the definition of a casual is a big step forward," he said.
However, the Australian Council of Trade Unions (ACTU) said that the Bill will allow employers to make arrangements that cut the wages and conditions of workers.
According to the organisation, the Bill will allow the Fair Work Commission (FWC) to approve agreements that do not meet the BOOT test for a period of two years.
The ACTU also said that the Bill will undermine and weaken the current protections and safeguards workers have to prevent employers imposing unfair agreements.
According to the ACTU, currently the FWC must ensure workers have access to an agreement for seven days and it must be properly explained to workers before voting and these requirements will be removed in the new Bill.
ACTU Secretary Sally McManus likened the proposed reforms to that of WorkChoices.
"These changes are dangerous and extreme.
"WorkChoices allowed employers to cut wages, and this proposal will do that as well.
"When WorkChoices was introduced employers rushed out to cut wages, the same will happen if this law passes. Some workers are still stuck with WorkChoices pay cuts some 13 years later.
"These proposals were never raised during months of discussions with employers and the Government.
"The union movement will fight these proposals which will leave working people worse off.
"This was not the spirit of the talks with employers and the Government, this is not about us all being in this together.
"Working people, essential workers, have already sacrificed so much during this pandemic, these proposed laws will punish them.
"The economy, local businesses will not be able to recover if workers are facing pay cuts.
"Families need the confidence to spend. You can’t heal the economy by hurting working people," she said.
The ARA added that while it broadly supports the reforms, it still holds some areas of concern.
"ARA will welcome changes to enterprise bargaining that strips red tape through reducing complexity of the system and speeding up approval processes.
"Retailers have been victims in the past of these complexities, with some agreements taking more than 12 months to go through the approval process, creating massive planning challenges and uncertainty for employees.
"While ARA supports provisions that promote compliance and ensure employees are paid correctly, there is a need to ensure that provisions which criminalise underpayments are not too broadly applied which will result in unintended consequences," the ARA said.
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