The first quarter of 2017 has seen an unusual amount of drama in the world of industrial relations. Here we roundup the latest battles, both political and legal, that are currently being waged.
Penalty rate cuts
The Fair Work Commission’s decision to cut the penalty rates has quickly, and perhaps predictably, become contentious. The Labor party and unions have tried to frame the issue as being about businesses against employees, big money versus little Aussie battlers. The competing narrative, belatedly supported by the Coalition government, is of struggling small businesses who need the cuts to stay open on Sundays and hire more staff.
The former argument appears to be winning, at least in the short term. On Thursday the Labor party was able to pass a bill blocking the cuts in the Senate thanks to the decision of crossbenchers to switch sides on the issue. Mounting public pressure was the catalyst. That Derryn Hinch – who took a strident stand, and One Nation leader Pauline Hanson, who called for penalty rates to be scrapped altogether – have both capitulated is evidence of how potent the campaign against the cuts has become.
The bill is still highly unlikely to pass in the lower house, where the Coalition has a slim majority.
Raising the minimum wage
Minimum-wage earners and the people who employ them have the most at stake in the penalty rate fight, so it’s not surprising that similar lines are being drawn around recommendations to the Fair Work Commission for a minimum wage increase.
The ACTU is insisting on a 6.7 per cent hike (which would lift it by $45 a week), the Australian Industry group is preaching caution and says a 1.5 per cent increase is enough, while the Australian Retailer’s Association wants an even lower 1.2 per cent rise. Last year saw the minimum wage increase by 2.4 per cent.
The two fights are linked because if the penalty rate cuts are instituted, the argument for a higher minimum wage will probably be perceived as stronger, and the battle over it will definitely become nastier.
With many organisations in hospitality, fast food and retail having already negotiated above-award rates for employees these debates will not affect everybody. For HR, as noted in our first article about the cuts, the important thing is to communicate with concerned staff about what they need to know and what any changes might mean for them.
Fair Work raids businesses suspected of underpaying youth workers
Speaking of minimum-wage earners, the Sydney Morning Herald’s expose about underpaid and unpaid young workers continues to make waves as the Fair Work Ombudsman responds to calls for action.
Last week Fair Work inspectors made unannounced visits to more than 80 businesses in NSW.
The Fair Work inspectors also raided several businesses located in the Wollongong CBD, interviewing business operators and workers and checking records to ensure workers were being paid minimum hourly pay rates, penalty rates, overtime and allowances. The businesses’ compliance with record-keeping and pay slip laws was also checked.
SMH’s report exposed, through interviews with Wollongong university students, a widespread culture of underpayment by cafes, restaurants, retail and take-away food outlets in the city. There were also cases of non-payment, such as a job try-out that could last weeks.
The many students profiled have been caught in what the reporters describe as “Australia’s burgeoning world of underpayment – where lip service is paid to industrial laws that are strict on paper, but loosely enforced.”
This case comes off the back of another report which uncovered rampant underpayment of 7-Eleven and Caltex employees, adding to mounting evidence that the practice spreads nationally through the hospitality and retail sectors.
New report: Workers comp claims continue to decline
A new report from Safe Work Australia has found that serious workers’ compensation claims continue to fall year-on-year across industries.
The annual report has published these key findings:
- The rate of serious claims has fallen by 33 per cent between 2000-01 and 2013-14
- The median time lost from work rose by 33 per cent to 5.6 working weeks between 2000-01 and 2013-14
- Labourers had the highest rate of workers’ compensation claims in 2014-15;
- And the health care and social assistance industry had the highest number of claims in 2014-15
You can read the full Australian Workers’ Compensation Statistics 2014-15 report here.
Great summation of the key IR issues for 2017. Concise and hits the key issues. However, important to highlight and delineate between the role and purpose of the national minimum wage (and annual associated adjustments) to the issue of penalty rates. While some parties and stakeholders may see them as interrelated (and they are), they should rightfully stand on their own.
Great to see IR issues recognised more boldly in the HR space.
PS. Error/typo found: ‘above-reward rates’ should read ‘above-award rates’ (in section on ‘Raising the Minimum Wage’)
I agree with Elizabeth about AHRI focussing more on IR issues. I would also like to see more commentary about the Unions, and what is going on in the Fair Work Commission. There was many issues revealed at the Heydon Royal Commission, which highlighted the grubby behaviour of the unions. This received nowhere near enough coverage or commentary from AHRI. There were also issues revealed which have significant ramifications in certain areas and for which 99.9% of people, including most HR people, have little knowledge. I am referring to issues such as superannuation legislation, industry super funds and their links… Read more »
Missed a major one…. reintroduction of the ABCC and new Building Code legislation. The implementation implications of this will impact on HR teams within the construction and maintenance industry a great deal