More Info
									Australian Chamber of Commerce and Industry                                                                      June 2006

                                                                         ISSUES PAPER


              ith WorkChoices now law, the battle for the hearts and minds of the public has moved from the
              Parliament to the workplace. It is now up to employers to use its provisions wisely and take
              advantage of new flexibilities to build better relations with staff, strengthen their business and
              improve productivity.

Last year, something different happened. Union officials,       over months and years, not days or weeks.
with a cheque book of about ten million dollars, took a
political debate about employment law into the lounge           The past month has been a classic on the fear front.
room, and in prime time.                                        Unions have expressed outrage at a workplace agreement
                                                                that did not include penalty rates, ignoring the fact that
Union officials knew they could not win the argument in         most employees don’t get paid penalty rates, and that the
the parliament. So they decided oppose WorkChoices with         agreement paid a starting wage of almost $100 per week
a public relations campaign.                                    above the minimum wage.

The government responded in kind with a blaze of                Unions have claimed shock that most agreements don’t
advertising, which only seemed to give prominence to the        include all previous award rules, ignoring the fact that the
union campaign.                                                 reason for workplace bargaining in the first place was to
                                                                give employers and employees the power to change some
Now the unions are at it again, spending the money of           of those rules.
members and fringe community groups in the lead-up to
union protest rallies at the end of this month.                 The ALP’s decision to tear up hundreds of thousands of
                                                                Australian Workplace Agreements if it wins government
Twelve months into this campaign, a large number of             is an extreme response to the fear campaign.
people are uneasy. There is scepticism in the community
about some of the changes, and the need for change.             Unions promote fear about wage reductions when the
But the public also know that similar changes in the            facts show otherwise. They demand that the minimum
past have been to the good with higher incomes, more            wage regulator (the Fair Pay Commission) increase wages
flexible work arrangements, fewer disputes and half the         by at least the rate of inflation, ignoring the fact that no
unemployment rate. They like the fact that we now have          minimum wage regulator in Australia’s history has been
an unemployment rate as low as 4.9%, unheard of in the          required to do that, and that the unions own policy from
last 30 years.                                                  1983 to 1996 was to increase minimum wages by less than
And they know that Australian jobs and living standards
are vulnerable in a global economy if we don’t keep             The government’s problem is that it is harder to sell
adding flexibility and productivity to our economy. They        economic reform in good times than bad times. Never
heard this same union scare campaign in 1996, yet things        mind the fact that in bad times it’s too late to reform. In
got better – not worse.                                         the early 90’s a million people were unemployed when
                                                                the economy turned because we delayed labour market
The battlelines between the government message and              reform.
the union message have been drawn. Unions sell fear of
reform while the government sells its benefits.                 The battle over WorkChoices has now entered its next,
                                                                and more interesting, stage - implementation. The
Conventional wisdom is that in the short term unions            conventional wisdom that this is a battle between the
have had the easier task. Fear of the unknown is an             government and union officials no longer holds true.
instant emotion. In contrast, the benefits of reform occur      A third player in the debate now takes centre stage

                                         LEADING A U S T R A L I A N B U S I N E S S
                                             Australian Chamber of Commerce and Industry   June 2006

– employers and employees in the workplace.

The public can now test how the claims and counter
claims stack up in the real world – in their workplace.
Union claims that employees will be sacked for no good
reason, that wages will be cut, that disputes will be created
will not cut the mustard with workers if that is not their
experience in the office or on the factory floor.

When the next wage increase is paid, when the next
promotion occurs, when time off is given for family
emergencies, when new staff are put on then the union
hype will fall far short of its claims.

The public would have been dudded, this time by the
lounge room to lounge room salesman, not the door to
door salesman.

Scepticism about WorkChoices could quickly turn into
a realisation that, not without coincidence, the union
campaign furthers the political desire of union officials
to get rid of the government and return themselves to
positions of political influence.

While he claims he said it in jest, it was not very funny
when on 26 June ACTU Secretary Greg Combet said, “I
recall we used to run the country and it would not be a bad thing if
we did again.”

These scenarios mean that the ball is very much in the
court of Australian employers. How they respond to
WorkChoices will be telling. They influence the hearts
and minds of employees in a much more credible way
than union or government claim and counter claim. If
employers build good relations with staff, and use the
new flexibility in making agreements wisely, then they
will expose a large credibility gap in the case against

They will present WorkChoices for what it is – a sensible
response in touch with the flexibility needed to conduct
business and work in our modern society and where only
one in ten workplaces have union members.

This is where the real debate about labour market reform
will be won or lost. Not in politics. Not in million dollar
television ads. But in workplaces.

Issues Paper                                                                                      2

To top