This is an AI Group podcast. In this podcast, we'll be discussing the most significant workplace relations issues over the month of September 2022. The full members only report is available on our website at aigroup.com.au. It's in the news section under reports and policy papers.
With me today to discuss the key aspects of this latest report is Brent Ferguson. Hi, Brent. Brent is AI Groups Head of National Workplace Relations Policy. I'm Tony Melville, AI Groups Head of Corporate Affairs.
We'll just focus on a few issues in this brief podcast today. And they are the Jobs and Skills Summit, which Brent and I both went down to. Chief Executive Minister Alex and Megan Lilly were there. A lot of talk on skills, but also a lot of talk on IR bargaining laws, multi-boy bargaining laws, a lot of controversy.
We'll also talk about the paid domestic violence leave bill. The annual leave shut down case and the professional award cases, both cases that everyone really should be across. So I'll get right into it. Now, the summit was a couple of weeks ago now in Canberra, but it still lingers on in terms of influencing implications.
Probably the biggest issue from members' point of view was talk of the reform of bargaining laws and multi-employer bargaining. So you want to talk about the general bargaining first and then go into the multi-boy? Yeah, look, I'm sorry. I think as you say, one of the most controversial aspects of the summit was the discussion around reform of bargaining laws.
Now, in that context, you had employer groups pushing for some really necessary improvements to the system to make some sensible changes to make it more flexible and frankly simpler to use. It's become a real line for employers. Conversely, you had unions saying that the system needed much, but whatever form. In order to enable some of the groups to have a traditionally utilized it to access bargaining and to drive increases in wages.
Now, it'll probably play out in a couple of different ways. Firstly, there is discussion going on post-the summit between the groups and the government. And really that's because bargaining is one of the areas in the summit where we didn't reach a lot of consensus. The data of work is being done now.
So what you're also going to ask you about that process, how is that work? Are you between from Canberra and other industry organisations as well in government? Yeah, that's right. So the government's holding discussions with the interest of the key interest of parties.
So the ACTU also came for it. Now, it's meant that I'm back and forth to Canberra every few days for detailed discussions with the department where we work through the kinds of issues that they're looking at potentially legislating. I know the conversations will be confidential, but is there some common ground agreement on what the problems are and that maybe what can be fixed? Yeah, look, I think the first thing that I have, there is a degree of confidentiality, so we can't share the data.
But I think there is a shared acceptance that there's a complexity to the system and there's a shared desire to make the system simpler. I think where we start to diverge is really what that means and what the fixes should be. Now, for employers, the key issue is that we want the process to make it simpler. It shouldn't be that there are highly prescriptive rules about how you conduct the vote, how you explain the terms, how you make the application for your agreement.
There's lots of improvements that can be readily made. Everyone knows the issues. The other issue is the vote. And without getting into the details in practice, the better or overall, I think we will use the terms so often.
But in practice, employers often raise concern of the way it's applied by the commission is openly inflexible and it's implied in that way. It means that agreements that are struck, but all parties want and recognise as being beneficial to workers are getting knocked back. Now, there's lots of discussion about precisely what we should do to fix that. But I think the significant point is probably going into the summit.
The minister had made it very clear that he had a reluctance to touch the vote. But where we've got to is that it is squarely on the title. And I think you can expect some change to make it more flexible to realise. The elephant in the room had jobs and skills, so much was multi-employee bargaining.
The ACTU, Selling That Manus, came out and said that this was a great ambition of theirs to get back to the days where you could have presumably, because there was no detailed industrial election, across sectors, across industries, across all childcare centres in the country, not just one particular branch of childcare. So where are we at with a multi-employee bargaining discussion to debate? Well, I mean, I think the truth of it is that the union developed a concept, an idea that bargaining should be more readily available across employers, so that employees should have a greater capacity to coordinate their efforts to bargain against groups of employers, be the sector or a smaller group of employers. But there has a little bit of detail about precisely what they are after.
And so there's more questions and answers at the moment. So it might only be something like aged care workers or health workers. I might be talking about the whole economy, like all the modal dealers or something. I think the unions have identified areas where they would say it has particular justification.
So manufacturing is the concern, right? So the argument is that it's necessary in the care economy, the childcare sector, perhaps even in small business where the sectors that haven't been traditionally out of the market, I mean, some of those sectors to be frankly tiny can access multi-employee bargaining now, potentially under the fee work act, but unions have really tried. I think the alarm is, for many participants in industry, that while they're pointing to those that the bigger agenda or intent may be to get it across the sector or the industry more broadly. And that's the concern.
Well, the UW, United Workers Union put out a paper report of this week or something from last year, but that had a few scary bits in it as referenced to Supermarket Supply Chains and so forth. I mean, that'd be good. We don't need to see the transport and logistics industry suddenly shut down by sector-wide bargaining or sectors of the manufacturing industry, where this really makes no sense because there's been so much established bargaining. Now, as I said, we need to see the data a lot of this.
And it's being canvassed to some degree, but really there's a lot to do. Okay. So leaving the summit aside, and those talks will continue that out for us. We don't know timeframes.
It is happening intensely. And we really can't be specific how long it will take. But I think quite clearly the government has intended to do something and to do something quickly and move ahead of other areas. And there'll be opportunities for feedback from members.
So we're keeping engaging with members of the members who are concerned, certainly rich out. But we hope that there'll be meaningful consultation with industry committed in the development of the legislation. And the process to, once they do get the legislation, they're still committed to that law process, the Committee on Industrial Law, where we get involved in going through the law when they got it written. That's right.
So our group has a visual standing on various government committees to book a legislation as it's being involved and to have a legal exercise that we're at the table now working through it anyway. Okay. So what we're going to talk about is the, as I have been came with the paid domestic violence leave bill. Where are we at with that?
Well, members will recall that over recent years, there was a case conducted by the Full Venture Fair Work Commission responding in large measure to an ACTU claim for introduction of 10 days to pay domestic violence leave now that culminated in a decision by the Full Venture Grant paid domestic violence leave but to not granted in the terms proposed by the ACTU in various respects, they found their proposal unworkable or unreasonable and instead suggested an alternative form of entitlement. Now, following that decision being handed down and before we get to the next phase of those proceedings, we had the election of the Labor Government and now some of their intent to introduce a bill they've introduced legislation and it's actually passed a House of Representatives now and the next step will be to be, of course, put that by the Senate. So we have two things, two or three weeks left department this year, the various disruptions may well not be this year. Well, I think that's unclear.
Clearly being a big part. It was one of the first things that this government did into introducing the bill. The real issue is here, members should be aware that that bill departs from the position that the Full Venture and Commission landed on in various respects, significantly more owners for employers but I think that's even more importantly, it doesn't in mechanical ways operates very different like to what the Commission contemplated and it's going to be a real challenge for employers to deal with some of the elements of how it actually works. For example, so one of the issues is the Full Venture identified that employers should be paid at their base rate of pay.
This legislation adopts a proposal that employees would get their full rate of pay for the time they would have worked, how they not been on the lead. One of the justification is that employees experiencing this sort of raw matter or any reduction, because it's intended to take the leave. The real problem is how do you calculate that? Lots of awards and industrial instruments set contingent entitlements, so certain allowances, for example, piece rates.
The entitlement is worked out depending on what you actually do during the day of work. It is potentially impossible, frankly, to work out the full rate of pay with certainty in those sorts of circumstances. And it's really unclear how that's going to play out with the government and we can only hope that those issues are picked up by the Senate. Okay, it sounds like a bit of work to do there.
So there are a couple of interesting cases before the Commission. The first of the two is the annual leave shutdown in case. What's happening there? I think this is a case that needs to be bought on employers right out of the back line awards to give you a very high level context.
Many awards include shutdown provisions in their annual leave force. So they are clauses that effectively enable an employer who elects shut down their business to direct to people to take annual leave. The period of the shutdown, if they don't have enough leave to cover the shutdown to take unpaid leave. The difficulty is the full bench or majority of the full bench who looked at those clauses as part of the review awards has come to the view that the ability to direct somebody to take unpaid leave is an only force of pay.
So that awards can't include terms that enable an employer to make someone take unpaid leave during the period of shutdown and also form the view that even if awards caught from a jurisdiction perspective, that it wouldn't be fair in essence and that they would delete those provisions. Now, that has a huge significance for employers in the lead up to Christmas. The bench at this stage has just expressed that view and they have the ability alternate model clause that would be potentially inserted into every model that has shut down clause, but that clause doesn't include the right to direct people to take unpaid leave. So you have situations where someone starts work at a new job in November, they haven't accrued any leave and they have to reach out down in January.
That's right. So the would self won't give the employer the right to direct someone to take that leave. So I think that the case itself has some way to go. The commission is going to release draft determinations and that just means a draft version of these clauses and there's an opportunity for parties to make submissions about the conclusions they've reached in the fire schools.
So, the first thing that I think is going to be a very clear point, is that employers will certainly put a submission in advance and no doubt challenging the logic of full bench. But if the position is maintained, it does mean that employers are going to have to look at how they manage leave. Very closely, very closely, to make sure people have leave for crew in order to cover the period of shutdown. This is negative for employees as well because you get to October and you've got to go away for a week or two and your boss will say no, you can't go that way.
Frankly, there's generally a very corporate price tag with employees. Of course, we've been spending some of my hands on my pay delay. And employees are going to have to get ahead of that. And finally, they're going to have to look at what other options they've got in terms of getting employees to take the periods of unpaid late and so forth.
But it is a really significant issue. And surely a lot of the other organisations are also on the same page on this one. So we'd be a lot of support to look at this. We probably might be significantly involved in proceedings in terms of advancing employees' interest, but we will continue.
But I would expect that other associations will also support concerns around the workability of this course. So, the last one, the professionals award case. Again, I'll just give you a sense of what's happening there so people are aware. That's an award that essentially covers certain professional employees, certain engineering employees, scientific employees and certain IT professionals.
Now, unlike most awards, it takes a very flexible approach to the remuneration structure. In short, there is an annual salary that's payable. And then there's a clause that requires the employer to consider what work is done by employees, what additional hours or overtime is worked, what's called back work is performed by itself. And to take that into consideration and setting additional remuneration or benefits beyond that salary.
Now, as part of the initially part of all year of the award, the Commission has looked at that clause, the governing remuneration of that award and from the views that it's only possible. Now, what they've raised is the prospect that the award should potentially include overtime provisions, for example, for hours beyond 38 hours a week. A PESMA, the main union party involved in this is going to advance its submissions probably on Monday. And we expect that they will file a proposal that employers have to pay some sort of overtime.
Now, that'll be a big shift for a lot of employers who don't pay overtime to their professional staff. They treat them like other professionals and pay some sort of level managers. That's right. Employees who often agree exercise a high degree of authority themselves over what hours they work.
They make the decision quite often as to what hours they work precisely. Now, the idea that you have to go to a sort of bundy flop mentality over calling hours and paying them for every hour work really just is outstep with what employers do in fact with a lot of employees. But that is the sort of change that is potentially on the cards. We'll have to say what comes in from the unions, but we will be certainly arguing to make it as flexible as possible for employers.
Okay, there's another big case to keep working on there, that's never ends. Okay, well, that's it for this our group podcast on the significant issues brief of September. As I mentioned, you can get it on our group's website if you remember. On aigroup.com.au, one of the news section reports and policy papers.
Thanks a lot, Brent Ferguson, our group's have national work post. Thanks for that time. Okay, see you next time.