24 November 2007

How will a Rudd Government affect your workplace relations arrangements?

The Labor Party's victory in the Federal election is likely to bring about yet another significant turning point in Australian workplace relations.

Work Choices was a key issue in the campaign, but how far the new Labor Government can amend present workplace relations legislation will depend on the final composition of the Senate and the extent to which it can gain support for its IR policy from other political parties if needed.

What action should employers take?

It is likely that Labor's intended workplace reform will not be legislated upon until well into 2008. Accordingly, in the vast majority of cases, employers need not take any immediate action.

However, employers should be aware of key dates in relation to workplace agreements, as set out below.

Australian Workplace Agreements (AWAs)

If employers wish to make any new AWAs, they have only limited time to do so. Once in operation, Labor's IR policy contemplates that AWAs will continue to be effective after Labor's workplace reforms.

According to the announced policy, the mere entry into one AWA in a business prior to 1 December 2007 will entitle an employer to later utilise Individual Transitional Employment Agreements (ITEAs) in relation to all of its employees until 31 December 2009. ITEAs may enable employers to contract out of "protected award conditions", much like AWAs presently allow.

Collective agreements

Non-union agreements may be easier to achieve, from a procedural perspective, prior to Labor's proposed legislative changes. Labor's IR policy contemplates that employers will be required to negotiate in "good faith" if the majority of employees wish to make a collective agreement.

Further, Labor's IR policy does not say whether employer greenfields agreements will be available post Labor's workplace reform. Employers wishing to make employer greenfields agreements need to consider the risk that this option may not be available in the future.

Key dates

Key dates in relation to the ALP’s proposed amendments to workplace relations policy at this stage are:

• 1 December 2007: ability to enter into the transitional form of future AWAs (ITEAs) ceases if at least one AWA has not been entered into by this date.
• 31 December 2009: ability to utilise ITEAs ceases and all existing ITEAs expire.
• 1 January 2010: introduction of legislation to ensure employees earning above $100,000 a year are award-free.
• 1 January 2010: all employees of a corporation will have a statutory entitlement to severance pay on redundancy (according to the current Federal award scale) where the business employs 15 or more employees.
• 31 December 2012: all AWAs will have reached their nominal expiry date (and may not have effect after this date).

Click here for the major policy changes that are likely to occur under the Labor Government and the impact such changes will have on employers.

We will keep you informed of developments in Labor's policies in this vital area.