Advancing Australia fair: the Australian Fair Pay and Conditions Standard

Few could seriously claim that Australians are not toiling with 'hearts and hands'. Per capita hours worked by Australians are now amongst the highest in the GECD and there is evidence that work has intensified for most (see Watson et aI, 2003). There are high levels of temporal, numerical and functional flexibility and corporate profits are booming (ABS, Catalogue 5676.0, 2005). It is, therefore, unsurprising that the Howard Government's WorkChoices industrial relations reforms have been greeted with widespread antipathy by all but fractions within the business community (Lewis, 2005). The efforts of the, Howard government to prove an impetus for these reforms seems unlikely to accord with the actual working experiences of Australians, many of whom have already traded away conditions and provided employers with considerable flexibility under previous bargaining rounds or individual contracts or through the award simplification process. The $50m. saturation advertising campaign, designed to selI the reforms to the electorate, has had little impact on public sentiment (Humphries, 2005), Nonetheless, the Coalition's slim majority in the Senate means that WorkChoices is likely to proceed into law with few concessions. In recent years the Senate has proved to be a significant check on the Coalition's more ambitious industrial relations plans, with just 15 out of 56 introduced bills passing into law between 1997 and 2004. The Coalition's remarkable victory in the October 2004 election though has secured a majority in both houses (the first time since 1981, [Singleton, 1996:2]) and the Howard Government now claims a mandate to implement wide ranging reforms to industrial relations not seen since the introduction of decentralised wage determination in 1991. Among its other reforms, the Howard Government proposes to replace the 'no disadvantage test' with a new standard against which collective agreements and individual contracts are to be measured, known as the Australian Fair Pay and Conditions Standard (AFPCS). This new standard and its likely impact in Australian Industrial Relations is the subject of this article. We begin our analysis of the AFPCS by placing its introduction in the historical context of the gradual weakening of protective regulation since decentralised bargaining was introduced. Our argument is that the AFPCS is the latest reduction in the steady decline over the last thirteen years of regulation formerly designed to protect wages and conditions from falling. Labor and Coalition governments have both contributed to the dilution of this regulation, although its declining force has been most marked under the Howard government. We contend that, although the steady decline of this regulation has been claimed to stimulate more bargaining by simplifying 'agreement making procedures', it has had adverse implications for procedural and substantive fairness. The AFPCS continues this trend of weakening protective regulation which will only exacerbate existing inequities, especially for the most vulnerable. More particularly, we argue that the impact of the AFPCS must be evaluated in the context of the other introduced reforms, especially the unfair dismissal law exemption. The following analysis also considers the development of the AFPCS in an international context. Prime Minister Howard has asserted that the passage of the WorkChoices reforms will still leave the Australian labour market more regulated than that of the UK and New Zealand. Implicit in this argument is that these are the countries we should be using as benchmarks against which to assess the legislation. So it is important to look at the evidence on the extent of regulation designed to protect wages and conditions in the decentralised bargaining environments of the United Kingdom and New Zealand Drawing together these strands of analysis, the paper concludes that, over time, the AFPCS is likely to result in deleterious bargaining outcomes, particularly for those with little bargaining power in the Australian labour market