The Guardian 27 February, 2008
"AWAs are dead"
Anna Pha
Faced with the possibility of a double dissolution over a policy that was one of the main reasons for its downfall, the Liberal-National Coalition has backed off their defence of Australian Workplace Agreements (AWAs). Opposition industrial relations spokesperson Julie Bishop was forced to pull her head in and agreed not to block the new Labor government’s bill that sets out the transition process for the eventual abolition of AWAs. The AWAs — non-union individual work contracts by another name — were the centrepiece of the former Coalition government’s industrial relations policy.
As soon as the bill comes into force, employers will no longer be able make new AWAs. But the Opposition plans to use its numbers and friends in the Senate and push on with a Senate Inquiry, with a reporting date of April 28. The government had wanted a much shorter time span for any inquiry, claiming the policy was released last year and that there has been plenty of time for scrutiny. It has a tight schedule to get the new system up and running in 2010.
The inquiry has successfully bought employers more time to sign workers up on AWAs. Companies such as the Commonwealth Bank and Telstra have indicated that they will continue to sign new employees onto AWAs. They are free to make new AWAs until the legislation is enacted.
After that date, employers who already have workers on AWAs will be able to hire new workers on a new type of individual contract called individual transitional employment agreements (ITEAs). All ITEAs and new collective agreements will be subject to a new no-disadvantage test.
To pass this test, the Workplace Authority Director must be satisfied that an ITEA would not result, on balance, in a reduction in the employee’s overall terms and conditions when compared with an applicable collective agreement or, if there is none, then an applicable award and the minimum wage rate as set by the Australian Fair Pay and Conditions Standard.
In the case of new collective agreements and variations to existing agreements, the comparison is made with an applicable award and the pay standard.
Employers will no longer be able to wipe out key award provisions regarding leave and other entitlements — the conditions under WorkChoices that the Howard government claimed were "protected by law". They will gain considerable, but not absolute, protection under the new no-disadvantage rule.
Employers will have the right to argue for exemptions from the rule if it is "in the public interest" — a let-out clause that might be expected to be used when an employer has economic difficulties.
The only form of individual contract permitted after the phasing out of AWAs and the interim individual transitional employment agreements will be common law contracts. These operate outside of the Australian Industrial Relations Commission and Workplace Relations Act, in a similar fashion to other common law contracts such as between businesses.
Meanwhile Senator Bishop has been left to hang by her parliamentary leader Brendan Nelson who has pragmatically been forced by the labour movement and broader opposition to accept that AWAs are dead.