The release of the Productivity Commission's draft report on Australia's workplace relations framework on Wednesday saw Tony Abbott backpedalling to counter suggestions changes might be afoot. "I want to absolutely stress that this is a draft report", the Prime Minister said. Workplace Relations Minister Eric Abetz leaned on the brakes too, saying it was a "report to government, not of, or from government". Their reticence to talk wholesale changes (in this term of parliament at least) is understandable given the Howard government's demise in 2007 has frequently been attributed to its unpopular Workplace Relations Act amendments.
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Union reaction was likewise predictable; ACTU secretary Dave Oliver suggesting that plans to allow small and medium-sized business operators the freedom to offer statutory enterprise contracts to new employees independent of Fair Work Commission scrutiny and on a take-it-or-leave-it basis would lead to reduced pay and conditions. There have been rumblings too about another PC recommendation to reduce Sunday penalty rates for workers in the hospitality, retail, entertainment, restaurant and cafe sectors by up to 75 per cent.
Despite the ritualistic rejoinders, the draft report is a sober assessment of the IR landscape with recommendations for change that are for the most restrained and equitable. It rebuts the oft-heard employer lament about insufficient "flexibility" in the workplace relations system, suggesting the "different variants of WR systems over the past 20 years have had no detectable effect on measured economy-wide productivity". But it suggests the present system is complex enough to confuse people and that there are "unquestionable inefficiencies, remnant unfairness, some mischief, and absurd anachronisms".
Though they don't label Sunday penalty rates an anachronism, the report's authors believe that with the growing demand for weekend services, the reduction in religious observance and changing social norms about shopping times, modernisation may be beneficial to the hospitality and retail industries. And they suggest that bringing Sunday rates into line with Saturday rates would bring "positive outcomes" for people currently working in those industries. Some unions covering these sectors have already accepted the need to adapt to changed labour market circumstances. Others ought to accept that premise more generally given the report recommends other measures to shore up workers' rights and conditions, such as discouraging sham contracting, and giving the Fair Work Ombudsman more resources to monitor employers who hire temporary and permanent migrant workers.
It's doubtful that unions will welcome recommendations to restrict their right of workplace entry, to increase the maximum ceiling of penalties for unlawful industrial action, and to give the Fair Work Commission power to suspend or terminate industrial action where is "causing, or threatening to cause, significant economic harm to the employer". The imminent findings of the Royal Commission into Trade Union Governance and Corruption may render such indignation moot, however.
Despite Senator Abetz's attempts to distance the Coalition from the PC report, there is little doubt conservatives pine for reform. This might be why the report has been damned with faint praise in those quarters. But for Mr Abbott, who well knows the electorate's preference for incremental rather than sweeping IR change, this report may be about right.
