The Senate

Education, Employment and Workplace Relations Legislation Committee

Fair Work Amendment Bill 2013 [Provisions]

May 2013

© Commonwealth of Australia ISBN: 978-1-74229-813-9

This document was produced by the Senate Standing Committee on Education, Employment and Workplace Relations and printed by the Senate Printing Unit, Parliament House, Canberra.

MEMBERSHIP OF THE COMMITTEE

Members Senator Gavin Marshall, Chair, ALP, Vic. Senator Chris Back, Deputy Chair, LP, WA Senator Catryna Bilyk, ALP, Tas. Senator Bridget McKenzie, Nats, Vic. Senator Lee Rhiannon, AG, NSW Senator the Hon. Matt Thistlethwaite, ALP, NSW

Participating Members Senator the Hon. Eric Abetz, LP, Tas.

Secretariat Mr Tim Watling, Secretary Ms Bonnie Allan, Acting Secretary (2 April – 10 May 2013) Ms Nerissa Stewart, Senior Research Officer Mr Isaac Overton, Research Officer Mr Tim Hillman, Inquiry Officer Ms Sarah Bainbridge, Administrative Officer

PO Box 6100 Ph: 02 6277 3521 Parliament House Fax: 02 6277 5706 Canberra ACT 2600 E-mail: [email protected]

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TABLE OF CONTENTS

MEMBERSHIP OF THE COMMITTEE ...... iii

RECOMMENDATIONS ...... vii

CHAPTER 1 ...... 1

Reference ...... 1

Conduct of inquiry ...... 1

Background ...... 1

Overview of the bill ...... 2

Key provisions of the bill ...... 3

Compatibility with human rights ...... 4

Financial Impact Statement ...... 5

Consideration by the human rights and scrutiny committees ...... 5

Acknowledgement ...... 5

Notes on references ...... 5

CHAPTER 2 ...... 7

Key issues...... 7

Family friendly provisions ...... 7

Protections for pregnant workers...... 12

Modern Awards Objective ...... 14

Anti-bullying provisions ...... 15

Right of entry ...... 18

Conclusion ...... 22

COALITION SENATORS' DISSENTING REPORT ...... 23

Introduction ...... 23

Regulatory Impact Statement ...... 23

Rural ...... 25

Getting the balance right ...... 26

Fair Work Review ...... 27

Right of Entry – Lunchroom Invasion and Joyrides ...... 29

Family friendly provisions ...... 31

Modern Awards Objectives ...... 34

Workplace Bullying ...... 36

Compulsory Arbitration ...... 39

Technical Amendments ...... 40

Conclusion ...... 40

APPENDIX 1 ...... 43

Submissions received ...... 43

Additional information received ...... 45

Answers to questions on notice ...... 45

APPENDIX 2 ...... 47

Witnesses who appeared before the committee ...... 47

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RECOMMENDATIONS

Recommendation 1 2.60 The committee recommends that the bill be passed.

CHAPTER 1

Reference

1.1 On 21 March 2013, the Senate referred the provisions of the Fair Work Amendment Bill 2013 (the bill) to the Senate Education, Employment and Workplace Relations Legislation Committee (the committee) for inquiry and report by 14 May 2013.1

Conduct of inquiry

1.2 The committee advertised in The Australian on 27 March 2013, calling for submissions by 15 April 2013. Details of the inquiry were also made available on the committee's website.

1.3 The committee also contacted a number of organisations inviting submissions to the inquiry. Submissions were received from 54 individuals and organisations, as detailed in Appendix 1.

1.4 A public hearing was held in Melbourne on 22 April 2013. The witness list for the hearing is at Appendix 2.

Background

1.5 After the commencement of the Fair Work Act 2009, the Government requested that a Fair Work Act Review Panel (the Panel), consisting of three independent experts, be established within two years. The Panel 'invited employee organisations, employer organisations and other interested parties to provide submissions in response to a background paper.'2 In June 2012, the Panel released its final report: 'Towards more productive and equitable workplaces: an evaluation of the Fair Work legislation'.3

1.6 The Panel's report included 53 recommendations to improve the operation of the legislation.4 The bill seeks to implement the second tranche of amendments

1 Journals of the Senate, 2013, p. 3865. 2 Department of Education, Employment and Workplace Relations, Fair Work Act Review: A review of the Fair Work Act took place in 2011 and 2012, http://deewr.gov.au/fair-work-act- review (accessed 15 April 2013). 3 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 1. 4 Fair Work Act Review Panel, Towards more productive and equitable workplaces: an evaluation of the Fair Work legislation, June 2012, p. 27. 2 suggested by these recommendations, with the first tranche having been implemented in the Fair Work Amendment Act 2012, passed by Parliament in December 2012.5

Overview of the bill

1.7 The bill was introduced in the House of Representatives by the Hon Bill Shorten MP, on 21 March 2013. The bill proposes to amend the Fair Work Act 2009 in order to implement a number of recommendations made by the Fair Act Review Panel that have not already been implemented in the Fair Work Amendment Act 2012, as well as various reforms that reflect the Government's workplace relations policies.6

1.8 Broadly, the bill proposes to:  introduce the right for pregnant women to transfer to a safe job, while providing flexibility in relation to unpaid parental leave so that special maternity leave taken will not affect the entitlement to unpaid parental leave;  require employers to consult with employees about changes to work hours;  amend modern awards to reflect the need to provide additional remuneration for employees working overtime, weekends or public holidays;  provide the Fair Work Commission (FWC) with the ability to deal with disputes between employers and Unions regarding the frequency of visits to premises for discussion purposes;  require interviews and discussions to be conducted in rooms agreed to by the occupier and permit holder;  provide accommodation and transport arrangements for permit holders in remote areas and to include limits on the amount that an occupier can charge a permit holder;  enable the FWC to deal with disputes concerning accommodation and transport arrangements; and  give the FWC the function of promoting cooperative and productive workplace relations while preventing disputes.7

1.9 The bill also proposes to implement the Government response to the House of Representatives Standing Committee on Education and Employment's report into workplace bullying. These amendments propose to:

5 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 1. 6 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 1. 7 Explanatory Memorandum, Fair Work Amendment Bill 2013, pp 1–2. 3

 Permit a worker who is subject to workplace bullying to apply to the FWC for an order to stop the bullying;  Incorporate a definition of 'bullied at work', into the bill that is consistent with the term 'workplace bullying';  Require the FWC to initiate work on an application for an order to stop bullying within 14 days of the application being made; and  Confer on the FWC the ability to make any order it deems suitable to stop the bullying.8

1.10 In addition, the bill incorporates a number of minor technical amendments.9

Key provisions of the bill

Family-friendly measures

1.11 The bill seeks to enable a female employee of an organisation to take leave instead of taking unpaid special maternity leave if that employee is entitled to paid personal leave.10

1.12 Additionally, the bill proposes to provide further flexibility in relation to concurrent unpaid parental leave, limiting the concurrent leave to eight weeks. Concurrent leave may be taken intermittently, but each period of leave must be more than two weeks.11

1.13 The bill proposes to expand the circumstances where an employee may request a change in their working arrangements. The amendment extends the right to request to an employee who: is a parent or has responsibility to care for a child who is of school age or younger, is a carer, has a disability, is 55 years of age or older, or is experiencing violence in their home life (or provides care and support for a family member who is).12

1.14 The bill proposes new requirements for employers to genuinely consult employees about changes to regular rosters or hours of work, and to consider the impact of the new work schedule on employees before making the change. Particular regard is to be given to the impact on the employee's family and caring arrangements.

1.15 The bill proposes to allow a pregnant employee the opportunity to present her employer with evidence that she is fit for work, but that it is not recommended for her to continue in her current position during the risk period, due to illness or risks

8 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 2. 9 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 2. 10 Fair Work Amendment Bill 2013, Schedule 1, Part 1. 11 Fair Work Amendment Bill 2013, Schedule 1, Part 2. 12 Fair Work Amendment Bill 2013, Schedule 1, Part 3. 4 associated with pregnancy or hazards arising from her position. The employer must then transfer the employee to a safe job without changes to the employee's conditions of employment (including current rate of pay), if such a safe job is available.13

Anti-bullying measure

1.16 The bill would allow an employee who has been bullied in the workplace to apply to the Fair Work Commissioner for an order to stop the bullying. The bill outlines that bullying at work consists of an individual or group of individuals continually behaving unreasonably towards the worker and that these actions create a risk to health and safety. In such cases, the FWC must deal with the application within 14 days of the date the application was made. The FWC is able to make an order to stop bullying if it is satisfied that a worker has been bullied and that there is a danger that the worker will continue to be bullied. The order can consist of any order the FWC deems appropriate, other than requiring monetary payment, to prevent any further bullying from occurring.14

Right of entry

1.17 The bill would amend the Fair Work Act 2009 to include provisions that a permit holder must conduct discussions and interviews in locations agreed with the occupier of the premises. This room may include an area where one or more of the interviewees usually take meal breaks, or a room that is provided by the occupier for the purpose of taking breaks.15

1.18 The bill also proposed to give the FWC the ability to deal with a dispute regarding the frequency of discussions organised by permit holders. The FWC may only make an order if it is satisfied that the frequency of entry by the permit holder is excessively diverting the occupier's critical resources. 16

Compatibility with human rights

1.19 The Explanatory Memorandum contains commentary on the bill's human rights implications, stating that it involves the following rights17:  The right to maternity leave;  The rights of parents and children;  The right to freedom of association; 18  The right to just and favourable conditions of work;

13 Fair Work Amendment Bill 2013, Schedule 1, Part 5. 14 Fair Work Amendment Bill 2013, Schedule 3, Part 6-4B. 15 Fair Work Amendment Bill 2013, Schedule 4, proposed section 492. 16 Fair Work Amendment Bill 2013, Schedule 4, proposed section 505A. 17 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 12 5

 The right to the enjoyment of the highest to the enjoyment of the highest attainable standard of physical and mental health;  The right to equality and non-discrimination in employment;  The right to a fair hearing; and  The right to privacy and reputation.

1.20 The Explanatory Memorandum maintains that the bill is compatible with human rights 'because it advances the protection of human rights. To the extent that it may limit human rights, those limitations are reasonable, necessary and proportionate.'19

Financial Impact Statement

1.21 The government has undertaken to announce financial implications of the bill as part of the 2013-2014 Budget.

Consideration by the human rights and scrutiny committees

1.22 The bill has not yet been considered by the Parliamentary Joint Committee on Human Rights. The Senate Standing Committee for the Scrutiny of Bills has considered the bill and did not have any comments in relation to the scrutiny principles outlined in Senate Standing Order 24.20

Acknowledgement

1.23 The committee thanks those individuals and organisations who contributed to the inquiry by preparing written submissions and giving evidence at the hearing.

Notes on references

1.24 References in this report to the Hansard for the public hearing are to the Proof Hansard. Please note that page numbers may vary between the proof and the official transcripts.

18 Including the right to fair wages, the right to safe and health working conditions and the right to protection of health and to safety in working conditions, including safeguarding of the function of reproduction. 19 Explanatory Memorandum, Fair Work Amendment Bill 2013, p. 12 20 Correspondence from the Secretary of the Scrutiny of Bills Committee to the Secretary of the Education, Employment and Workplace Relations Committee, 8 May 2013.

CHAPTER 2 Key issues

2.1 The bill has received a mixed response from submitters and witnesses. Employee and worker advocacy groups generally supported the bill, and many have made recommendations to improve the current proposals.1 In contrast, employer groups strongly objected to the bill, submitting that other more important reforms had been overlooked and that the amendments proposed by the bill would impose red-tape on businesses and be costly to implement.2 The key issues discussed in submissions and during the hearing in Melbourne related to the family friendly provisions, protections for pregnant workers, the anti-bullying measures and the changes to right of entry. Family friendly provisions 2.2 The family friendly measures proposed by Schedule 1 of the bill are targeted at providing increased flexibility in working arrangements for workers. The changes include more flexible parental leave, increased rostering protections, and expanded rights to request flexible working hours. Expansion of the right to request access to flexible working hours 2.3 The bill proposes to expand the circumstances where an employee may request a change in their working arrangements. The amendment extends this right to an employee who: is a parent or has responsibility to care for a child who is of school age or younger; is a carer; has a disability; is 55 years of age or older; is experiencing domestic violence, or provides care and support for a family member who is.3 The employer may refuse any request on the basis of reasonable business grounds, and the right to request may only be exercised by employees with 12 months of service. 2.4 The committee heard that the majority of requests made by employees are minor and a typical request would be to adjust commencement or finishing time by 15 minutes.4 Both employer and employee groups acknowledged that every day in Australia employers receive requests from workers for flexible hours and, in most instances, requests are carefully considered and employers make accommodations where possible. Employer groups submitted that for this reason, the amendments

1 See for example, Australian Manufacturing Workers Union, Submission 8; Community and Public Sector Union, Submission 17; Textile Clothing and Footwear Union of Australia, Submission 39; Queensland Working Women's Service Inc, Submission 41. 2 See for example, Master Builders Australia Ltd, Submission 4; Australian National Retailers Association, Submission 38; Real Estate Institute of Victoria, Submission 43; Business Council of Australia, Submission 50. 3 Fair Work Amendment Bill 2013, Schedule 1, Part 3. 4 Ms Belinda Tkalcevic, Senior Industrial Officer, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 10. 8 proposed should not proceed because they are not needed and would only serve to burden 'the vast majority of employers, who do the right thing, with over regulation'.5 In contrast, the Australian Council of Trade Unions (ACTU) and others submitted that the reforms proposed are required because of the very small number of employers that are not engaged in best practice.6 2.5 Access to flexible work arrangements is very important to Australian workers and the Australian economy. DEEWR cited research conducted in the United Kingdom that increased rights to request flexible working hours could improve productivity and that only 12 per cent of employers reported a negative effect, and the remainder reporting no impact.7 During the Melbourne hearing Ms Therese Bryant, National Women's Officer, Shop, Distributive and Allied Employees Association (SDA) submitted that: Many Australians quite rightly have the attitude that families come first. If families cannot get the flexibility at work which they need to balance their work and family responsibilities, then they will reduce their labour force participation with negative financial and wellbeing consequences for that family and for Australian society at large. If we want to increase the level of labour force participation other than by temporary migrant visas, an important measure will be to increase the practical availability of flexible working arrangements to employees while at the same time providing some security around rosters, with the knowledge that at least the impact on an employee's family will be considered in the event of the need to change.8 2.6 The committee heard that in order to make these amendments meaningful, employees need to have a right to request review of the process the employer took to consider the application. Mr Tim Lyons, ACTU, contended that review rights are necessary to make explicit that the employer is required to carefully consider the request, weigh up the advantages and disadvantages, and make reasonable efforts to accommodate the employee.9 The SDA described the right to request as a 'hollow

5 Mr Richard Cairny, Director of Policy, Business SA, Proof Committee Hansard, 22 April 2013, p. 49. See also, Mr Stephen Smith, Director, National Workplace Relations, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 17. 6 See for example, Ms Belinda Tkalcevic, Senior Industrial Officer, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 10. 7 Department of Education, Employment and Workplace Relations, Submission 30, p. 7. 8 Ms Therese Bryant, National Woman's Officer, Shop Distributive and Allied Employee's Association, Proof Committee Hansard, 22 April 2013, p. 35. 9 Mr Tim Lyons, Assistant Secretary, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 9. 9 right' without a review right.10 The Australian Human Rights Commission, and a number of other submitters, also supported a right to review.11 2.7 The Law Institute of Victoria cautioned that the expansion of the right to request may create 'an incorrect impression in the mind of the employee that employees are entitled to flexible work' and also called for review rights for employees where a request is refused for reasons other than reasonable business grounds.12 2.8 The Department of Education, Employment and Workplace Relations (DEEWR) advised that the decision was made not to include an appeal mechanism because the Review Panel found that 'employers are taking requests for flexible work arrangements seriously and that in the majority of cases employees can negotiate flexible arrangements despite the absence of an appeal mechanism'.13 2.9 Some witnesses and submitters recommended changes to the definitions of the class of people who may request flexible working arrangements. A number of submitters contended that the proposed description of the type of worker who can request flexible working hours is too narrow, and some workers who need to request flexible hours may be excluded, particularly those who have not served the qualifying period.14 Some submitters called for the provision to be amended to grant all workers the right to request flexible working hours.15 DEEWR explained that the terms in the proposed provision are not defined, because the provision is about 'facilitating a conversation'.16 2.10 For the purposes of the bill, a person is a carer if they meet the definition of 'carer' in the Carers Recognition Act 2010 (Cth). Carers Victoria acknowledged that some workers would benefit from a more expansive definition of carer. But in their submission stated that, on balance, the definition used in the bill was the right one for two reasons:  although a universal right to request flexible work for all employees may be more beneficial to carers than a more bounded one, there is recognition that a stepped approach to achieving change is more

10 Ms Therese Bryant, National Woman's Officer, Shop Distributive and Allied Employee's Association, Proof Committee Hansard, 22 April 2013, p. 34. 11 Australian Human Rights Commission, Submission 49, p. 3. Other submitters also supported this reform include, Dr Anna Chapman, Submission 34, pp 3–4 and Carers Victoria, Submission 45, p. 10; Jobwatch, Submission 54, p. 5; Queensland Working Women's Service, Submission 41, pp 3–4; Australian Domestic & Family Violence Clearinghouse, Submission 6, p. 1. 12 Law Institute of Victoria, Submission 12, pp 5–6. 13 Department of Education, Employment and Workplace Relations, Submission 30, p. 10. 14 See for example, SDA, Submission 27, p. 8; Australian Human Rights Commission, Submission 49, p. 3; Dr Anna Chapman, Submission 34, p. 5. 15 See for example, Work and Family Policy Roundtable, Submission 9, p. 2. 16 Mr John Kovacic, Deputy Secretary, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 52. 10 realistic, given Australia’s current political and industrial relations dynamics; and  the Amendment Bill’s reference to the Carer Recognition Act is an appropriate use of the Act. The Carer Recognition Act needs to be routinely applied to other legislation in order to develop currency and potency.17 2.11 Carers Victoria expressed concern that carers may be unduly impacted by the 12 month qualifying period before they can request flexible work arrangements. The bill as it stands only supports workers with new caring responsibilities who have worked with the same employer for more than 12 months. Long term carers however, 'require flexibility from their first day of work'.18 The ACTU agreed, and suggested that the definition of carer should be expanded to include workers who are yet to take on caring responsibilities.19 2.12 An employer may refuse any request on the basis of reasonable business grounds. The bill provides a non-exhaustive list of the types of circumstances that may be captured by this term, including: excessive cost, lack of capacity, impracticality, significant loss of efficiency or productivity, and negative impact on customer service.20 2.13 Some submitters argued that the reasonable business grounds exemption is too broad. For example, the ACTU observed that the 'reasonable business grounds' is a catch all provision and any cost implications for granting the flexible hours would meet the threshold.21 Dr Anna Chapman submitted that the proposed list of examples of reasonable business grounds is unhelpful, and suggested that the provision should 'be amended to ensure that the employer goes through a process of weighing up various factors, including the harm to the employee of not being accommodated, good management practices…[and] the employer's own interests'.22 2.14 DEEWR advised that the Review Panel 'rejected arguments that a definition of "reasonable business grounds" should be included in the legislation'.23 DEEWR submits that the addition of examples of grounds that constitute reasonable business grounds will assist: …both employers and employees by providing guidance on sorts of situations where it is reasonable for an employer not to agree to a request. As is made clear in the Explanatory Memorandum the list is not exhaustive

17 Carers Victoria, Submission 45, p. 7. 18 Carers Victoria, Submission 45, p. 9. 19 Australian Council of Trade Unions, Submission 25, p. 4. 20 Fair Work Amendment Bill 2013, Item 18. 21 Ms Belinda Tkalcevic, Senior Industrial Officer, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 10. 22 Dr Anna Chapman, Submission 34, p. 3. 23 Department of Education, Employment and Workplace Relations, Submission 30, p. 10. 11 and reasonable business grounds will always be determined having regard to the particular circumstances of each workplace and the nature of the request made.24 2.15 DEEWR submitted that articulating the right to request in the Fair Work Act can benefit employees because more formal requests for flexible hours are likely to be made, and agreed to.25 The committee trusts that further consideration will be given to expanding and clarifying the right to request flexible working hours when the bill is amended again in the future. Consultation on changes to rosters 2.16 Part 4 of Schedule 1 of the bill proposes new requirements for employers to genuinely consult employees about changes to regular rosters or hours of work, and to consider the impact of the new work schedule on employees before making the change. Particular regard is to be given to the impact on the employee's family and caring arrangements. 2.17 Employer groups strongly objected to this proposal, submitting that this amendment reduces flexibility and is problematic where businesses need to quickly respond to changing circumstances.26 During the Melbourne hearing Mr Cairney, Business SA, submitted that the proposed changes would make consultation unworkable, particularly for small business. Indeed, Mr Cairney argued that the proposed requirement to consult would result in a loss of the grape harvest: The consultation regarding losses et cetera takes no consideration of what impost that puts on employers, because our reading of it says that for almost every change to an employee's roster—and we are talking about individual employees—there has to be consultation. If I am in the wine industry and we are at vintage, to give you an example, once the sugar levels reach a certain level the grapes have to be picked. And they have to be picked quickly; otherwise, the sugar levels become too high and the quality of those grapes deteriorate rapidly. People working in that industry know that that is part of the industry, but if we are going to go through what is proposed in these amendments then, frankly, those grapes will not be picked.27 2.18 The committee asked DEEWR to respond to Mr Cairney's evidence. Mr O'Sullivan, Chief Counsel, disagreed that the consultation provisions are burdensome on businesses, and advised that the example provided about the sugar levels in the grapes increasing would not require roster consultation:

24 Department of Education, Employment and Workplace Relations, Submission 30, p. 11. 25 Department of Education, Employment and Workplace Relations, Submission 30, pp 5–6. 26 See for example: Business SA, Submission 7, p. 11; Australian Industry Group, Submission 36, Business Council of Australia, Submission 50. 27 Mr Richard Cairney, Director of Policy, Business SA, Proof Committee Hansard, 22 April 2013, p. 44. 12 I think there was a bit of a misunderstanding as to what these provisions relate to. They apply to terms that will be included in modern awards and enterprise agreements, and these provisions will only apply to changes to an employee's regular roster or ordinary hours of work…the example that the witness gave, which is that an unanticipated rise in sugar levels—or whatever—would not require a change to a regular roster or ordinary business hours. It would be a change to the hours to do with a particular emergency, and that would not require such consultation under these provisions. 28 2.19 DEEWR explained that obligation to consult consists of three simple steps: to explain the changes to the employees, to hear the views of employees and then to consider these views and make a decision. There is no prescriptive process that must be followed beyond this and consultation must not occur within a particular time frame.29 The SDA called for the bill to be amended to add the word 'genuine' to remind employers that they must genuinely consider any views about the impact of the proposed change on workers.30 Committee view 2.20 Given that these changes are targeted at encouraging conversations between employees and employers, and there is no obligation to agree to requests and there is no review by the Fair Work Commission, it is difficult to accept arguments presented to the committee that these changes will impose an unfair administrative burden on businesses. Every day in workplaces across Australia employers are negotiating flexible working arrangements with employees and consulting about roster changes. The vast majority of employers are already accommodating the responsibilities of workers where it is practicable. Therefore, in large part, the amendments in the bill represent a codification of existing practice. Protections for pregnant workers 2.21 Schedule one also contains amendments to ensure the safety and wellbeing of pregnant workers. The proposed amendments clarify the operation of special maternity leave provisions, and provide pregnant employees with less than 12 months service with the right to transfer to a safe job. If no safe job can be found, the employee is entitled to unpaid no safe job leave.31 2.22 Employer groups rejected these proposed amendments, submitting that employers should not be required to find safe work or grant no safe job leave for an employee who has served less than 12 months. The Ai Group explained that extending

28 Mr Jeremy O'Sullivan, Chief Counsel, Workplace Relations Legal Group, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 54. 29 Dr Alison Morehead, Group Manager, Workplace Relations Policy, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 55. 30 Shop, Distributive and Allied Employee's Association, Submission 27, p. 4. 31 Department of Education, Employment and Workplace Relations, Submission 30, p. 12. 13 the right to request safe work provision, coupled with a no minimum period of service, impacts particular industries such as the lead industry where there is no safe work.32 The SDA explained that lead is dealt with in a very specific way and labelled the example provided as 'extreme'. 33 2.23 The Ai Group also suggested that the balance is not right if a woman could commence a new job and 'the day after they start could say, 'well, I am pregnant and I now want a safe job'.34 Ms Therese Bryant, SDA, responded saying that the suggestion that a woman would do this was 'absolutely ludicrous' and advised that she had never had an employer complain to her about behaviour of this kind.35 2.24 The committee heard that these proposed amendments should be viewed as technical amendments to address an oversight, as similar provisions to provide safe work have been in Australian legislation for 27 years.36 2.25 The ACTU observed that the decision by an employer to provide a safe job for a pregnant worker is usually an excellent investment for the company and usually only requires minor adjustments to work practice. The SDA advised that employers commonly adjust work duties to accommodate worker needs, most often for injured workers: The subjective decision around light work and suitable duties is something that employers are well versed in. They do it every day with an injured worker. They have to understand safe weights, lifting requirements, traffic management, climbing ladders, pulling loads, pushing loads, prolonged standing at checkouts. These are all issues that employers deal with every day with injured workers. A pregnant employee will present with some issues generally in our industry regarding lifting and that would not be an uncommon issue for a retailer to deal with at all. Also, there is the provision of seating where appropriate for a worker who is engaged in long-term standing, which is the nature of retail work. It is not a subjective thing. They have risk assessments done on it; it is the language that they speak every day in retail. So it would not be a foreign concept.37

32 Mr Stephen Smith, Director, National Workplace Relations, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 22. 33 Ms Julia Fox, National Industrial Officer, Shop, Distributive and Allied Employees Association (SDA), Proof Committee Hansard, 22 April 2013, p. 36. 34 Mr Stephen Smith, Director, National Workplace Relations, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 22. 35 Ms Therese Bryant, National Women's Officer, Shop, Distributive and Allied Employees Association (SDA), Proof Committee Hansard, 22 April 2013, p. 37. 36 See for example, Ms Therese Bryant, National Women's Officer, Shop, Distributive and Allied Employees Association (SDA), Proof Committee Hansard, 22 April 2013, pp 33–34; Mr Tim Lyons, Assistant Secretary, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 14. 37 Ms Julia Fox, National Industrial Officer, Shop, Distributive and Allied Employees Association (SDA), Proof Committee Hansard, 22 April 2013, p. 36. 14 2.26 DEEWR submits that these changes will ensure that all pregnant employees are safe at work and are not disadvantaged as a result of their pregnancy. The changes also protect the employers from having to pay no safe job leave for workers who have served for less than 12 months.38 2.27 The bill also seeks to enable a female employee of an organisation to take leave instead of taking unpaid special maternity leave if that employee is entitled to paid personal leave.39 This amendment implements the Review Panel's recommendation that taking special maternity leave should not reduce an employee's entitlement to unpaid parental leave. The amendment is proposed on the basis of fairness, DEEWR explains that: The Review Panel formed the view that there is little justification for reducing an employee’s overall unpaid parental leave entitlement on the basis that the employee is required (for reasons beyond her control) to access the special maternity leave entitlement.40 2.28 The ACTU described this reform as a 'sensible approach, given that leave is provided for a different purpose'.41 The Australian Industry Group noted that 'this provision would appear to have few adverse impacts upon employers'.42 Committee view 2.29 Employers have a long established duty to ensure that workplaces are safe environments for all workers. The committee agrees that the proposed enhanced protections for pregnant workers are sensible, and in large part consist of technical amendments to correct a previous oversight. Modern Awards Objective 2.30 Schedule 2 amends the modern awards objective set out in section 134 of the Fair Work Act. The amendment proposes that the Fair Work Commission, when making or varying a modern award, takes into account the need to provide additional remuneration for employees working overtime, unsocial, irregular or unpredictable hours, working on weekends or public holidays, or working shifts. 2.31 Employer groups opposed this reform, arguing that these considerations should be dealt with by the Fair Work Commission in its normal arbitration processes.43 Employer groups also suggested that the amendment would require every

38 Department of Education, Employment and Workplace Relations, Submission 30, p. 13. 39 Fair Work Amendment Bill 2013, Schedule 1, Part 1. 40 Department of Education, Employment and Workplace Relations, Submission 30, p. 12. 41 Mr Tim Lyons, Assistant Secretary, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 8. 42 Australian Industry Group, Submission 36, p. 4. 43 See for example, Australian National Retailers Association, Submission 38, p. 1; Victorian Chamber of Commerce and Industry, Submission 23; Real Estate Employers Federation of Australia, Submission 28; Business Council of Australia, Submission 50. 15 award to 'include overtime and penalty rates'44 and would result in 'hamstringing the Fair Work Commission in dealing fairly with penalty rates'.45 2.32 Employee groups supported this reform, noting that the proposed change largely 'reflects the status quo' that prevails in relation to awards and provides additional support for workers given 'the frequency and severity of attacks on penalty rates in proceedings before the Fair Work Commission'.46 2.33 DEEWR explained that the amendment introduces an explicit obligation on the Fair Work Commission to take into account penalty rates. However, the decisions as to what, if any, penalty rates should apply, still rests with the Fair Work Commission.47 Mr John Kovacic advised that the Fair Work Commission may still decide that additional remuneration is not appropriate, and indeed, some modern awards do not have 'provision for additional remuneration' because 'of the nature of work in that particular industry'.48 Committee view 2.34 The proposed amendment to the modern award objectives explicitly requires the Fair Work Commission to consider the need to provide additional remuneration for workers who are working unpopular hours. The proposed amendment does not purport to dictate to the Fair Work Commission the decision it must make in a particular case, and each case will be decided on its merits in the usual arbitration process. Neither does the amendment require additional remuneration to be paid in all circumstances, as some businesses fear it does. Anti-bullying provisions 2.35 Schedule 3 of the bill contains anti-bullying amendments to enable a worker who is bullied at work to apply to the Fair Work Commission for an order to stop the bullying. These amendments are part of the government's response to the House of Representatives Standing Committee on Education and Employment report Workplace bullying "We just want it to stop".49

44 Business SA, Submission 7, p. 12. 45 Mr Innes Willox, Chief Executive, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 17. 46 Mr Tim Lyons, Assistant Secretary, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 8. 47 Mr John Kovacic, Deputy Secretary, Department of Education, Employment, and Workplace Relations, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 56. 48 Mr John Kovacic, Deputy Secretary, Department of Education, Employment, and Workplace Relations, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 56. 49 House Standing Committee on Education and Employment, Workplace Bullying "We just want it to stop", 26 November 2012. 16 2.36 The SDA reported a significant increase of bullying in workplaces in recent years. The committee heard that raising claims of bullying often leads to further bullying. Vulnerable groups include injured workers, pregnant women and workers with caring responsibilities.50 2.37 All submitters and witnesses to this inquiry were united in opposition to bullying in the workplace.51 Disagreement focused on the best way to protect workers and provide an adequate means of redress. 2.38 Employer groups submitted that the proposed expansion of the Fair Work Commission's jurisdiction may interfere with internal workplace investigations and remedies, and the Fair Work Commission may not be equipped to promptly and adequately deal with complaints.52 Employers were concerned that employees who have experienced discipline will bring vexatious actions.53 Finally, the Ai Group, AMMA and others submitted that bullying should be dealt with as a work health and safety issue, and managed in that jurisdiction.54 2.39 AMMA explained that its members usually engage the services of an independent investigator to assess bullying claims promptly.55 The SDA advised that this was not the usual practice in the Retail Sector, where investigations are usually conducted by an internal person and are not always thorough or independent.56 2.40 The ACTU and the SDA view the proposed changes as an important first step and have also made some recommendations for how the provisions could be improved. The ACTU and the SDA recommended that the definitions used by the bill should ensure that all bullying behaviour is captured by the definition; particularly group bullying over a period of time. According to their recommendations, these

50 Ms Therese Bryant, National Woman's Office, Shop Distributive and Allied Employee's Association, Proof Committee Hansard, 22 April 2013, p. 35. 51 See for example: Master Builders Australia Ltd, Submission 4; Australian Manufacturing Workers' Union, Submission 8; Australian Mines and Metals Association, Submission 19; Australian Chamber of Commerce and Industry, Submission 48. 52 Mr Scott Barklamb, Executive Director – Industry, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 27. 53 Ms Lisa Matthews, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 28. 54 Mr Innes Willox, Chief Executive, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 21. 55 Mr Scott Barklamb, Executive Director – Industry, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 28. 56 Ms Julia Fox, National Industrial Officer, Shop, Distributive and Allied Employees Association (SDA), Proof Committee Hansard, 22 April 2013, p. 36. 17 changes are necessary to allow the Tribunal to deal with bullying complaints where they would otherwise be frustrated on a point of technical jurisdiction.57 2.41 The ACTU submitted that bullying is a workplace relations issue as well as a work health and safety issue. During the Melbourne hearing Mr Tim Lyons explained to the committee: I genuinely think that it is both. There is clearly an occupational health and safety dimension to bullying, but I think it is a general issue on behaviour and workplace relations. Therefore we think that these provisions are a sensible response. If the nation has a specialist workplace relations tribunal, this is an appropriate jurisdiction for it to have, given that there is significant evidence before the parliament in the form of that House of Reps inquiry that this is a very significant problem.58 2.42 The Department explained that these provisions are designed to work with rather than replace work health and safety legislation, and, further, that the reforms are necessary to help prevent bullying. Mr Jon Kovacic explained during the Melbourne hearing: The first point I would make in respect of the bullying provisions in the bill is that they are designed to complement not to supplant work health and safety legislation. The second point that I would make is that, in the context of the House of Representatives committee inquiry, which received in the order of 300 submissions, a constant theme in those submissions was the absence of a mechanism where a worker who was being bullied could seek quick redress to try and have the bullying stopped. It is against that background that that particular committee made a recommendation, one of the 23 recommendations, that the government should put in place a mechanism to give access to a speedy resolution or a mechanism to deal with allegations of bullying. That is what the provisions here do.59 2.43 DEEWR is working with the Fair Work Commission to provide advice about how the provisions in the bill will work in practice.60 Committee view 2.44 Employers and employees realise the damage that bullying wreaks upon workers, their families and on their productivity. All workplaces should be free from bullying and, where bullying complaints arise, it is imperative that prompt, independent attention is given to resolve complaints. The reforms do not prevent

57 Mr Tim Lyons, Assistant Secretary, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 12. See also, Shop Distributive and Allied Employee's Association, Submission 27. 58 Mr Tim Lyons, Assistant Secretary, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 13. 59 Mr John Kovacic, Deputy Secretary, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 53. 60 Mr John Kovacic, Deputy Secretary, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 58. 18 employers from resolving bullying complaints internally and the committee notes the evidence that this occurs in many instances. The amendments proposed by these provisions provide a safety net for employees when prompt and appropriate action is not taken by the employer. Right of entry 2.45 Schedule 4 contains a number of amendments to the Fair Work Act in relation to right of entry. The amendments relate to the location of discussions and interviews, and the facilitation of entry to premises in remote areas by permit holders. These amendments also change the Fair Work Commission's dispute settlement powers in relation to transport and accommodation arrangements, and the frequency of entry to hold discussions.61 Most of the proposed changes to right of entry received qualified support from workers and strong criticism from employer groups. The importance of access 2.46 The Australian Mines and Metals Association (AMMA) submitted that union officials have no need to access remote workplaces because meeting off-site would be safer and more convenient. Alternatively, union workers could communicate with workers via Skype or email.62 2.47 The Maritime Union of Australia (MUA) explained that access to remote sites is important as it enables union officials to provide support to workers after a tragedy. The committee heard that the intention of union officials in tragic circumstances is to offer support to workers – not to interfere with any investigation.63 The committee was provided with one example where access was not facilitated and workers did not receive support for ten days, and only after the intervention of the industrial regulator. Mr Michael Doleman, MUA, contrasted that experience with the response when tragedy struck on the Karratha Spirit. In this example, the employer promptly facilitated union access and this ensured that workers received appropriate support in the aftermath of the tragedy: On 24 December 2008 there was a tragic event on board that vessel when it was trying to disengage from the wellhead while a cyclone was bearing down on the vessel. A young man, a father of two beautiful children, was tragically killed when disengaging on the bow of that vessel... Half a dozen of his colleagues were on the focsle head, the front of the ship, when that incident occurred. It was a messy, messy site. They had to carry that man's body into the accommodation. They endeavoured to resuscitate which, unfortunately, they could not. Those guys were traumatised to the max. The company, Teekay Shipping, had a union official out there that day, Christmas Eve, without any question. They engaged with us. They knew the importance of having a friendly face, an official who looked after that

61 Fair Work Amendment Bill 2013, Explanatory Memorandum, p. 3. 62 Australian Mines and Metals Association, Submission 19, paragraphs 89–95. 63 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 1. 19 vessel and who knew the crew intimately, go out to that ship and comfort those crew who were in a traumatised state.64 2.48 The MUA explained that if employers do not facilitate access to remote locations then it is impossible to access that site – even if the MUA chartered its own helicopter. This is because 'it is physically impossible, if you could find one, to then land on a helicopter pad attached to the floating production facility without the right of entry.65 Concerns about facilitation of access 2.49 AMMA and a number of other employer groups expressed strong concern about the practical and cost implications of facilitating access to remote sites. AMMA advised that in many instances it will simply be too expensive and that the practical considerations are great.66 AMMA also suggested that the proposed changes would mean that at times employers would have to specially charter aircraft for permit holders, and there would not always be accommodation available. AMMA also expressed concern about cost recovery, submitting that a single helicopter ride could cost $30 000 and accommodation is limited.67 2.50 The MUA submitted that these claims need to be subjected to close scrutiny. The MUA acknowledged that at times there will be 'genuine circumstances' at the site that mean that the employer is unable to facilitate access. In these cases the MUA is happy to discuss alternative arrangements with the employer to determine the most suitable time for access to be facilitated, taking into account available transport and the work program.68 However, in many cases it is convenient for the employer to fly officers in and out on the same day. For example, divers and certain contractors are routinely flown in at 6am and flown home at 6pm.69 Lunch room as a default option when agreement cannot be reached 2.51 Employer groups were universal in their criticism of the proposal to specify the lunchroom as the default meeting space for unions and interested employees, when no other space can be agreed to (as the law stands, if an agreement cannot be reached then a request for review must be lodged with the Fair Work Commission). The chief reasons offered were that non-union employees should be able to have a meal break

64 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, pp. 1–2. 65 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 5. 66 Mr Scott Barklamb, Executive Director – Industry, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 30. 67 Mr Douglas Bradford, Principal Consultant, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 31. 68 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 5. 69 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 5. 20 without union officials present and that the law already provides that if union officials are dissatisfied with the room available, a request for review can be lodged with the Fair Work Commission.70 2.52 A number of submitters provided examples where employers have made it quite difficult for permit holders to meet with employees. The committee heard that in some workplaces inappropriate rooms are provided, at times to discourage employees from participating in discussions.71 The examples noted by the Review Panel included:  an employer providing access to only one room across a site 3 km long, where employees have a 20-minute break;  an employer providing access to half of a manager’s office, divided by a partition, where the manager sits on the other side; and  an employer providing access to a meeting room in an administration area that accommodates six employees where two lunchrooms are available, accommodating around 100 and around 30 employees respectively72 2.53 The committee also heard that union officials prefer to meet with interested workers somewhere private. For example, the MUA submitted that as union workers are usually a small proportion of workers on the rig, union officials will seek an agreed location that gives employees privacy and 'does not disturb other workers either in their meal breaks or in their recreation and down time'.73 The committee asked if the MUA ever had to meet in lunchrooms, and was told that this does not occur as 'there is always somewhere you can go'.74 2.54 The Department advised that these amendments will encourage parties to agree to a location for interviews or discussions and 'should assist to reduce the incidence of conflict between occupiers and permit holders'.75 Expansion of the Fair Work Commission's jurisdiction 2.55 Employer groups supported the proposed change to empower the Fair Work Commission to review complaints about the frequency of union visits to a site.76 The

70 See for example, Australian Industry Group, Submission 36, p. 12. See also, Australian Mines and Metals Association, Submission 19, p. 5. 71 See, for example: CPSU, Submission 17, pp 4–5; SDA, Submission 27, ACTU, Submission 25; Department of Education, Employment and Workplace Relations, Submission 30, p. 19. 72 Examples provided by the Australian Manufacturers Workers' Union cited in Department of Education, Employment and Workplace Relations, Submission 30, p. 19. 73 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 2. 74 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 3. 75 Department of Education, Employment and Workplace Relations, Submission 30, p. 19. 76 See for example, Australian Mines and Metals Association, Submission 19; Australian Chamber of Commerce and Industry, Submission 48; Ai Group, Submission 36. 21 MUA rejected this proposed change, submitting that there may be very legitimate reasons why officials may need to visit a particular workplace frequently. Where frequency is questioned the MUA would rather 'sit down with the employer concerned and with the officials who are frequently visiting the workplace and identify what the circumstances are'.77 During the Melbourne hearing Mr Doleman elaborated on this point: We just do not think one size fits all. We think that there needs to be an appropriate consideration of what the need is for visitations, and if there needs to be a modification or a reduction of those visitations then so be it. Or it may well be that the employer has not been briefed well enough as to why those visitations are taking place. We think a more conciliatory approach to that element is a better way to go because, quite frankly, if an arbitrated decision is taken and that union official or officials can no longer visit that workplace, the first thing that is going to happen is that the workers in that workplace are going to be dirty on their boss or their employer for reducing the right of entry to their officials. So what you can do is agitate—and create a worse circumstance than that which may already exist. In our view, Senator, the order of the day is, let's sit down and talk about what the rationale and the reasons are for those frequencies.78 2.56 The Department advised that the Review Panel observed that some permit holders were visiting workplaces too often, and this was having an adverse impact on employers. The Department noted that if the bill proceeds, the Fair Work Commission would still be required to determine each case on its merits and take into account the particular circumstances of the workplace and its workers: FWC will determine in each case, based on the particular circumstances, what is an unreasonable diversion of an occupier’s critical resources. This will ensure that FWC takes into consideration, for example, the relative size of the workplace and capacity for the employer to manage right of entry visits and mean that a permit holder’s legitimate entry rights are not restricted without due cause. In line with the Object of the right of entry part of the FW Act the provisions are designed to balance the right of permit holders to have discussions with employees in the workplace with the right of occupiers of premises and employers to go about their business without undue inconvenience.79 Committee view 2.57 The proposed changes to facilitate access by permit holders to remote sites are reasonable and in large part represent current arrangements between unions and employers. The proposal to establish the meal room as the default meeting place when no other place can be agreed is sensible, and will promote negotiation between parties.

77 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 3. 78 Mr Michael Doleman, Deputy National Secretary, Maritime Union of Australia, Proof Committee Hansard, 22 April 2013, p. 3. 79 Department of Education, Employment and Workplace Relations, Submission 30, p. 20. 22 The expansion of the Fair Work Commission's jurisdiction will also promote discussion between parties and promote informal resolution of disagreements. Conclusion 2.58 While offering general support, employee groups and a number of other submitters have made recommendations to expand protections for employees. In contrast, the bill has received strident criticism amongst employer groups. Having carefully considered the evidence provided, the committee is supportive of the bill. Certainly there are areas where further amendments should be made in the future, however the bill itself represents a good balance between the interests of employers and employees at this time. 2.59 The committee notes that the Minister for Workplace Relations intends to introduce further amendments to the Fair Work Act in the winter sittings. The committee trusts that these further amendments will address the areas of reform identified by employer groups as areas in need of attention.

Recommendation 1 2.60 The committee recommends that the bill be passed.

Senator Gavin Marshall Chair, Legislation

COALITION SENATORS' DISSENTING REPORT

Introduction 1.1 Coalition Senators are deeply disappointed that the Government has now sidelined the bulk of remaining Fair Work Review recommendations. Instead, Labor has used the so-called ‘Second Tranche’ to grant additional rights to union bosses without any explanation, and secondly, to respond to a separate report on workplace bullying. Similar sentiments were expressed in submissions to the Committee: …The priorities in the Fair Work Amendment Bill 2013 are overwhelmingly not those identified by the review panel. The government received 53 recommendations from its review panel and it has not seen fit to base to any large extent this major tranche of amendments on those recommendations.1 1.2 Coalition Senators also find the dishonesty of this Bill breathtaking. It has now been confirmed that many provisions, although announced with much fan-fare will have no actual impact whatsoever, for instance those relating to Penalty Rates. 1.3 Coalition Senators note that the provisions relating to unpaid 'no safe job leave' in this bill directly reintroduce elements of the Workplace Relations Act, despite the Labor party's derision of that Act. The re-introduction of a provision to protect all pregnant workers was confirmed by the Australian Council of Trade Unions during the public hearing in Melbourne: It has been in the legislation. We regard this simply as an oversight. Before Work Choices and, in my understanding, during Work Choices, through the Fair Pay Commission standards, this was a right and entitlement that all employees, regardless of their length of service, had. For some reason it has dropped out.2 Regulatory Impact Statement 1.4 Coalition Senators were disappointed to discover that this Bill had been granted an exemption from the requirement for a Regulatory Impact Statement. When questioned, Departmental Officers could not provide any substantive reason for this exemption, as the following exchange demonstrates: Mr Kovacic: An exemption was granted by the Prime Minister— Senator McKENZIE: On what grounds? Mr Kovacic: In terms of the grounds—

1 Australian Mines and Metals Association, Submission 19, p. 2. 2 Ms Belinda Tkalcevic, Senior Industrial Officer, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 14.

24 Mr Cully: No grounds were specified. That exception was— Senator BACK: Did the department make that request? Mr Kovacic: We will have to take that on notice…3 1.5 Witnesses expressed concern in relation to this exemption and an inability to understand the possible impact without such a statement. For example, Mr Daniel Mammone, Australian Chamber of Commerce and Industry, stated: For the purposes you have just alluded to, it is very difficult to understand the impact not only on the stakeholders—the employees, the workers, the employers—but also on the regulator. I understand that the proposed avenue from the Fair Work Commission's recent Senate committee estimates is that the representatives from the Fair Work Commission indicated that at the moment they did not have the resources to implement as part of these proposed measures. In our submission we have drawn attention in an indirect way to the number of applications under the unfair dismissal system, which appears to be tracking at just under 4,000 applications per quarter. This is a significant increase already on the resources of the Fair Work Commission. We have some concerns that it will be a system whereby applications must be dealt with in some way within a short period of 14 days.4 1.6 Given this Bill will affect every employer and employee in Australia, the Coalition believes that these changes would have benefited from a Regulatory Impact Statement for both the community and the Parliament to have a detailed understanding of what this Bill entails and the predicted real-world impact. 1.7 Coalition Senators strongly agree with sentiments expressed by the Master Builders Association in their submission that 'a fully formulated Regulatory Impact Statement should be prepared which objectively assesses the costs and benefits of the amendments'.5 Recommendation 1.8 Coalition Senators recommend that the bill not proceed without a Regulatory Impact Statement.

3 Senator Chris Back, Senator for Western Australia; Senator Bridget McKenzie and Mr John Kovacic, Deputy Secretary, Department of Education, Employment, and Workplace Relations, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 52. 4 Mr Daniel Mammone, Australian Chamber of Commerce and Industry, Proof Committee Hansard, 22 April 2013, p. 46. 5 Master Builders Australia, Submission 4.

25 1.9 As an aside, Coalition Senators note that courtesy of this exemption, a further Post Implementation Review of the Fair Work Act will now need to be conducted within the next two years.6 Lack of clarity and rushed bill 1.10 One possible reason put forward for the exemption to prepare a Regulatory Impact Statement was because of the rushed nature of the Bill. During the Melbourne hearing the Australian Mines and Metals Association commented: Senator BACK: This also takes me to the point: why do you believe there has not been a regulatory impact statement presented as part of this legislation? Mr Barklamb: Senator, I would not want to venture an answer on behalf of the minister but I might recall an observation that we think this was done in quite a hurry…7 1.11 The rushed nature of the Bill could explain the concern about a distinct lack of clarity that was identified in a number of submissions to the Committee. For instance, a vast majority of submissions from employee and employer groups as well as interested parties contained a number of suggested amendments – largely related to the wording of provisions to provide greater clarity. It is disappointing that the Government did not take the time to widely consult and ensure the language contained within the Bill was sufficiently tight. Rural 1.12 Mr Stephen Smith, Director, Australian Industry Group, advised the committee that rural industries require particular flexibility, and that the bill does not support the needs of businesses in rural and regional areas: I think in terms of the whole legislation, when you look at all of the elements, it is not going to be a piece of legislation that supports employment, supports flexibility, and these are issues that are extremely important in regional areas. Of course, the average size of a business in regional areas tends to be smaller. They need a lot of flexibility. Businesses tend to pay closer to award rates of pay in regional and rural areas. So what is needed is legislative reform that will make things more flexible while preserving fairness. This piece of legislation, we believe, goes in completely the opposite direction.8 1.13 Mr Innes Willox, Australian Industry Group, advised that employers and employees tend to have much closer relationships in rural and regional areas. During the Melbourne hearing Mr Willox submitted that:

6 Office of Best Practice Regulation Handbook. 7 Mr Scott Barklamb, Executive Director – Industry, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 29. 8 Mr Stephen Smith, Director, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 20.

26 I think you could also argue that the relationship between employers and employees is much closer in regional communities as well, because of the nature of those communities. Everyone knows each other. So there has to be a bit of give and take in those sorts of communities. When you are imposing rigidities on an employee-employer relationship, that makes it a bit harder to get that give and take going.9 1.14 Mr Willox also observed that the agricultural and food sector industries are an 'enormous growth area', however care must be taken not to burden this growing sector with rigid industrial relations laws that will constrain growth. Mr Willox argued that the measures proposed by the bill will 'stifle' growth 'opportunities in some places at some times'.10 Getting the balance right 1.15 Coalition Senators are deeply apprehensive towards the dramatic expansion of rights for union bosses in this Bill. We note that Ms Gillard has taken great pride that the Fair Work Act, as enacted in 2008, got the balance right. Indeed, in Ms Gillard’s first press conference as Prime Minister she said: 'I consulted for hour after hour with business leaders, with union leaders, with small business leaders to get the balance right'.11 1.16 This is something that has been repeatedly repeated, including as recently as 2012 where the Prime Minister said: 'we built a modern and fair system that has got the balance right…'.12 1.17 While the Coalition does not agree that Ms Gillard got the balance right in the first place, using her own logic Labor has failed to explain how this Bill – particularly provisions not recommended by the Fair Work Review and in the absence of a mandate for change – will affect that balance. Coalition Senators again pose the question, where is the balance now? 1.18 Further, Coalition Senators note that this Bill will take the count to more than 400 pages of amendments to the Fair Work Act since 2009. Coalition Senators do note with some concern the Australian Industry Group’s submission at Annexure A the detailed list of the 157 new or extended union rights under the Fair Work Act.13

9 Mr Innes Willox, Chief Executive, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 20. 10 Mr Innes Willox, Chief Executive, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 20. 11 Transcript of the Hon. Julia Gillard MP, Prime Minister designate, 24 June 2013 (Official Transcript). 12 Address to the NSW Australian Labor Party Conference, Prime Minister Julia Gillard, 15 July 2013 (Official Transcript). Details provided by the Australian Council of Trade Union, Response to Question taken on notice, 22 April 2013 (received 2 May 2013), Q1. 13 Australian Industry Group, Submission 36, Annexure A.

27 Fair Work Review 1.19 Coalition Senators again express deep concern that the vast bulk of this Bill does not deal with recommendations arising from the Fair Work Review. Given the importance of getting the balance right, the Coalition is disappointed that the government has chosen to clearly skew the Bill in favour of one side of this contested space rather than seeking the middle ground as the Prime Minister apparently sought to do. This is best evidenced by the response of employer groups when asked to provide their wish list of recommendations from the Fair Work Review. For example, the Australian Mines and Metals Association (AMMA) provided ten recommendations for reform that it believed 'should have been prioritised in any 2013 tranche of amendments to the 2009 Fair Work Act', describing these reforms as 'most urgent to enact', however these reforms 'were not prioritised by this government'.14 AMMA noted that the reforms listed were the most urgent within the existing 'Fair Work architecture, drawing from the recommendations of the Review Panel'.15 1.20 AMMA's response can be juxtaposed against the obvious delight of unions when asked the same question, again indicating that this tranche of amendments are more about keeping Labor stakeholders happy in an election year, and less about dealing with the reforms that are necessary to make our workplaces safe and productive. During the Melbourne hearing, the following exchange occurred: Senator McKENZIE: Were there any recommendations made by the review of the Fair Work Act that you would have liked to have seen included in the bill that has already gone through and obviously this bit of legislation? Ms Bryant: No. Senator McKENZIE: In terms of the review that was done of the act and the 53 recommendations that came out of it, which this bill is supposedly based on, of those 53 recommendations are there any that you are particularly enamoured of and that you would have liked to have been included but have not been included in the government's response? Ms Bryant: I am not aware of any.16 1.21 The evidence provided by AMMA and the Shop, Distributive and Allied Employee's Association clearly demonstrates this government's desire to appease unions by cherry picking recommendations from the review and increasing perceptions of class warfare, instead of working towards a balanced response to workplace relations.

14 Australian Mines and Metals Association, Submission 19, Supplementary Submission, p. 1 (the list of ten reforms are on p. 2). 15 Australian Mines and Metals Association, Submission 19, Supplementary Submission, p. 1. 16 Ms Therese Bryant, National Woman's Officer, Shop Distributive and Allied Employee's Association, Proof Committee Hansard, 22 April 2013, p. 41. The SDA acknowledged on notice that it would like reforms introduced to provide arbitration: Response to question taken on notice, 22 April 2013 (received 2 May 2013).

28 1.22 We have previously dissented, in the Committee’s report into the Fair Work Amendment Bill 2012 that: Despite the Review being a disappointing document on so many levels, Coalition Senators note that on certain issues the reviewers were mugged by stark realities. The Coalition has flagged general support for the review.17 1.23 Coalition Senators firmly believe that two recommendations in particular made by the Fair Work Review should have been enacted as a part of this Bill. Barclay v Bendigo TAFE 1.24 The High Court’s unanimous judgement in the Barclay v Bendigo TAFE case found that union bosses should not be an untouchable class in the workplace – something also recommended by the Review Panel. Coalition Senators welcome the High Court decision and the Fair Work Panel Review’s recommendation to this end.18 1.25 However, Coalition Senators found it disappointing and emblematic that Labor, through Minister Shorten, intervened in the High Court on the side of the union boss, Mr Barclay, arguing that it actually was the intention of the Fair Work Act to make union bosses untouchable even if they did the wrong thing. 1.26 Labor intervened in Barclay using more than $160,000 of taxpayers’ money to argue for the union bosses against a taxpayer funded education institution. 1.27 Indeed, in a damning judgement by High Court Justice Heydon, it has now been confirmed that Mr Shorten acted as an ex-union boss first, and Minister of the Crown second, after foolishly intervening on the side of the Australian Education Union in the Barclay v Bendigo TAFE case. Justice Heydon said: …the Minister's stance before and during the oral hearing was not that of an intervener, but that of a partisan. For example, some of the Minister's oral submissions were directed to factual material. This is hardly the province of an intervener…19 1.28 Coalition Senators are disappointed that the Government did not use the first nor second tranches to enshrine this recommendation into legislation that would ensure that union bosses are treated the same as all other employees in the workplace. JJ Richards 1.29 Then Opposition Leader Kevin Rudd pledged that the Fair Work Act would not allow the return of ‘strike first, talk later’. Yet, the decision of the Federal Court in the JJ Richards case tells a different story.

17 Coalition Senators Dissenting Report, Senate, Education, Employment and Workplace Relations Legislation Committee, Inquiry into the Fair Work Amendment Bill 2012, November 2012. 18 Recommendation 47. 19 Board of Bendigo Regional Institute of Technical and Further Education v Barclay [No 2] [2012] HCA 42 (3 October 2012), per Heydon J.

29 1.30 The Federal Court’s judgment accepts that the argument advanced on behalf of JJ Richards was understandable and reasonable but for the specific wording in the Fair Work Act which entitles unions to obtain protected action ballots in circumstances where most reasonable people would argue that should not be allowed. 1.31 The Government is yet to tell us whether this was simply a drafting error or that Labor deliberately misled the Australian people. Their silence is interesting and causes Coalition Senators to suspect the latter. 1.32 Coalition Senators believe that if the provisions of this case had exposed a drafting error, the Government would move with some speed to implement the stated policy that received electoral support at the 2007 election. Coalition Senators are concerned that should the Government not rectify this it will be viewed as another broken promise, in a similar vein to the Carbon Tax that Australians had to have despite promises to the contrary in 2010. Recommendation 1.33 Coalition Senators recommend that the Fair Work Review Panel Recommendations 31 and 47 be implemented as soon as possible. Right of Entry – Lunchroom Invasion and Joyrides 1.34 Coalition Senators have long been concerned with Ms Gillard’s broken promise, that there would be no changes to union right of entry laws. A promise made on the life of the Prime Minister’s own mother. Labor's Forward with Fairness document prior to the 2007 election contained an express commitment to retain existing right of entry provisions. The then Shadow Minister Julia Gillard directly told us: [We] will make sure that current right of entry provisions stay. We understand that entering on the premises of an employer needs to happen in an orderly way. We will keep the right of entry provisions.20 1.35 Based on these promises, it was rightly expected that the existing right of entry provisions would be maintained. However, as we know, this was simply just not the case. 1.36 Since the Fair Work Act came into effect, there has been a dramatic expansion of the laws relating to union access and we have seen an onslaught of visits. For example, it was recently reported that the Australian Workers Union made 156 site visits to BHP’s Worsely Aluminium site in 2012 and a further 175 in 2011 and the Pluto project experienced more than 200 union site visits in the first 90 days of the Act. The vast majority of these visits are either a blatant membership fishing expedition or designed to intimidate. 1.37 If the initial broken promise is not bad enough, we now have before the Parliament a Bill that would even further expand the right of entry laws. The concerns relating to expanded provisions proposed in this Bill are twofold: the first relates to

20 The Hon. Julia Gillard MP, Press Conference, 28 August 2007.

30 the default location, if the employer and union official cannot agree as being the lunch-room; and the second relates to the employer's liability for travel costs for union officials exercising a right of entry permit in remote locations. 1.38 Coalition Senators agree with the sentiment expressed by the Australian Industry Group at the hearing, that this measure is simply an attempt to increase union membership, and will not increase productivity: We are always very mindful that union membership in the private sector is at 13.2 per cent. That is not to say that the unions do not have a role, they have a very clear role. Where we have a concern about right of entry is that it would be a distraction in places for some employees and employees more generally. Being allowed back into the workplace as is proposed is in many ways a throwback to the 1970s. We have moved on in terms of the relationships. We believe that this will do nothing to promote productivity. It will do nothing to promote competitiveness. We just see it as an unfortunate way to try and drive up union membership. We have concerns on a whole range of levels about how that will impact within a workplace and within the workforce more generally.21 1.39 Coalition Senators draw attention to the fact that these two provisions were not recommended by the Fair Work Review Panel and that there do not appear to be any public interest considerations. Seemingly, there are no justifiable reasons why these changes would be of benefit to workers, employers or to the economy – the only party that stands to benefit are union bosses. Joy-ride scheme 1.40 Coalition Senators are concerned that employers will become responsible for the costs of transportation where access to the work-site is remote. 1.41 The Australian Metals and Mining Association pointed out in their submission that the costs of transportation to some regional and off-shore projects in the mining sector could cost in excess of $30,000 in transport alone on top of the costs of accommodation and on-site escorts. 1.42 The Australian Metals and Mining Association also pointed to the significant safety issues with many of these remote sites: The plethora of safety issues associated with union access to remote sites includes the fact that infrequent travellers require escorting on all offshore platforms and in helicopters to ensure their safety at all times. This is a further distraction requiring extra resources to be diverted while at the same time opening up the occupier to significant risk and liability.22 1.43 Coalition Senators firmly believe that these sites are not tourist sites or playthings for union salespeople. They are a place for highly specialised operational

21 Mr Innes Willox, Chief Executive, Australian Industry Group, Proof Committee Hansard, 22 April 2013, p. 20. 22 Australian Mines and Metals Association, Submission 19, p. 8.

31 workers who have undertaken weeks of intensive safety training, including underwater helicopter evacuation procedures.

Recommendation 1.44 Coalition Senators recommend that the provisions in the bill that make the employer responsible for travel expenses relating to right of entry be opposed. 1.45 The Bill contains a proposal that would make the default location for union officials to meet with employees the lunch room, in circumstances where an employer and a union cannot agree on a location. This will force the 87 per cent of Australian private sector workers who actively choose not to join a union to be constantly badgered by union bosses to sign-up for membership. Coalition Senators predict that the vast majority of union bosses will not agree to any other room. Coalition Senators believe that this change would simply send a green-light for a lunch room invasion by union bosses right around the country. 1.46 The Minister has failed to tell us why this is necessary or so pressing. Coalition Senators firmly believe that Australian workers should enjoy their lunch in peace and that this provision is a direct attack on the freedom of Australians to do so. Coalition Senators support the cameo used by BusinessSA in their submission: Can you imagine going to your local café to have a meal and a chat with a friend only to be confronted with someone who is trying to sell you something. And your only options are to sit and listen or leave?23 1.47 Coalition Senators believe that reasonable entry rules for union access should apply but not just so the union bosses can run rampant. It should be seen as a privilege that requires special treatment, not something to be bargained with to threaten and disrupt workplaces. Recommendation 1.48 Coalition Senators recommend that provisions that make the lunch-room the default meeting location relating to right of entry be opposed. Family friendly provisions Right to Request 1.49 This amendment simply legislates the ability for the employee, in particular circumstances, to request more flexible working arrangements from their employer. This Bill sets the bar very low for an employer to reject such a request and there is no recourse to the Fair Work Commission. 1.50 Coalition Senators view this as legislating something that already happens in most Australian workplaces where an employee could approach their employer of their own accord.

23 Business SA, Submission 7, p. 16.

32 1.51 Both the Fair Work Ombudsman and the Department have confirmed at Senate Estimates that there is nothing preventing such approaches happening under the current legislative regime. Coalition Senators support observations from the Law Institute Victoria in its submission that: The LIV has some concerns that a practical effect of the amendments may be to create an incorrect impression in the mind of the employee that employees are entitled to flexible work, rather than entitled to be considered for flexible work arrangements. The LIV considers that this may largely depend on how these amendments are communicated, as the wording of amendments themselves do not detract from the current position…24 1.52 Once again, this is clearly window-dressing to no actual effect. If the Government were genuine about wanting to achieve greater flexibility in the workplace for people in particular circumstances, they would accept the Fair Work Review panel’s recommendation to extend the termination period on an Individual Flexibility Agreement from 28 days to 90 days. This would benefit, for example, parents with childcare arrangements or grandparents wishing to spend less time at work. Parental Leave and pregnancy protection 1.53 This amendment changes the current qualifying period for unpaid ‘no-safe job leave’ from 12 months after commencement of employment, to immediately upon employment. As Coalition Senators have previously noted, the Australian Council of Trade Unions have confirmed that this provision previously existed in the Workplace Relations Act 1996, including through the now passed so-called WorkChoices era.25 Concurrent unpaid parental leave 1.54 The Bill extends from three weeks to eight weeks the concurrent unpaid parental leave that eligible members of an employee couple can take. Also, the eight weeks will be able to be taken in separate periods (of at least two weeks, unless a shorter period is agreed) at any time within the first 12 months of the birth or adoption of a child. Concurrent leave can presently only be taken when a child is born or placed. Rural areas 1.55 The National Farmers Federation (NFF) expressed concern that the family friendly amendments may be 'inherently unfair on agriculture employers'.26 In relation to the proposed obligation to consult about roster changes, the NFF submitted that the reform is:

24 Law Institute of Victoria, Submission 12, pp 5–6. 25 Ms Belinda Tkalcevic, Senior Industrial Officer, Australian Council of Trade Unions, Proof Committee Hansard, 22 April 2013, p. 14. 26 National Farmers Federation, Submission 10, p. 4.

33 …overly restrictive especially in relation to an agriculture workplace where the workflow is unpredictable at most times, depending on the weather and market. Farm businesses are generally family run and in our view, these amendments are unnecessary due to current flexible working arrangements being adequate. 27 Roster changes 1.56 The bill proposes to introduce new provisions to require employers to consult with employees on roster changes. It is worth noting that while there has not been a legislated requirement, it is a longstanding common practice that employees are consulted on changes to their rostering arrangements. 1.57 Modern awards are already required to contain provisions requiring an employer to consult with employees about major changes that have significant impact on employees. 1.58 That said, Coalition Senators are concerned that a lack of clarity in the wording could lead to unintended consequences as pointed out by Mr Barklamb of the Australian Mining and Metals Association at the hearing: Under the current drafting, no roster change would be too small to trigger the new consultation requirements, which may also act as a veto on implementing essential changes if misused. Once again no case has been made to depart from the existing approach—that is, the requirement to consult over major workplace changes, a longstanding part of our system. We foresee a confusing overlap of obligations and more red tape in the day- to-day organisation of work at the workplace level.28 1.59 Once again, in the absence of any detailed explanation from the Minister on why this change is so necessary and with a number of concerns expressed about the specific wording Coalition Senators recommend that this section should be reconsidered. 1.60 Business SA rejected the proposed requirement for employers to consult employees about roster changes. Mr Cairney submitted that employers are happy to consult with employees, however the proposed reforms introduces a new level of consultation that will be time consuming and have an impact on business – particularly business working in rural and regional areas. During the Melbourne hearing, Mr Cairney explained: It is not a burden about consulting; it is the level of consultation and how long it takes. If one looks at what is being proposed, one can only read it to say that you will not be to be able to do this in a short period of time. My point about the wine industry, as an example, is that somebody who starts in the morning on day shift could be asked to work that night to ensure the grapes are picked. It is not done at the whim of the employer. Quite the

27 Australian Farmers Federation, Submission 10, p. 15. 28 Mr Scott Barklamb, Executive Director – Industry, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 25.

34 contrary: it is done to meet a need of the industry. With some of these proposed amendments, one could be forgiven for thinking that employers do not talk to employees and do not consult; they do. But our reading of what is being proposed would be too burdensome. In our reading of it, it would take more than a short period of time. It could take a week or more in terms of what is being proposed.29 Recommendation 1.61 Coalition Senators recommend that the roster changes provision be reworded to provide more clarity. Modern Awards Objectives 1.62 Coalition Senators were amazed at the specific wording of these provisions given the great fanfare and rhetoric from both the Prime Minister and Minister Shorten. 1.63 This amendment was not suggested by the Fair Work Review Panel. It was instead suggested by Mr Dave Oliver, the Secretary of the ACTU, in a speech on 6 February 2013 when he said: 'we’ll be asking the government to enshrine penalty rates for weekend work - in legislation, to protect it forever.'30 1.64 Coalition Senators do not believe that the Parliament should be in the business of legislating the details of each and every Modern Award, taking account of flexibility that may be required in particular sectors. However it is important that the Commission both in the current review and in future reviews take a common-sense approach. 1.65 These changes are summed up well by the Timber Merchants Association in their submission who say: The proposed change to the Fair Work Act 2009 will have no practical effect. Modern awards are already required to contain provisions requiring an employer to consult with employees about major changes that have significant impact on employees.31 1.66 Indeed, the Department has confirmed that this amendment will have no practical effect and will not guarantee penalty rates, as has been suggested by the Minister: Senator BACK: That's right! I will go to the question of penalty rates. Can you explain to me in practical terms what the impact of the change proposed in this amendment bill will be? Already, I understand, the Fair Work Commission take penalty rates into account, do they not, when determining modern awards?

29 Mr Richard Cairney, Director of Policy, Business SA, Proof Committee Hansard, 22 April 2013, p. 44. 30 Ewin Hannan, 'ACTU ramps up penalty rate row', The Australian, 6 February 2013. 31 Timber Merchants Association, Submission 3, p. 4.

35 Mr Kovacic: There is not an explicit obligation in terms of the modern awards objective for the Fair Work Commission to take into account the issue of whether there is a need for additional remuneration for people who are working unsociable hours, among other things. This makes it an explicit requirement. But, at the end of the day, the Fair Work Commission will retain the ability to determine whether or not the remuneration level in a modern award is appropriate, and the level that it should be based at based on the evidence that might be presented to it. Senator BACK: That is the case, isn't it—that, if the commission chooses to, it could decide not to have penalty rates in an award? That is the commission's function and right now. So that remains the case, even with this amendment in place, doesn't it? Mr Kovacic: That is correct. Indeed, there are some modern awards that operate at the moment that do not have any provisions around additional remuneration, whether it is for working weekends or night shifts, because it of the nature of work in that particular industry.32 1.67 Coalition Senators note the widespread concern that has been expressed by the real estate industry in relation to this provision. The real estate industry has long had differing arrangements around weekend work, noting that many house viewings and auctions take place over the weekend – something that has been supported both by employer and employee representatives before the Commission.33 1.68 Given these amendments will have no actual consequence and that the Commission will still be open to exercise the same level of discretion, Coalition Senators have no overwhelming issue with these provisions apart from that this kind of symbolism could have been achieved without taking up the Parliament’s time. 1.69 The National Farmers Federation also criticised the proposed addition to the Modern awards objective, observing that this amendment will entrench penalty rates – even in those industries that the Fair Work Commission has previous decided that penalty rates should not apply. The NFF observed that: The applicability of penalty rates should be considered in the context of the industry, it should not be a blanket objective for all industries, especially when certain industries operate predominantly during overtime, unsocial hours or weekends and the specified rates have already contemplated the nature of their work hours.34 … The NFF is of the view that the amendments fail to take into account the macroeconomic effect upon the economy. It is not an appropriate time to

32 Senator Chris Back, Senator for Western Australia and Mr John Kovacic, Deputy Secretary, Department of Education, Employment, and Workplace Relations, Department of Education, Employment and Workplace Relations, Proof Committee Hansard, 22 April 2013, p. 56. 33 See for example Real Estate Employers' Federation of NSW, Submission 28; Real Estate Institute of Australia, Submission 43. 34 National Farmers Federation, Submission 10, p. 16.

36 implement legislative action to entrench penalty and shift loadings into the cost of the labour market. We view the proposal as unbalanced and counterproductive to trade exposed businesses like farms, which have come under great competitive strain in recent years.35 Workplace Bullying 1.70 Coalition Senators take very seriously the issue of workplace bullying and noted with interest the House of Representatives Committee’s report into the issue. However, we are disappointed that the Government did not decide to deal with this issue in a separate Bill to ensure the necessary oversight. 1.71 Coalition Senators agree with statements at the last round of Senate Estimates by Safe Work Australia that workplace bullying is an occupational health and safety issue. We also note that despite the rhetoric from the Minister, when claims are finalised at the Commission, they will then be referred to state Occupational Health and Safety Regulators. That said, there is no detail as to how the Commission will interact with state regulators or how the Commission will recognise the Work Health and Safety Act or the Bullying Code of Practice that falls under it. Coalition Senators point to observations by the Law Institute of Victoria that: …the LIV questions whether the Fair Work Commission is the most appropriate forum in which to deal with workplace bullying disputes; How an order would be enforced in practice. It is uncertain whether the Bill vests jurisdiction in the Fair Work Commission or a Court to enforce the terms of the order…36 1.72 Almost every submission to the Senate Committee made substantiative comment on the bullying provisions contained within this Bill. Notably, concerns were expressed by employee and employer representatives as well as other interested parties particularly around specific wording and how these provisions will act in reality. For example, the Australian Nursing Federation (Victorian Branch) identified in their submission a number of issues where greater clarity would be of benefit, including:  Some description of some of the types of behaviours that would fall within the definition of bullying;  Development of guidance material to assist workers who believe they have been bullied; and  Clarity around whether or not a worker is required to attempt to use internal grievance procedures prior to making an application.37 1.73 The volunteer sector has identified a potential impact of these changes, as the following exchange indicates:

35 National Farmers Federation, Submission 10, p. 17. 36 The Law Institute of Victoria, Submission 12, p. 7. 37 Australian Nursing Federation (Victorian Branch), Submission 14.

37 Senator BACK: I do, Chairman. Thank you very much. In your submission, you made reference to the impact of the legislation on volunteers. Could you give us some further information there. For example, what might be the practical impact of this legislation as presented on a volunteer coach? Mr Barklamb: I thank you, Senator, for the question and for picking up on something we take seriously. There are no volunteers in our industry. We are almost exactly the opposite. We are at the highest end of the income distribution nationally. But all who appear before you are stewards of the system. We all have an interest in how our community works and that is the basis on which we have raised it. There is a statutory note to proposed section 789FC(2), which takes about the definition of a worker, including volunteers. To be honest, Senator, I do not completely know, but we make just a couple of points on this. This bill should not proceed and the committee, I do not believe, should proceed without hearing from the volunteer organisations of their concerns precisely around the coaches. I understand in the piece of legislation which is referred to, which is the Work Health and Safety Act, there is a distinction between volunteers working in volunteering organisations and in other areas, but I am not clear quite when that provides a protection and when it does not. Senator, there is an interesting case underway in America at the moment— and I do not at all condone this conduct—but there is actually a volunteer coach of a basketball team, who I was listening to the other day, who has been withdrawn for bullying his young charges in that particular case. Obviously, a number of people have experience of those things in their past when younger et cetera. The reason we raise this is that we think it is a matter of diligence for the senators and for the committee to understand and hear from the representatives as volunteers about their concerns and what this may raise.38 1.74 The Government has not responded to these concerns to date. 1.75 Importantly, this Bill also fails to deal with bullying that could take place in a workplace by a union boss, despite the long history of bullying and intimidation by some union bosses particularly in the building and construction sector. 1.76 There is a very long and clear history of bullying tactics by union officials towards both workers and their employers, most recently at the Grocon Myer Emporium site which saw union officials bashing police horses. This is unacceptable behaviour and all Australians should be free to go to work free of these kinds of thuggery and intimidation. Recommendation 1.77 Coalition Senators recommend that the definition of bullying be extended to include bullying by union officials towards both workers and employers.

38 Mr Scott Barklamb, Executive Director – Industry, Australian Mines and Metals Association, Proof Committee Hansard, 22 April 2013, p. 29.

38 1.78 Another area that the Government has, to date, failed to deal with is the additional resources that will be required to deal with these claims at the Fair Work Commission. Following the Café Vamp OHS prosecution in Victoria in 2010 the volume of claims of bullying from workers to WorkSafe Victoria rose to more than 6,000 complaints in a year – that in one state alone, one can only wonder what the implications would be on a national level.39 1.79 The Fair Work Commission has expressed concerns about taking on such a work-load without additional resourcing, saying at Senate Estimates that: Senator ABETZ: All right. Even if it was not conducted by the members of the tribunal, do you have sufficient administrative staff walking around during the day just waiting to be able to resolve bullying issues, or are they fully occupied? Ms O'Neill: They are fully occupied. Senator ABETZ: So the Fair Work Commission would be unable to deal with any extra workload howsoever arising from the bullying announcement without extra money? Ms O'Neill: I think that is right, Senator, but for this: I cannot comment on what capacity may or may not exist if the work was undertaken by members of the tribunal. I can certainly say that if the work was undertaken by members of staff there is not any capacity. I am just not in a position- Senator ABETZ: All right. Mr Ross, how many hours are spent on the golf course by your commissioners instead of sitting at the bench? Is there an extra capacity there in the bench to be able to deal with an extra workload? Mr Ross: It would depend on the nature of the functions, I think. But I know that we are under capacity at the moment rather than having too much capacity, and that is creating some issues.40 1.80 This is something that was also identified by the Community and Public Sector Union in its submission.41 1.81 While Coalition Senators would strongly encourage the Government to consider the deep concerns that have been expressed by interested parties such as the Law Council about the wording of these provisions including the definition of bullying, we are attracted to a proposal put forward in the Master Builders Association submission: Master Builders submits that there would be greater utility in having complaints first referred to an agency, such as the Fair Work Ombudsman (FWO), and for that agency to be empowered to bring any application once the case was clearly determined to be legitimate. This would prevent the

39 Rachel Wells, 'Most workplace bullying claims fall short', The Age, 24 July 2011. 40 Ms Bernadette O'Neill, General Manager, Fair Work Commission, appearing before the Senate Education, Employment and Workplace Relations Legislation Committee, Estimates Hansard, 13 February 2013, p. 27. 41 Community and Public Sector Union, Submission 17.

39 lodgement of an application relating to a bullying allegation being used as a device to foster “go away money” or obtain other leverage at work or, in the case of subcontractors, getting commercial leverage.42 1.82 Such a proposition would be consistent with the requirement under the model Work Health and Safety laws that only a government regulator can take a claim – something that was expressly supported by the former Workplace Relations Minister Julia Gillard. 1.83 Coalition Senators also see merit in having such arrangements to ensure that only meritorious claims with reasonable prospects of success proceed to the Fair Work Commission and stop any potential ‘go-away money’ from exchanging hands. The Fair Work Ombudsman is a well-placed and well respected agency that could do such work. Recommendation 1.84 Coalition Senators recommend that workers be encouraged to take all reasonable steps to resolve their concerns, such as by making a complaint to the Fair Work Ombudsman, before elevating the complaint to the Fair Work Commission. Compulsory Arbitration 1.85 All union submissions to this Committee make recommendations about the forced or compulsory arbitration in particular circumstances. This is something that Minister Shorten has told the media that he is considering by way of an amendment. 1.86 Coalition Senators support the comments of Mr Daniel Mammone of the Australian Chamber of Commerce and Industry at the hearing that: In fact, the panel rejected making a recommendation, as sought by the unions in their submissions to the panel, which would create an arbitration power for the Fair Work Commission to deal with such disputes. These proposals will be strongly opposed by the business community. The government clearly indicated in 2007 and 2008 that its fair work system would not contain new forms of compulsory arbitration. However, the act did ultimately include new forms of arbitration for low-paid bargaining and good faith bargaining in breach of these promises. On the specific proposal of arbitration for intractable disputes, the then Deputy Prime Minister and now Prime Minister, the Hon. Julia Gillard MP, on 29 April 2007 ruled this out in the following terms: 'And let me make this absolutely clear: there will be no compulsory last resort arbitration for collective agreements, as is desired by the ACTU, under Labor.' These types of proposals should be subject to a mandate in the 2013 federal election, as occurred in 2007.43

42 Master Builders Australia, Submission 4, p. 12. 43 Mr Daniel Mammone, Director of Workplace Policy and Director of Legal Affairs, Australian Chamber of Commerce and Industry, Proof Committee Hansard, 22 April 2013, p. 43.

40 1.87 Coalition Senators believe in the strongest terms that any change to reintroduce compulsory arbitration would be a breach of promise on the scale of the “No Carbon Tax” or “the best thing we can do for working families is bring in a surplus”. To reiterate what I’ve said previously, such a breach would also unleash a new level of legal uncertainty about the whole Fair Work Act as a whole. 1.88 Coalition Senators note that despite the widespread submissions from to the Fair Work Review from union bosses demanding wider arbitration, the Panel concluded that 'we are not inclined to recommend providing any additional avenues for arbitration'.44 Recommendation 1.89 Coalition Senators recommend that no amendments to this Bill nor the Fair Work Act be made to expand arbitration. Technical Amendments 1.90 The raft of technical amendments that this Bill makes is largely technical and grammatical. Coalition Senators note that a majority of these amendments come from oversights in the Fair Work Amendment Bill 2012. 1.91 Coalition Senators would encourage the Government to take more care when drafting and point to this as a result of what happens when legislation is rushed through the Parliament without proper oversight. We also note that this Bill was passed less than 48 hours after its introduction and the Senate Committee was significantly curtailed. Conclusion 1.92 While Coalition Senators recognise that there are both unscrupulous employers and employees, we support the observation by the Timber Merchants Association in their submission that: There appears to be an underlying assumption that the majority of businesses are in capable of managing employees in a manner that is beneficial to both the employee and the business. The majority of businesses operate in a fair and just manner.45 1.93 It is very clear that these amendments will not lead to greater jobs growth nor productivity – or for that matter, any additional protections for workers. All this Bill achieves is the ticking off of a wish-list for union bosses. Coalition Senators note that the Minister for Workplace Relations intends to introduce further amendments to the Fair Work Act in the winter sittings. Any significant government amendments should be subject to further committee consideration. 1.94 In the absence of significant amendments as recommended by this report and a Regulatory Impact Statement, the Bill should not be supported.

44 Final Report of the Fair Work Act Review, p. 148. 45 Timber Merchants Association, Submission 3, p. 1.

41 Recommendation 1.95 Coalition Senators recommend that the Bill be subject to significant amendment and a Regulatory Impact Statement.

Senator Chris Back Senator Bridget McKenzie Deputy Chair

APPENDIX 1 Submissions received

Submission Submitter Number

1 Baking Association of Australia

2 Frame and Truss Manufacturers Association of Australia

3 Timber Merchants Association

4 Master Builders Australia Ltd

5 Mr Eric Windholz, Monash Centre for Regulatory Studies

6 Australian Domestic and Family Violence Clearinghouse

7 Business SA

8 Australian Manufacturing Workers' Union

9 Work and Family Policy Roundtable Attachment 1 10 National Farmers Federation

11 Australian Public Transport Industrial Relations Association

12 Law Institute of Victoria

13 United Services Union

14 Australian Nursing Federation

15 Australian Nursing Federation

16 Chamber of Commerce and Industry Queensland Attachment 1 17 Community and Public Sector Union

18 Australian Meat Industry Council

19 Australian Mines and Metals Association Supplementary Submission 1

44

20 The Law Society of New South Wales

21 UnionsWA

22 National Retail Association

23 Victorian Employers' Chamber of Commerce and Industry

24 South Australian Wine Industry Association

25 Australian Council of Trade Unions

26 BHP Billiton

27 Shop, Distributive and Allied Employees Association

28 Real Estate Employers' Federation of NSW

29 Housing Industry Association

30 Department of Education, Employment and Workplace Relations

31 Australian Motor Industry Federation

32 Chamber of Commerce and Industry WA

33 Australian Federation of Employers and Industries

34 Anna Chapman, University of Melbourne

35 Redfern Legal Centre

36 Australian Industry Group Supplementary Submission 1 37 Northern Territory Government

38 Australian National Retailers Association

39 Textile Clothing and Footwear Union of Australia

40 Maritime Union of Australia

41 Qld Working Women's Service Inc

42 Civil Contractors Federation

43 Real Estate Institute of Australia

45

44 Master Electricians Australia and Electrical Contractors Association 45 Carers Victoria

46 Australian Business Industrial

47 Restaurant and Catering

48 Australian Chamber of Commerce and Industry Attachment 2 Attachment 3 Attachment 4 Supplementary Submission 1 49 Australian Human Rights Commission

50 Business Council of Australia

51 Meerkin and Apel Lawyers

52 Recruitment and Consulting Services Association

53 Accommodation Association of Australia

54 Job Watch Inc Attachment 1

Additional information received 1 Additional information provided by Department of Education, Employment and Workplace Relations on 22 August, 2013.

Answers to questions on notice 1 Response to questions on notice from Australian Council of Trade Unions received 2 May, 2013. 2 Response to questions on notice from Shop, Distributive and Allied Employees Association received 2 May, 2013. 3 Response to questions on notice from Australian Industry Group received 2 May, 2013.

APPENDIX 2 Witnesses who appeared before the committee

Melbourne, Monday, 22 April 2013.

BARKLAMB, Mr Scott Cameron, Executive Director, Industry, Australian Mines and Metals Association BRADFORD, Mr Douglas, Principal Consultant, Australian Mines and Metals Association BRYANT, Ms Therese Bryant, National Women's Officer, Shop, Distributive and Allied Employees Association CAIRNEY, Mr Richard (Rick), Director of Policy, SA Employers Chamber of Commerce and Industry Inc; Business SA CULLY, Mr Peter, Branch Manager, Industry Liaison Branch, Department of Education, Employment and Workplace Relations DAVIS, Ms Carolyn, Manager, Work Health, Safety and Worker's Compensation Policy, Australian Chamber of Commerce and Industry DOLEMAN, Mr Michael, Deputy National Secretary, Maritime Union of Australia FOX, Ms Julia Fox, National Industrial Officer and National OH&S Officer, Shop, Distributive and Allied Employees Association JACKA, Mr Adam, National Legal Officer, Maritime Union of Australia KOVACIC, Mr John, Deputy Secretary, Department of Education, Employment and Workplace Relations LYONS, Mr Tim, Assistant Secretary, Australian Council of Trade Unions MAMMONE, Mr Daniel, Director of Workplace Policy and Director of Legal Affairs, Australian Chamber of Commerce and Industry MATTHEWS, Ms Lisa, Senior Workplace Policy Adviser, Australian Mines and Metals Association MOREHEAD, Dr Alison, Group Manager, Workplace Relations Policy, Department of Education, Employment and Workplace Relations NEAL, Mr Aaron, National Legal Officer, Maritime Union of Australia O'SULLIVAN, Mr Jeremy, Chief Counsel, Workplace Relations Legal Policy, Department of Education, Employment and Workplace Relations SMITH, Mr Stephen Thomas, Director, National Workplace Relations, Australian Industry Group TKALCEVIC, Ms Belinda, Senior Industrial Officer, Australian Council of Trade Unions WILLOX, Mr Innes, Chief Executive, Australian Industry Group