Tuesday, 7 August 2012

Fair Work Act review has little value

We know why the Government sought a review of the Fair Work Act; they had no choice.

There should have been a proper assessment of the original legislation but that would have been too embarrassing, in the same way there was no proper assessment of the National Broadband Network.

So the Government was forced to have a later review of FWA. The Government ensured that it got the result it wanted by manipulating the terms of reference, by ensuring that the panel would be sympathetic and by supplying departmental bureaucrats to 'help' write the report.

In fairness to the Government this sort of behaviour is not new; many politicians have subscribed to the concept that you should never set up a committee unless you know the answer. But Workplace Relations Minister Bill Shorten forgot that the accompanying rule is to be a bit subtle about it, e.g. by appointing an opponent. The outcome has been the most one-sided report in living memory.

Of course, the reality is that whatever is in the report, the Government's formal response will be to continue to provide special arrangements to prop up the labour movement. The labour movement is steadily losing members. In the private sector, despite massive pro-union support from the Government and the Greens, rank and file workers are deserting the union movement.

The percentage of private sector workers is now down to 13.2 per cent. It will fall lower; not just because of corruption in the HSU and in the AWU but because union bosses can no longer serve the aspirations of workers. The remaining pockets of union membership will be in the public sector and in those parts of the private sector, e.g. resources, offshore and building/construction where the unions can use their monopoly position to increase the incomes of highly paid workers. These are not downtrodden workers; they are workers earning hundreds of thousands of dollars and who will ultimately deprive Australia of the investments we need in these sectors.

Shorten is a former union boss and he knows where his bread is buttered. He has shown no capacity to assess the public interest. All he knows is how to toe the line as demonstrated in a recent interview when he was asked if he agreed with a comment by the PM. He said he did. He was then asked what the PM had said. He replied he didn't know. The TV presenter was incredulous and Shorten then explained that he always agrees with the PM regardless of what she says.

Not surprisingly, and to Australia's embarrassment, the video clip went viral. He is not the only second rate performer in the Cabinet. Anthony Albanese spoke for the Government to mark the New Year and drew his inspiration for Australia's future from a US TV drama series, the Trade Minister made a goose of himself as a singer and this week we find that instead of seeking inspiration from a hefty tome on political history or economics, we find that the Treasurer thinks that all he needs to know to run the economy is to play a song from Bruce Springsteen. If it wasn't serious, it'd be just a laugh but these are the people running our country.

The problem is that the system desperately needs reform but the only reform from Labor that is possible would be even more concessions to the unions. Any Coalition reforms, as described by Nationals Leader Warren Truss last Sunday, would be minimal. Even though the Coalition has not outlined any policy to date it seems unlikely that the Coalition will move to abolish or materially change Labor's 140 pro-union measures detailed by Innes Willox, CEO of AIG. Many of these are significant and should be tackled especially as the Coalition has already refused to contemplate individual agreements which are fundamental to real reform.

One of the alleged reforms introduced by Labor in the Fair Work Act was the concept of 'good faith bargaining'. I never had any doubt that it was always just another means to buttress the position of unions so that they can tilt the whole system in favour of union bosses.

The 'good faith bargaining' provisions have been a favourite slogan for the unions. Now that the Act has been in operation for a period time the provision has now been put under scrutiny in a case before The Honourable Geoffrey Flick in the Federal Court in a matter between Endeavour Coal and the Association of Professional Engineers, Scientists and Managers.

The term 'bargaining' is not defined by the statute so Judge Flick turned to the ordinary and natural meaning of the word and looked at definitions in various dictionaries. He then said "Illustrative of the process of 'bargaining' or 'haggling' is the exchange between Brian and the street merchant in Monty Python's Life of Brian" (P16 Endeavour Coal Pty Limited v APESMA [2012] FCA 764)

This was an excellent description of the legislation brought in by Julia Gillard. Poor Brian he was trying to escape the Romans and ducked into a shop with the pretence to buy something for his wife. He was told the price was 20 shekels but the merchant wanted to haggle even though Brian had proffered his asking price. The merchant then demanded that Brian bargain in good faith according to the requirements of the bazaar.

'Good faith bargaining' was a ploy introduced at the demand of the ACTU. It is another of the many flaws in Labor's FWA that needs to be repealed.

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