COVID-19 regulatory response: Facilitating necessary flexibility or an ideological attack on workers’ rights? (by Renee Burns)
7th May, 2020
This latest guest contribution on the Labour Law Down Under Blog is by Renee Burns – Research Assistant at RMIT University Law School on the ARC Linkage Project ‘Trade Union Training in Australia’. She is the author of a new article out this week: ‘Freedom of Association and Collectivity in Australia’ (2020) 44(2) New Zealand Journal of Employment Relations 20.
Other guest contributions are invited from the academic community, especially on issues relating to the impact of COVID-19 on work, workers and the regulatory framework for employment relations. Email me at: anthony.forsyth@rmit.edu.au
Since the COVID-19 pandemic hit our shores we have seen multiple examples of employers and unions working together to ensure both businesses and their employees benefit from timely and responsive alterations to existing enterprise agreements. Scott Morrison was quick to announce ‘[t]here are no blue teams or red teams, there are no more unions or bosses, there are just Australians now’.[1]
On 16 April 2020 Industrial Relations Minister, Christian Porter authorised Amendment Regulations that reduced the access period for proposed changes to existing enterprise agreements from seven days to 24 hours. Porter declared the changes necessary to ‘give employers greater flexibility to rapidly respond to the extreme and urgent workplace challenges caused by the COVID-19 pandemic’.[2] The Explanatory Statement accompanying the regulations notes consultation with referring states and territories but not the ACTU. The Explanatory Statement goes on to note that no Regulation Impact Statement was required as the regulations were made in response to COVID-19. But have these regulations genuinely been made as a necessary response to the pandemic or just in its proximity?
Unlike the recently implemented JobKeeper scheme, the regulations as made apply to all businesses covered by existing enterprise agreements; with no requirement to demonstrate a downturn in business or other COVID-19 related detriment. The regulations do share a sunset clause with other COVID-19 responses – with the access period reverting to seven days after six months’ operation – however, any changes made to enterprise agreements under the regulations will continue in perpetuity.
Implications for workers’ rights
For the purposes of making and varying an enterprise agreement the ‘access period’ refers to the seven days immediately prior to voting in which employees must be given access to the full text of a proposed agreement or variation and information about what is proposed. ACTU Secretary, Sally McManus has described seven days as ‘adequate time to consider any proposal to change an enterprise agreement, to discuss this with their employer, other workers and to seek advice … the effect of reducing this period to 24 hours leaves workers exposed to employers seeking to exploit the fear caused by the pandemic and to pressure workers into rushed agreements, locking out their access to advice’.[3]
The Fair Work Act[4] sets out to provide ‘a balanced framework for cooperative and productive workplaces relations…considering Australia’s international obligations…enabling fairness and representation at work…and achieving productivity and fairness through an emphasis on enterprise-level collective bargaining.’ The Explanatory Statement to the regulations acknowledges Australia’s obligations at international law ‘to encourage and promote machinery for voluntary negotiation between employers or employers’ organisations and workers’ organisations, with a view to the regulation of terms and conditions of employment by means of collective agreements.’[5] As it stands, the FW Act strips trade unions of their status as parties to agreements and in doing so offers a ‘fundamentally individualised’[6] approach, that fails to redress the ‘inequality of bargaining power… inherent in the employment relationship’.[7] As Read observes ‘[a] self-represented employee is not represented in the traditional sense, really they are just speaking on their own behalf – effectively unrepresented’.[8] This approach has been found to be inconsistent with Australia’s international obligations,[9] with the effect of undermining a worker’s right to representation.
Having established an imbalanced bargaining scheme, the FW Act seeks to address this by requiring agreements and variations to have been genuinely agreed by employees.[10] This is attempted through highly prescriptive procedural requirements for the approval of agreements and variations. These include the requirement that employees are afforded a full seven day[11] access period. A strict compliance approach to these procedures is justified given they are designed to act in lieu of genuine collective representation and voice.
Chipping away
The new regulations are not the first time we have seen workers’ right to representation undermined in this way. In 2018 the FW Act was amended[12] to afford the Fair Work Commission discretion under the new section 188(2) to conclude that an enterprise agreement has been ‘genuinely agreed’ despite ‘minor procedural or technical errors’ made in relation to the pre-approval process. In approving an agreement in these circumstances the Commission must be satisfied the employees in question were not likely to have been disadvantaged by the errors.
At December 2019 section 188(2) was engaged in the approval of 76 enterprise agreements; those concerned with procedural failings were dominated by contravention of the access period. Most commonly access period errors arose from misunderstanding the requirement for seven clear days, resulting in votes mistakenly conducted on the sixth day. This data suggests that in the main the Commission would appear to be applying its discretion as intended – to prevent agreements genuinely agreed by parties being rejected due to genuine, minor and inconsequential errors. However, in CBG Systems Pty Ltd[13] an agreement was approved after unrepresented workers were provided with an access period of only two days; the Commission accepting this was a ‘minor’ procedural error on employer evidence that all staff were ‘actively engaged throughout bargaining [and all]…cast a valid vote to approve the Agreement’.[14] Cases such as CBG give rise to a concern that errors of a particular category – such as ‘access period errors’ – when overlooked in growing numbers might risk forming a ‘class of error’ capable of being automatically overlooked. Essentially the COVID-19 regulations have defined, for the purposes of agreement variation, just such a class, chipping away at workers’ rights to be meaningfully engaged in the variation process.
What’s next?
In the context of an already compromised right to representation, the protective purpose of the seven-day access period must be respected and preserved. Labor and the Greens have each announced they will seek to have the regulations disallowed when the Senate sits next week, with Centre Alliance senator Rex Patrick reported to be giving ‘serious consideration’ to supporting the disallowance.[15] Meanwhile the CFMMEU has lodged an application with the Federal Court to have the regulation overturned, arguing it is ‘inconsistent with the Fair Work Act’.[16]
Changes made to enterprise agreements under the new regulations are permanent, accessible to all businesses and continue an identifiable pattern of weakening workers’ representations rights. As such, the new regulations – introduced without consultation – look to be less a necessary lifeline of flexibility and more like a wolf in COVID clothing.
[1] Paul Kelly, ‘‘Team Australia’ our new normal, for now’, The Australian (online), 3 April 2020 <https://www.theaustralian.com.au/inquirer/team-australia-our-new-normal-for-now/news-story/6d82a41e2d559df928c3017fd26e78f7>.
[2] Paul Karp, ‘Labor and Greens to oppose Coalition’s ‘dangerous’ workplace regulation changes’, The Guardian (online), 21 April 2020 <https://www.theguardian.com/australia-news/2020/apr/20/labor-and-greens-to-oppose-coalitions-dangerous-workplace-regulation-changes>.
[3] ACTU, ‘Business demanding 1 day “consultation” on agreement changes’ (Media Release, Australian Council of Trade Unions, 16 April 2020) < https://www.actu.org.au/actu-media/media-releases/2020/business-demanding-1-day-consultation-on-agreement-changes>.
[4] Fair Work Act 2009 (Cth) s 3(a) (‘FW Act’).
[5] Explanatory Statement in reference to Right to Organise and Collective Bargaining Convention, opened for signature 1 July 1949, 96 UNTS 257 (entered into force 18 July 1951) Article 2.
[6] Kurt Walpole, ‘The Fair Work Act: Encouraging collective agreement-making but leaving collective bargaining to choice’ (2015) 25(3) Labour and Industry 205, 212.
[7] Otto Kahn-Freund, Labour and the Law (Stevens & Sons, 2nd ed, 1977) 6.
[8] Rosalind Read, ‘The Role of Trade Unions and Individual Bargaining Representatives’ in Shae McCrystal, Breen Creighton and Anthony Forsyth (eds), Collective Bargaining Under the Fair Work Act (Federation Press, 2018) 69, 85.
[9] Complaint against the Government of Australia presented by the Communications, Electrical, Electronic, Energy, Information, Postal, Plumbing and Allied Services Union of Australia (CEPU), Document Vol XCIII, 2010, Series B, No. 2, Report 357, Case 2698 (CFA Report, Case 2698) [215]-[216].
[10] FW Act s 188.
[11] Ibid s 180.
[12] Fair Work Amendment (Repeal of 4 Yearly Reviews and other measures) Act 2018 (Cth).
[13] [2019] FWCA 3261 (“CBG”).
[14] Ibid [4].
[15] Paul Karp, ‘Labor and Greens to oppose Coalition’s ‘dangerous’ workplace regulation changes’, The Guardian (online), 21 April 2020 <https://www.theguardian.com/australia-news/2020/apr/20/labor-and-greens-to-oppose-coalitions-dangerous-workplace-regulation-changes>.
[16] Ewin Hannan, ‘CFMEU launches court battle against Morrison government over enterprise agreements’, The Australian (online), 5 May 2020 < https://www.theaustralian.com.au/nation/cfmeu-launches-court-battle-against-morrison-government-over-enterprise-agreements/news-story/58722d23c800ee85983baa479b331b40>.
