What Labor’s industrial relations reforms means for workers?

Labor is set to make the most significant industrial relations reforms in more than a decade after striking a deal with Senate crossbencher David Pocock to secure his support for its Secure Jobs, Better Pay Bill to pass parliament this week.

Why does Labor want this?

Labor went to the federal election with a promise to “get wages moving again”. The government says its IR laws will do just that, by making it easier for employers and workers to negotiate conditions – although employer groups strongly disagree. Workplace Relations Minister Tony Burke has said the laws will put immediate upward pressure on wages by incentivising businesses to negotiate new enterprise agreements with staff. The legislation also includes other election commitments, including making gender equality and job security objectives of the Fair Work Act and abolishing the Australian Building and Construction Commission.

Why are businesses concerned?

Employer groups and the Coalition have been strongly opposed to most of the provisions in the Bill, warning that the reforms – particularly the expansion of multi-employer bargaining – will do little to increase productivity and be detrimental to smaller businesses who could be forced to adopt workplace arrangements they didn’t negotiate. Labor has accused the business lobby of waging a “scare campaign” on behalf of employers who don’t want to have to pay higher wages.

Why are the laws controversial?

The most contentious element of Labor’s legislation has been multi-employer bargaining. This is essentially a way for workers at different companies who aren’t already covered by enterprise agreements to band together to call for better pay and conditions, as long as the Fair Work Commission determines they have a common interest. Labor has agreed to raise the threshold for small businesses that are excluded from the “single interest” multi-employer bargaining stream from one that employs 15 people to one that employs 20. The Bill also outlines a “supported” multi-employer bargaining stream, which is theoretically for the low-paid.

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