They have written to the Attorney-General detailing their ferocious objections to giving priority and preference to union agreements over non-union agreements, arguing this would reward higher levels of union militancy, disputation and anti-competitive conduct and is counter to freedom of association principles.
This will put the onus on ACTU secretary Sally McManus to decide whether her ambition to give priority to union agreements should also be a deal-breaker for a union movement that has finally developed a somewhat better relationship with the Morrison government.
Employer groups and major unions all agree the virtual collapse of enterprise bargaining in recent years is in no one’s interests and makes Australia’s industrial relations system even more dependent on an excessively complex award structure. They also agree change will require greater flexibility in the “better off overall test” (BOOT) rather than sticking with a highly technical interpretation that means every single worker must be better off, even in theory.
This leads to major difficulties and delays, sometimes for months, leading to a huge drop in agreements over the last several years.
But the BCA’s willingness to entertain splitting union and non-union agreements into two streams to facilitate a deal was overwhelmed by the vehement opposition of the Australian Industry Group, the Australian Chamber of Commerce and Industry, the Australian Mines and Metals Association and the Master Builders of Australia.
This led to an explosive fight between employer groups and the BCA during an online meeting last Tuesday, shocking union representatives and the minister who were also in attendance.
According to the opponents’ September 17 letter to Mr Porter, both union and non-union agreements must be accorded the same priority with all getting a new two-week deadline for approval by the Fair Work Commission – assuming agreements satisfy required standards and are supported by a clear majority of the workforce.
“We believe that the [BCA/ACTU] proposal will do nothing for well over a million Australians seeking work as we enter possibly the worst recession in our nation’s history, nor equip Australia for a successful post-COVID recovery,” the letter said.
The ACTU believes the application of minimum national standards does not offer sufficient protection in non-union agreements and these should include some of the additional safeguards guaranteed by the BOOT.
This demand is also likely to be rejected by the four employer groups who insist all agreements should be subject to the same approval processes whether or not unions are involved.
But one employer carrot on offer to the ACTU is that non-registered employee bargaining representatives would need to be nominated by at least 5 per cent of the workforce . This would stop big unions like the “shoppies” being upstaged by a small renegade group blocking an agreement – as occurred with Coles in 2016. This has compounded the decline in enterprise agreements.
Mr Porter is under great pressure to show progress in reforming an industrial relations system now even more rigid than it was decades ago when Paul Keating introduced enterprise bargaining to benefit the economy, and employers and employees alike.
The need to now reconcile the bitter dispute among employers in such an important area while smoothing over the typical stand-offs between employer groups and unions makes his task even more difficult.
The chief executives of the four employer groups initially said they would no longer have anything to do with the BCA, although its CEO Jennifer Westacott is still expected to attend further joint meetings with the unions and Mr Porter. But some of her own members also strongly disagree with her backing the ACTU.
Steve Knott, chief executive of AMMA, said the proposal did not enjoy the support of the broader employer community and contrasted the extensive industrial relations expertise of the four opposing groups with that of the BCA.
“The Group of 4 have staff who are employment lawyers, industrial relations experts and routinely appear before the bodies like the Fair Work Commission and other employee relations bodies,” he said.
As the impact of COVID-19 became clear last May, Prime Minister Scott Morrison announced five working groups to look at reform of enterprise bargaining, award simplification, casual employment, compliance and greenfields projects.
Changes to award simplification are likely to be limited to creating new “schedules” for small businesses for two years to allow employers greater flexibility on rosters and duties than the award system permits. But there is still disagreement on the level of union access to employee records, while bigger businesses will receive little relief.
The working group on casual employment has agreed casuals have the right to be made permanent after nine months. But employers want casuals who do not take this option to then wait another nine months unless the employer agrees to the switch earlier.
The unions will receive greater satisfaction from the compliance stream given the government had already committed to tougher penalties for “wage theft” even if the underpayment was not intentional.
The working group on greenfields projects held the last formal meeting on Friday but cannot agree on matching the duration of enterprise agreements with the construction timeframe for a major project.
This construction can often extend beyond the normal four years of an agreement, leaving a business vulnerable to strike action and unable to lock in costs. Despite federal Labor’s commitment to change this at the last election, the key rival unions, the AWU and the CFMEU, are opposed, leaving any legislation to negotiations in the Senate next year.
The impasse means employer groups will maintain unrealistic demands for eight-year agreements and a threshold of $250 million for a major project rather than conceding now and risking further concessions as part of horse trading with the Senate.