Don’t bury IR as an election issue just yet

by 19 Aug 2010

With only three days to go until the federal election, Joydeep Hor looks at what an elected Abbott government might mean for HR

Between Work Choices and the Fair Work Act, legislative change has had a remarkable impact on the day-to-day operational discharge of the HR function in Australian workplaces.

I know this by the relief I detect in my clients’ collective voices at the prospect of a period of stability, with Mr Abbott committing early on in the election campaign that a first-term Coalition Government would not change the IR laws.

With the greatest respect to both Party leaders, the current IR laws are not and should not be a dead issue. Furthermore, I do not think that “to Work Choice or not to Work Choice” is the question that should frame the debate.

As a legal and strategic adviser to business, and one who works closely with the senior human resources personnel in some of the country’s biggest organisations, it was clear to me that the Work Choices legislation necessitated in around 2006 and 2007 a significant amount of work to ensure compliance. Specifically, organisations needed to review their contracts of employment and related documentation (such as policies and procedures and HR manuals) to ensure that those documents were compliant with, among other things, the newly introduced Australian Fair Pay and Conditions Standard (AFPCS). Furthermore, organisations needed to grapple with the effective abolition of the state systems of industrial relations as part of the Work Choices regime.

Subsequent to that, and largely due to a highly emotive campaign that was targeted at Australian Workplace Agreements (AWAs) (which were of course introduced into Australian legislation nearly a decade before Work Choices) and the restricted access to unfair dismissal remedies for Australian employees under Work Choices, the ALP was successful at the last election. The Fair Work Act 2009 (Cth), while abolishing AWA’s, broadening access to unfair dismissal, introducing good faith bargaining obligations and modernising the Australian award system kept much of the structural framework of the national system of Work Choices. Importantly for HR managers, the AFPCS was expanded to 10 National Employment Standards (NES). Yet again, employment documentation such as contracts, policies and procedures all needed to be reviewed.

It is entirely unsurprising that those charged with the responsibility of ensuring employment law compliance within organisations crave a period of stability. It is fair to assume that regardless of the outcome of the upcoming election, at least as far as contract administration is concerned, HR professionals can breathe a sigh of relief. An elected Abbott government is highly unlikely to make adjustments to the new safety net of modern awards and the NES. Furthermore, given the stigma that is attached even to the mere utterance of the phrase Work Choices and even more so AWAs, it can almost be guaranteed that there will be no reintroduction of AWAs (by whatever name).

But the current system is far from perfect. I cannot recall a period in Australia’s history of enterprise bargaining where there has been so much rejection of collective agreements that were overwhelmingly approved by both employers and unions. Nor has good faith bargaining really done much to bring about more efficient agreement-making or heralded landmark agreements that take workplace productivity to new heights.

A solid IR framework must equally balance the rights of employees with the needs of employers and their stakeholders. It must strive to create efficiency in the labour market and also simplify the tenets of the employment relationship. An obsession with doing things right often detracts from the right thing being done and there must be a return to substance over form.

Let’s hope that fear doesn’t hold anyone back from doing the right thing with our IR laws.

Joydeep Hor is the managing principal People & Culture Strategies and a member of HR Leader’s editorial board.