Tactics ahead of possible new Labor IR laws

If the polls are to be believed, in a little under three weeks from now we are likely to have a federal Labor government – and not long after, a new set of industrial relations laws.

Unsurprisingly, many business owners are starting to consider this prospect when looking at their employment arrangements. What is surprising, however, is the mixed response that the prospect of change has prompted.

In the restaurant and catering sector, businesses are accelerating their uptake of AWAs in an attempt to lock-in the benefits they confer for as long as possible, according to Restaurant & Catering Australia chief executive John Hart.

Hart says the five year transition period means there are still substantial gains to be made from moving on to AWAs, even if they are a due to eventually be phased out under Labor’s proposed laws.

And, he says, businesses are also taking into account the fact that the five year transition period means AWAs put in place now will see businesses through to the next election.

“If they sign now they’ve got five years, which will see them through to the next term of government and beyond, and who knows what might happen by the next election, so they are riding out the next period with the AWAs in place.”

However, Hart says, other parts of the hospitality sector where smaller businesses are less prevalent, such as hotels, are being prompted by the prospect of a change to Labor to drop AWAs and move on to collective agreements.

“A lot of our guys are too small to go down the collective agreement path. It’s not worth it for them even if the situation was more simplified, but in other sectors they are going on to collective agreements or even awards,” Hart says.

Australian Business Lawyers managing partner Tim Capelin, who provides IR legal services to businesses across a range of businesses and sizes, says he is seeing a noticeable shift towards collective agreements as the likelihood of a Labor win has increased.

And, he says, the increased red tape the fairness test has brought to the process of moving to AWAs has also been an important motivating factor.

“A pragmatic business would be crazy not to think about a change with the current polls – and they would also be thinking about how advantageous AWAs are to them after the introduction of the fairness test, and in our practice we’ve seen clients doing exactly that,” Capelin says.

Workplace Relations Minister Joe Hockey has promised that he would resign from his ministry if a future Coalition government changed current IR laws, including the fairness test.

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