PATRICIA KARVELAS: We’re just days out from the government’s Jobs and Skills Summit, but an industrial relations deal has already been struck between the ACTU and the Council of Small Business Australia. Now the agreement would allow unions to simultaneously negotiate wage agreements with multiple employers across the same sector and introduce a simpler test for approving those deals. It’s been read as an auspicious sign ahead of the summit, which aims to deliver agreement between unions and employer groups on wages, enterprise bargaining and also productivity. Tony Burke is the Minister for Employment and Workplace Relations, and he joins us from our Parliament House studio. Minister, welcome.
THE HON TONY BURKE MP, MINISTER FOR EMPLOYMENT AND WORKPLACE RELATIONS: Good morning.
KARVELAS: How significant is this agreement between the ACTU and COSBA, the Council of Small Business Australia, and what do you believe it will deliver for people working in small business?
BURKE: It’s exactly the sort of cooperation we’ve been hoping to achieve with the summit. And while the summit itself isn’t until Thursday and Friday this week, realistically in terms of the conversations around it, it’s been going for a while now, and that’s what has brought an agreement like this together. When the concept of multi employer bargaining was first flagged by the ACTU last week, I leant in, saying I was very interested in it, and one of the areas that really caused me to be interested is small business. Effectively for both employers and for workers, if you’re in small business right now, you are cut out of any of the benefits of bargaining, whether they be from a business perspective, the simplicity, the efficiencies, just having one single document that you can refer to, or from a perspective of employees, some of the pay rises that tend to come with agreements. So, this – and the reason that small business is cut out isn’t that the law says, “oh, small business can’t access it,” small business doesn’t have an HR department. They don’t have the resources to do this.
I grew up in a small business family myself. I’ve run my own small business. I know that you’re spending your day on the fundamentals of the business and something like bargaining is something that you’re not going to have the opportunity to be engaged with. So, multi employer is the only way that you’re going to have a chance to significantly open this up to the small business sector.
KARVELAS: COSBA says the ACTU’s proposal for multi employer bargaining works for small business because they don’t have the resources for wage negotiations and, as you articulate, the HR departments, all of the sort of bells and whistles of a bigger business. But do you see this as a viable template for big business or might this idea for multi employer negotiation be limited to the small business sector?
BURKE: I’m not here with a proposal. We’re seeing how these discussions continue, and I’m encouraging the different business organisations not to simply draw the lines of haven’t needed this in the past, don’t want it, and to lean in and see where these sorts of opportunities might work. None of this is to undo the concept that the main form of bargaining will continue to be enterprise bargaining. So, directly, between workers and employers will, I think, always be the agreements that are most common. But particularly in small businesses, the agreements that haven’t been possible, have been agreements in industries like childcare, like aged care, like smaller retail, and when you look at those industries in pretty much every case, you’re looking at workplaces where the majority of people working there are women, and they’re the ones that have tended to miss out on bargaining. There’s a direct link between this conversation and some of the things we need to do to close the gender pay gap.
KARVELAS: The agreement also includes a simpler form of this Fair Work Act’s better off overall test, the so-called BOOT. Do you agree with Sally McManus that the same test should apply across the workforce and is that the right template?
BURKE: Look, I’ve been, up until the summit, pretty hard-line on the better off overall test, and I took the view that if I was expecting everybody else to come forward with compromises and to try to find a way together at the summit, that I should be willing to do the same. So, while I’m very careful and wary of changes to the better off overall test, I’m not ruling out that we might be able to find compromises that make the whole system work more effectively both for workers and for employers.
KARVELAS: Okay. This is a significant moment, Minister, because you have been hard-line, and I’ve been wanting to go to the BOOT for a while, and, in fact, it was part of the election campaign. There was a week certainly focus on the BOOT. What are you prepared to consider to change the BOOT? Does it mean, that rather than every single individual test needing to be better off overall, a wider interpretation could be used?
BURKE: I’m not wanting to set lines because if I set lines, I think, effectively at the moment that will curtail the conservation. I’m really interested in only today – go back one week, who would have thought that we might have seen an agreement between the ACTU and the peak body for small business, COSBA, on bargaining. We are seeing now agreements and proposals effectively across the aisle that would have been unthinkable previously and a whole lot of goodwill is being shown there. So, for myself I think if I start to draw lines on that, I think it will curtail that conversation.
KARVELAS: So, you can see the case for a change to the BOOT now?
BURKE: The thing that I would say is I am determined to get wages moving. I want to see whatever proposals we’re looking at that they are proposals that get wages moving, and when the previous government had come forward with proposals with respect to the better off overall test, they had been proposals that were directly allowing wages to be cut. I have no interest in that. But if there’s creative ways that people can come up with that allow something more flexible but still see wages get moving, then I’m interested.
KARVELAS: We know that even the ACTU has articulated a case for changing BOOT, and I suspect Sally McManus is not a great fan of cutting wages, so do you see a template – making it simpler, making easier, making it less prescriptive – for the Fair Work Commission, which is the big criticism at the moment, that it’s just too explicit?
BURKE: Yeah, and I think this is not the only section where people have looked at how the Act has played over the last 10 years and it’s very legalistic.
KARVELAS: And very literal.
BURKE: Yeah, yeah and so not only on the better off overall test, on a series of the different procedures you need to go through to be able to get an agreement registered, there are tiny clauses, tiny specific rules, agreements that have had more than 90 per cent support of members that have sometimes been overturned on a technicality. Wherever we can make the system more practical, then I’m interested. You look at those sorts of rules, and it’s no wonder small business hasn’t been part of it.
KARVELAS: The Morrison Government’s attempt to strike a new accord failed partly because business groups split. ACCI and the AI Group have both raised concerns in relation to multi employer bargaining. It seems like the Business Council has some more opening to it. So, there is a split in the business groups. Can uniform changes succeed if they’re not all on board?
BURKE: We’re not naive. We don’t pretend for a minute that consensus means every single person at the summit ends up with the same view. But when you start to get agreements between some business groups and the ACTU as a representative of workers, like we’ve seen today, a government has to look really seriously at those sorts of proposals. So, there will always be different views from different groups. I’m on for that. I don’t think we have any way of avoiding that, Patricia.
KARVELAS: I want to move to another part of the puzzle, if you like and that’s the unemployed people who would like to get into the work, but really, we are now dealing with a really, really disadvantaged cohort of unemployed people. Are you prepared to consider the call by ACOSS to lift the Jobseeker rate from $46 to $70 a day, and do you think that conversation needs to be part of this summit?
BURKE: Well, there’s no doubt it’s going to be raised at summit. It was raised – I think ACOSS had a round table with Amanda Rishworth last week. There’s further round tables that ACOSS will be at that I’m hosting this week, so those issues will be raised. There will be a series of issues that get raised there. Some of them will be directly in my portfolio in terms of how the different employment programs work and what their strengths and weaknesses are. So, there will be issued around the housing programs that the government has. All of that will be raised. Ultimately when we hit the Budget in October, which is where these issues get reviewed every year when you look at the Budget, there will be things that we want to do that we can’t do and that’s the reality of a trillion dollars of Liberal debt. Particularly as inflation goes up, that debt now costs a lot more than it cost even a year ago, so there will be things that we would want to do that people would like us to do, that aren’t going to be possible, but those decisions will all be –
KARVELAS: Is this an example of you basically saying, you know, this is just too expensive?
BURKE: Look, it’s a decision that gets made in the Budget, but it’s hard.
KARVELAS: And yet we’re dealing with the most entrenched disadvantaged people who are really struggling. Do you think you can move them to employment on that current rate given it builds in a chronic inability to get yourself job ready?
BURKE: It’s one of the features of – obviously as Employment Minister, I’ve got the programs that are meant to be helping people find their way into work, and one of the features of low unemployment is we now have a higher proportion of long term and very long term unemployed than we’d previously had. Now, because there’s fewer people in the system, at one level it means there should be an opportunity to be able to wrap as many services around people as possible to help them in. It’s one of the reasons why we’ve moved from just it being a blanket 20 applications a month to saying, okay, are there courses? Are there different work that we can help people with that gives them a better pathway into employment? But we’re only in the second month of that new system. A lot of it was designed before we came to office, and the contracts had all been designed before we came into office, so I’m still very mindful of what we can do. But the challenges of the people who are in the system right now are exactly as you’ve described.
KARVELAS: Tony Burke, thanks for joining us this morning.
BURKE: Great to talk.
KARVELAS: Tony Burke is the Minister for Employment and Workplace Relations, and he joined us there from Parliament House.