The Australian Higher Education Industrial Association (AHEIA) has called upon the federal government to repeal a section of the Fair Work Act, which it says stifles productivity.
AHEIA has written to the Treasurer, Dr Jim Chalmers, calling for section 270A of the Act to be dumped to restore a system that allows for arbitration in matters of intractable bargaining that has been in place for decades.
The original Albanese government Secure Jobs Better Pay measures had enormous potential to focus the minds of all at the bargaining table to reach a resolution, or lose something.
"Section 270A will impact on the bargaining process to take compromise out of the equation and entrench old fashioned and anachronistic provisions," the Executive Director of AHEIA, Craig Laughton said.
"This in turn will have a negative impact on productivity."
Mr Laughton said at present that while productivity through enterprise bargaining was an important object in the Act, the Fair Work Commission (FWC) now has had its agreement making influence and arbitration abilities severely curtailed.
Under Section 270A, the FWC cannot arbitrate a term into a new agreement that is less favourable than the existing one. Unions now are encouraged to dig in on terms they do not wish to change, confident the FWC will leave these untouched.
"At a time when productivity has been falling, the nation's economy is being challenged with rising unemployment and inflation and the prospect of increasing interest rates, road blocks to reform and sensible outcomes should be eliminated," he said.
Mr Laughton said the present approach will:
- lock in outdated EA provisions, processes and red tape even when they are not fit for purpose;
- discourage reform and good faith bargaining, as unions can resist change knowing any arbitration will default to legacy clauses;
- put downward pressure of wage offers and increase the incidence of arbitrated pay outcomes; and
- undermine the Commission's discretion, reducing its ability to resolve disputes in a balanced and forward-looking manner.
AHEIA has recommended the federal government:
- repeal or amend Section 270A to restore balance and integrity to the bargaining system;
- empower the FWC to arbitrate based on the totality of the agreement using the Act's objectives as guiding principles;
- support genuine bargaining that enables win- win outcomes for employees and employers and encourages reform;
- ensure that enterprise agreements remain tools for productivity improvement and sustainable salary increases – vehicles for reform, not barriers to it; and
- task the Productivity Commission with undertaking a targeted review of the sector's industrial relations frameworks to identify actionable measures that modernise legacy provisions, enhance flexibility in work allocation, improve job security and strengthen productivity across the university sector.
"AHEIA is encouraged by the government's focus on increasing productivity and is hopeful it will adjust the Fair Work Act in the way proposed to facilitate that," Mr Laughton said.
