Business groups and unions will be brought together to try to change a system that Morrison says is “not fit for purpose”.
But reaching meaningful agreement will not be simple or straightforward.
This was the basis for economic reform built on wide consensus between employers, unions and government.
However, there are many differences between the special circumstances of the Accord and now, which may indicate the chances of success for the current initiative.
Hawke had the advantage of high levels of trust from both unions and employers, based on his years as a successful negotiator as ACTU president and industrial officer.
Another difference with the Accord is that in the 1980s, the industrial relations system was more centralised. So, employer organisations and the ACTU enjoyed greater coverage and authority among their own constituents to bring them to an agreement.
What needs to be fixed in 2020Joel Carrett/AAP
Morrison has announced five working groups, to be chaired by Industrial Relations Minister Christian Porter. The groups will look at award simplification, casual and fixed-term employment, greenfield projects, and compliance and enforcement for wages and conditions.
Most of the working group topics relate to employer groups’ reform agenda. The Business Council of Australia has advocated for greater flexibility and simplification of the award system for the economy to successfully rebuild.
Unions may be more interested in simplification of the enterprise bargaining system to benefit workers. They are concerned with the ease with which employers have increasingly terminated agreements and moved employees onto lower paid awards.
The casual workforce is likely to be a contentious area for discussion.Lukas Coch/AAP
There may be grounds for agreement on this issue. Employers would need to concede a formula for long term casuals’ easy conversion, if they choose, to permanent employment. Unions would need to concede no leave entitlements for employees who choose to remain casuals.
Greenfields agreements on large construction sites have enabled employers to reach enterprise bargaining agreements with a small number of employees before most workers are hired. Workers who are hired when the project gets fully underway are then bound by the agreement.
Compliance and enforcement
There may be more common ground over improved compliance and enforcement for wages and conditions. Employers and unions have condemned major cases of underpayment recently uncovered by the Fair Work Ombudsman.
However, better compliance may be difficult to reconcile with the government and employers’ desire for less regulation.
Where to now?
Unions and employers have indicated willingness to participate in good faith, despite the huge challenges they face. But the omens are poor.
There is already disagreement over the Fair Work Commission’s annual minimum wage decision, due in July.Joel Carrett/AAP
The Australian Chamber of Commerce and Industry has argued the minimum wage should remain frozen until at least mid-2021. It has even cited a precedent of the 10% reduction awarded on the basis of capacity to pay during the Great Depression.
There is also a serious question as to whether industrial relations reform is the right place to be looking to reboot the economy.
Former top public servant Michael Keating was head of the Employment, Finance and Prime Minister’s departments during the Accords era.
Writing last month, he said Australia’s industrial relations regulation was more flexible than that in the United States, and the reforms of the past 25 years have had little substantial impact on productivity, labour market adjustment, wages growth or industrial disputation.
Keating also warned that industrial relations reform is mainly “camouflage for lower wages, which is the last thing this economy needs right now”.
- ^ industrial relations overhaul (theconversation.com)
- ^ told the ABC (www.abc.net.au)
- ^ invited comparisons (www.afr.com)
- ^ Australian politics explainer: the Prices and Incomes Accord (theconversation.com)
- ^ constructive approach (www.pm.gov.au)
- ^ Jobs Protection Framework (theconversation.com)
- ^ refused to participate (www.abc.net.au)
- ^ Unions (thenewdaily.com.au)
- ^ business (www.abc.net.au)
- ^ Business Council of Australia (www.bca.com.au)
- ^ warns that this is code (theconversation.com)
- ^ tighter legislative definition (www.aigroup.com.au)
- ^ general right of conversion (www.abc.net.au)
- ^ Australian economy must come 'out of ICU': Scott Morrison (theconversation.com)
- ^ they earn less (www.smh.com.au)
- ^ been a battleground (corrs.com.au)
- ^ Greenfields agreements (www.fwc.gov.au)
- ^ major cases of underpayment (www.abc.net.au)
- ^ angering business groups (www.smh.com.au)
- ^ should remain frozen (www.news.com.au)
- ^ record lows before the COVID-19 (www.abc.net.au)
- ^ View from The Hill: Can Scott Morrison achieve industrial relations disarmament? (theconversation.com)
- ^ last month (thenewdaily.com.au)
Authors: Ray Markey, Emeritus Professor, Macquarie University