Why Labor’s IR Bill will not deliver ‘Secure Jobs, Better Pay’

Federal Labor’s sweeping industrial relations law reform, the so-called “Secure Jobs, Better Pay Bill”, has passed into law after the government secured the last-minute support of the Greens and independent senator David Pocock. The Bill expands multi-employer bargaining, abolishes the ABCC, and has been promoted as “fixing the gender pay gap” by allowing for greater roster flexibility. It is supported by the ACTU and other union officials. A brief look at what the Bill aims to do seems like it might improve the woeful state of industrial relations law in this country, which is so strict that workers don’t even have the right to strike without permission from the government’s Fair Work Commission (FWC). A closer look at the Bill shows that each area of reform only creates new problems, or at best, papers over the fundamental limitations of a legalistic approach to industrial relations.

This article breaks down each of the changes implemented by this bill, and their impacts on working people across the country. We argue that these uneven and fragmented legislative changes simply continue the decades-long project of governments seeking to shift power away from the workplace and into stricter legal, electoral channels. These reforms, like any that are enacted from above, place the potential for industrial change in the hands of legislators, commissioners, lawyers and ultimately, bosses – not in the hands of workers themselves.

Fair Work Commission

As with all federal industrial relations law, a significant part of this Bill deals with the powers of the FWC. Besides handling individual employer-employee disputes, the commission acts as the arbiter of industry-wide pay and conditions in Australia. It sets the minimum wage, industry awards, and approves Enterprise Agreements (EAs) between unions and bosses. It also polices unions during EA disputes with bosses, as it holds the power to declare certain industrial actions illegal for whatever reason (ironically, this is usually because they are deemed ‘too disruptive’, i.e. effective).

Its commissioners are appointed by the government and usually come from an employer lobby group background. It therefore acts as the bosses’ mechanism for suppressing wages and draining union resources in protracted legal battles. Most recently in June it moved to increase the minimum wage to below inflation levels, pacifying discontent amongst low-paid workers while ensuring they would still receive a real pay cut.

Under Labor’s reforms, employers and unions will be compelled to attend a conciliation overseen by the FWC every time workers complete a Protected Action Ballot Order (PABO). A PABO is held every time a group of employees wants to take legally protected industrial action, meaning these conciliations would seek to forestall the bargaining carried out when workers strike or stop work, replacing it with a managed negotiation between bosses and bureaucrats. We know that the only real way to grow a union is through action, as workers prove their industrial strength to colleagues on picket lines and through demonstrations of solidarity. As the union movement continues to decline in membership and activity, such forms of negotiation and conciliation must be resisted if we are to reverse these downward trends and inspire greater worker confidence.

Multi-Employer Bargaining

The headline reform of this Bill is the proposal for multi-employer bargaining. This will allow unions that represent employees working in the same industry for different employers to undertake an EBA with all these employers at once.

Any opportunity for workers to take action for better pay and conditions as a larger group is welcome. All workers everywhere share the same fundamental interests and opposition to the interests of their bosses, so fighting for those interests together is essential. This opportunity is crucial for workers in large industries of many medium-sized employers, like early childhood education, and disability and aged care support. These worksites are often exclusively staffed by women workers – frequently of migrant backgrounds – providing services that are essential for women everywhere to express economic independence from the nuclear family.

Alongside the paltry and highly restricted changes to flexible roster rights, this is how Labor promoted their Bill as addressing a key election promise: “fixing the gender pay gap” and “raising the wages of disability and aged care workers.” But fiddling around the edges of industrial relations law will not change a gender pay gap that is as large as 33%, nor create free services for workers and their families. Early childhood education, school cleaning, aged care, and disability support should be in public hands and with equal pay. This can only be won with an industrial campaign by the workers themselves against the government and the bosses.

Further, this reform could feasibly work against workers in other industries. Unionised workers at the largest retail and fast food companies are under the sway of the right-wing Shop, Distributive and Allied Employees Association (SDA), a bosses’ union that signs up mass amounts of workers to woeful pay deals in order to gain votes within the Labor party for the Christian Right. Under multi-employer bargaining, it’s feasible for the SDA to use its current influence in the retail sector to extend its terrible pay deals to the industry as a whole. Furthermore, this Bill was only passed when Labor conceded to teal-adjacent independent David Pocock by increasing exemptions for small businesses from multi-employer bargaining. Businesses with fewer than 25 workers are completely exempt, while businesses of fewer than 50 may be exempt in certain conditions as well. Considering that employees of small businesses are usually the most exploited in this country (think hospitality staff, who regularly have their wages and super stolen), this reform is far from beneficial to most workers. Furthermore, due to the size of their workplaces, employees of small businesses are the kind of workers who would benefit most from multi-employer bargaining. Ten staff members at a cafe go on strike, it is easy for the boss to find ten scabs to undermine the industrial power of his staff. If cafe workers all across sydney downed their coffee cups, the hospitality barons of this city would have little recourse but to agree to their workers’ demands. Exempting small businesses from this important allowance severely undercuts the power of this reform.

Another significant exemption to multi-employer bargaining is the entire construction industry. There is no reason for this other than to placate construction businesses after abolishing the Australian Building and Construction Commission (ABCC, more on this below). With a weaker union-busting body in construction and the ability for the CFMMEU – Australia’s most militant union – to undertake bargaining across multiple employers in the construction sector, worker power in construction would have been greatly increased. The government and its developer mates must have feared a return to the sort of militancy shown by the Builders Labourers’ Federation, which won so many rights for workers in the 60s and 70s. It should be clear, though, that the militant sectoral bargaining of the NSWBLF was achieved not because of favourable laws or supportive union officials, but despite them. Their democratically organised ‘area committees’ led by rank-and-file workers were able to coordinate mass strikes and regular stop work meetings across various workplaces and employers in NSW, a structure hated and vigorously opposed by federal union leaders and bureaucrats. Only a similar bottom-up strategy would enable true ‘multi-employer bargaining’ to take place; the reforms of this Bill simply enable union leaders to speak over the voices of more workers at once during negotiations.

Finally, there are more restrictions in the fine print of this Bill that show multi-employer bargaining reform to be nothing more than window dressing. Multi-employer bargaining is only allowed when a majority of workers at all sites agree to it, leaving sites lacking in union density isolated from their more mobilised counterparts in the same industry. There can also be no current EAs in place (unlikely for places with a decent level of union density) across any of the prospective sites, and each employer is required to give some form of consent. These ridiculously cumbersome bureaucratic requirements make this reform effectively useless, as it was intended to be all along. President of the Australian Council of Trade Unions (ACTU) and one of the Bill’s key proponents, Sally McManus, conceded that the reality of multi-employer bargaining was “ridiculous,” and that it was only meant as a threat to scare employers into come to the bargaining table with their employees.

With these exemptions and restrictions, it is clear that this Bill’s only meaningful reform for workers is simply a bait-and-switch. It gives a (false) glimmer of hope for wage growth to workers in some industries, while leaving powerless the ones who would benefit from it most.

The ABCC is gone – but what’s next?

As mentioned, the federal government is supposedly fulfilling its promise to the CFMMEU by scrapping the ABCC. The ABCC was set up as a specialised watchdog to bring ‘order’ to the unruly construction industry; in real terms, it was an attack dog deployed to bring the construction division of the CFMMEU to heel. It did not just pursue the union itself, but also individual union members and union staff, targeting them with absurd fines and restrictions, using its special powers to dig up minor and obscure breaches of industrial laws.

For instance, there is the case brought against a union organiser for calling a site manager a “cunt” while attempting to exercise his right of entry to the site, and the commission’s ban on safety posters with the union’s logo. To be clear, we believe unionists have the right to do a lot worse than call managers cunts. The ABCC had the mission of stamping out ‘union coercion’ of employers, but the problem is not that the unions are too coercive, it’s their lack of any coercive capacity at all. Indeed, the introduction of the ABCC and the subsequent restrictions on union activity had horrendous consequences. Workplace fatalities jumped from 3 deaths per 100,000 workers to 5 per 100,000 after Howard introduced the commission.

When we look at who is replacing the ABCC’s jurisdiction, it is clear that the only part of the ABCC being abolished is the name. Existing ABCC cases will now become the responsibility of the Fair Work Ombudsman, who will have all the same powers, including the ability to form a special unit targeting the construction industry. Cases before the commission were generally prosecuted under broader legislation anyway, as in the ‘cunt’ case, which is being prosecuted under the 2009 Fair Work Act, introduced by Kevin Rudd’s Labor government. The problem was not the ABCC, but the use of legal restrictions to reign in militant unions and unionists, a tactic which will persist in the commission’s absence.

In place of the ABCC, the government is giving more teeth to their proposed National Construction Industry Forum. The forum is a ‘tripartite’ body, meaning it’s based on cooperation between employers, the government, and unions. If the past hundred years of class collaborationism has taught us anything it is that whenever employers, the government and unions sit down to cooperate, it is the working class that loses out. Though some might be attracted to the idea of a greater ‘voice’ for the unions in policymaking, this ‘voice’ serves the sole purpose of drawing unions away from direct action, defanging them.

The Better Off Overall Test (BOOT)

The BOOT refers to the requirement that the Fair Work Commission has to be satisfied that an agreement is better off overall than an industry’s existing awards or the minimum wages and conditions. The reforms to the BOOT have been recognised as “good news for employers,” and are some of the most worrying features of this Bill.

The previous BOOT provided that the FWC could only approve an agreement if it was satisfied that all employees, including prospective award-covered employees – that is, future employees – would be better off overall. Now, the FWC may only make decisions with regard to employees or types of work who are “reasonably foreseeable at the test time,” effectively barring them from considering how future employees will be affected by an enterprise agreement. In practice, this would allow a workplace which currently did not hire any casual or weekend workers to negotiate an agreement without casual loading or penalty rates. The FWC would be barred from assessing how future casual or weekend workers would be affected by that agreement – but there would be nothing to stop that workplace from hiring casual or weekend workers after the agreement was approved.

The apparent protection against this loophole is that employees may make an application for the FWC’s reconsideration of the agreement if they are engaged in a type of employment which the FWC could not previously consider. However, employees should not have to spend thousands of dollars and months of their time re-litigating their conditions – this so-called ‘protection’ is an expensive fix to a needless and anti-worker amendment.

This reform is likely a direct response to the Retail and Fast Food Workers’ Union (RAFFWU) using the BOOT to recover billions of stolen wages from employers at McDonald’s, Domino’s, KFC, Coles, Woolworths, and more. It is now entirely possible to undercut these wins by grandparenting worker conditions.

A Sectionalist Reform

When considering all these changes, Labor’s new Bill is clearly not the fix for wages and the gender pay gap that it has been promoted as. While it gives workers in larger industries the ability to carry out bigger strikes (if they jump through a convoluted series of bureaucratic and financial hoops and their union leaders and employers allow them to), it leaves the vast majority of workers in smaller industries to wallow in their already ruthlessly low wages. Small and practically irrelevant tweaks to some workers’ rostering rights are promoted by the Greens and Labor as game-changing amendments, as if to make up for the fact that this reform makes the conservative FWC more powerful. Even one of the Bill’s headline reforms, the abolition of the much-maligned ABCC, is simply a rebrand: a new union watchdog will be introduced to help restrain the more militant actions of construction workers, while workplace injuries and deaths in construction continue.

Despite support from union officials and the Greens, this Bill is clearly a bill for the bosses. At best, it gives sections of workers a few small and ultimately insignificant improvements to their ability to win in our broken industrial relations system, while undercutting the rights of others. It is a bait-and-switch designed to convince workers that this government will act in their interests, while keeping the business lobby happy. The Greens should have maintained their opposition to this Bill which is fundamentally a blow to workers, instead of being drawn in to play cheerleader for Albanese. If anything, the passage of this Bill further strengthens our argument that illegal strike action – not the election of false allies to parliament – is essential to smashing Australia’s repressive industrial relations laws. At the end of the day, our power as workers will always lie in our ability to cripple the economy that we keep running, not in legislation or commissions.