No hurry for Labor’s IR changes

by 11 Dec 2007

DESPITE MUCH media hype, there will be no immediate and significant changes to industrial relations under the new Labor Government, according to a number of legal experts.

HR professionals and their organisations will have ample time to adjust to changes under Labor’s transitional period, which provides employers with a realistic and measured timeframe.

“Labor has not proposed a rushed transition as occurred with WorkChoices,” said Jamie Robinson, a partner with Harmers Workplace Lawyers.

“The current policy documents suggest a reasonably balanced approach and also a sensible implementation timetable during which all parties will have an opportunity to make submissions in relation to the new proposed legislation.”

Tim Capelin, managing partner of Australian Business Lawyers, said some employers may be very concerned, but he suspected most should not be overly concerned.

“Those that are more concerned may be used to using AWAs to set conditions for their employees or are businesses with 100 or less employees who may not wish to be bound by the unfair dismissal laws,” he said.

“All will probably be concerned simply due to the costs of complying with further major changes in this area of law.”

There may also be a heightened awareness of employee rights that may lead to more claims. Similarly, Capelin said unions may become more active in the new environment.

Robinson noted that the change of Government will clearly mean a rebalancing of workplace relations, however, the major changes are not scheduled to occur until 1 January 2010.

The only substantive things that are scheduled to occur before then are: Award rationalisation (which was to occur under the former Howard government anyway), the beginning of the wind back of AWAs and the implementation of the 10 new national employment standards, he said.

“On a practical level however, employers will need to make sure that they are compliant with the existing system given that Labor will now potentially have significant influence over various government regulatory departments,” Robinson said.

While AWAs have attracted much media attention and will need to be carefully managed through the proposed transition (as there are a number of potential traps with the transitional arrangements), Robinson said they realistically only affect about 5 per cent of Australia’s workforce.

Capelin said that while companies are yet to see the detail of the new laws, they appear unlikely to be a radical departure from the post-fairness test WorkChoices laws. “However, there will still be a significant cost to updating contracts, policies etc to ensure they comply with the new laws,” he said.

The award rationalisation process will most likely have the biggest impact on employers and employees, according to Robinson.

“Employers will need to carefully manage that process as those awards will become the ‘baseline’ against which future collective agreements will be assessed,” he said.

“Employers which fail to actively be involved in the process will miss a significant opportunity for their organisation.”

In the short-term, Robinson said the most important point for employers was to re-claim communication with their workforce, which for some has been hijacked by the political process over the past three years.

“It is a time for solid information flow from employers, relationship building and gentle steadying of workforces by clarifying that significant changes will not occur for up to two years,” he said.

Unless companies use AWAs, or employers with 100 or less employees want to dismiss a problematic employee before the laws change, Capelin said there is not a lot to do in the short-term.

“If companies use fairness test compliant AWAs and they want to keep using them for up to the next five years, they should renew them very soon,” he said.

Otherwise, companies should also think about which of the industrial instruments (that are currently available and which will remain available) will be most suitable for the business or each part of their business, Capelin said.

“Award-reliant employers may wish to introduce a collective agreement that locks in current award conditions to give some certainty after the award rationalisation process occurs,”he said.

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