The current industrial relations landscape weighs too heavily in favour of workers at the expense of employers, and the effect is a reluctance to take on extra employees, a Reserve Bank (RBA) director has said.
“We’ve got to get a better balance than we have at the present time, like flexibility in the labour force, and we’ve got to create a situation where there’s a real payback for investment that produces greater efficiency and therefore greater productivity,” Roger Corbett, RBA director and former Woolworths CEO, told the ABC's Lateline program.
Corbett commented that while the rights of workers must be upheld, employers also need to be able to take on workers under more flexible terms. “If (employers) feel that they're moving into a situation that they then can't get out of…there will be a reluctance to employ people … I think that's where we are.”
An independent review of the Fair Work Act is currently underway and was initially welcomed by industry stakeholders. However after the announcement that the review will be conducted in a series of private hearings it has since been slammed by the coalition. Opposition workplace relations spokesman Eric Abetz accused Workplace Relations Minister Bill Shorten of hiding the legislation and submissions from public scrutiny and accountability. “It’s clear that Mr Shorten is doing whatever he can to hide Ms Gillard's legislative baby, the Fair Work Act, from any scrutiny or accountability,” he said in a statement.
A spokesperson from the office of workplace relations said because the review was independent, decisions on how it ran the inquiry were a matter for the panel rather than the government. The review panel, which consists of an economist, a former federal court judge and an IR expert, received public submissions from a range of industry stakeholders and will report its findings to the government by 31 May.
Australian Industry Group chief executive Heather Ridout said employers will be looking for tangible outcomes which will further support the competitiveness of businesses given the volatile economic times.
“The test of the review will be the extent to which its outcomes support increased productivity and flexibility, reduce red tape and improve competitiveness,” Ridout said.
Former Howard government workplace relations minister Peter Reith was sceptical on whether much would come from the review. “The bottom line is that, as Bill Shorten says, he’s basically happy with the Fair Work Act,” he told ABC Radio.
In a recent statement, Shorten assured that the review will be an opportunity to have an evidence-based discussion about the operation of the legislation, the extent to which its effects have been consistent with the objectives, and where the legislation’s operation can be improved.