Workplace Regulation

Recommendation Summary

  • Continue funding the Australian Building and Construction Commission
  • Provide additional resources to the Fair Work Commission
  • Enhance the compliance capability of the Fair Work Ombudsman

A critical dimension of any structural reform must address the regulation of work. Australian employers want to grow, invest and create jobs which will in turn continue to assist the Australian economy to grow and remain internationally competitive. To do this CCIQ seeks a workplace relations framework that is practical, competitive, balanced, simple and fair. The workplace relations recommendations contained in this submission are only those which have budgetary impacts. The Government should however not lose sight of the fact that Australia is continuing to fall well short of the mark when it comes to workplace relations. Without broader reform to our workplace relations system we will see serious and significant impacts on the broader economy, labour productivity and our international competitiveness. For our future economic prosperity and success we must ensure that our workplace relations policy framework ensures Australia is an attractive destination for investment and employment, creating flow-on business opportunities for SMEs, local jobs and revenue for the benefit of the whole community.

1. Enhanced Fair Work Ombudsman Compliance Capability

It is important that Australian employment laws are complied with by employers, employees, unions and registered employer bodies, and properly funding enforcement to effective levels must be one of the key aims of funding the workplace relations portfolio in the budget.

The Fair Work Ombudsman (FWO) plays a key role in the enforcement of compliance with the Fair Work Act 2009. The FWO currently has approximately 185 Fair Work Inspectors who conduct investigations, inquiries, audits and pursue enforcement outcomes on behalf of the FWO. There are also approximately 40 lawyers who support these investigators, by providing advice, assessing briefs of evidence and litigating matters in the courts.

CCIQ supports the Government working to stamp out exploitation of Australians at work, particularly amongst younger people. Nevertheless there is an increasing awareness of and concern within the Australian community about non-compliance with workplace laws, and an expectation that there is a ‘tough cop on the beat’ in this space. Notwithstanding that the FWO represents world’s best practice in enforcement, there is clear and increasing community concern that underpayments are too frequent and widespread. Appropriate penalties are in place, and inspection and enforcement have significantly improved, however underpayment continues to happen too often.

Additional Fair Work Inspectors would position the FWO to respond more proactively and strategically to the breadth of this serious problem, and to non-compliance in particular industries, locations, sectors or involving particular cohorts of workers. It would also assist in developing/extending the necessary cultural of compliance in Australian workplaces in order to deliver more consistently on the community’s expectations that exploitation of workers will not be tolerated and will be met with serious consequences in a manner beyond current resourcing capabilities of the FWO. More inspectors will also simply put more boots on the ground, more employees will be prompted to check and raise concerns, and more employers will be prompted to check they are getting it right.

It is recommended that funding of the national workplace watchdog, the Fair Work Ombudsman, be boosted in order to fund an additional 50 workplace inspectors across Australia. This should include a pilot program to hire inspectors fluent in key languages other than English, to work with migrant workers and communities, and ensure that migrant workers in particular are better protected from underpayments, and more confident to query pay and conditions.

Policy Recommendation: 

  • Enhance the compliance capability of the Fair Work Ombudsman

2. Retain and continue to fund the Australian Building and Construction Commission

CCIQ welcomes the Government’s commitment in December 2018 to provide an additional $3.7 million in funding to the Australian Building and Construction Commission (ABCC) to enhance its ability to enforce and maintain the rule of law on Australia’s building and construction sites.

The ABCC plays an essential role in not only protecting freedom of association, but also in the costs of our built environment, the productive capacity of Australia, and our attractiveness as a place to invest and do business. It is vital the ABCC continues to be appropriately funded and resourced in order to ensure increased workplace productivity, reduced disputes and delays and greater cooperation between workers and employers on Australia’s commercial building sites.

Since the ABCC came into being, we have seen ongoing validation of the need for its continuation, as it delivers significant benefits to not only the almost 1.2 million construction workers and more than 367,000 small businesses in the building and construction industry, but to the wider community. Without the ABCC we would tacitly approve and entrench fundamental cultural problems in the building and construction sector, growing disregard for the rule of law, important building projects costing more time and money to complete than they should, threats to the wellbeing of participants, damage to the performance and reputation of the industry and the discouragement of investment and job creation.

Policy Recommendation: 

  • Continue funding for the Australian Building and Construction Commission

3. Appropriately resource the Fair Work Commission

There is clear evidence that the Fair Work Act and its strictures are posing operational problems for Fair Work Commission (FWC), and impacting on its effectiveness. In 2017-18 the FWC took more than twice the time to finalise enterprise agreement approvals compared to its target, with a median time of 76 days against the budget statement target of 32 days. When considering the median time for enterprise agreements approved with undertakings this figure blows out to 93 days.

Delays in enterprise agreement approvals is a significant problem for employers, employees and the broader economy. With productivity across the economy slowing and the underlying budget position during 2018-19 and beyond driven by assumed higher wages growth it is vital that the current delays in enterprise agreements approvals are addressed.

Modest but necessary additional funding is needed to ensure that the FWC can provide a timely and efficient service of enterprise agreement approval. This will complement and support the recent appointment of new FWC members, which employers strongly supported, but which now needs to be backed up through appropriate agency level resourcing. We encourage the Government to further address the current problems being experienced in enterprise approvals by providing additional funding to the FWC to appoint new tribunal members to satisfy the increased workload expected of the FWC.

Policy Recommendation: 

  • Provide additional funding to the Fair Work Commission in order to address the significant delays being experienced in the approval of enterprise agreements.