Below is my letter published in today’s Australian (including bits deleted by Ed) and two recent articles reporting on the decision by Justice Bromberg of the Federal Court rejecting the attempt by Toyota to seek changes in the enterprise agreement it has with unions. This vividly illustrates the difficulties faced by businesses under the Fair Work legislation and the judicial interpretation accorded to it by Bromberg and others.
But it also illustrates the urgent need to effect major reforms to the Fair Work Act. Those commentators who claim that businesses have failed to stand up for themselves by rejecting union claims should ask the question – what would the situation be if the Fair Work Act was repealed and replaced with a minimal regulatory arrangement that deals primarily with implied or actual breaches of contract. My letter makes one reform suggestion:
[Your editorial on the Productivity Commission’s initial analysis of the motor vehicle industry notes the rejection by federal court judge Bromberg of Toyota’s attempt to re-negotiate it’s agreement with unions if a majority of workers agreed] When seeking ALP pre-selection for a federal seat in 2001, Justice Mordecai Bromberg reportedly indicated his primary objective was to reverse the Workplace Relations Act [and, before being appointed to the judiciary in 2009, he acted more than once for the Construction Forestry Mining and Engineering Union.] (“High costs and workplace laws will cause job losses”, 21-22/12).
Justice Bromberg’s interpretation of the Fair Work Act in the Toyota case overlooks the need to recognise that changes in economic circumstances should allow for possible changes in terms and conditions for labour under existing awards or enterprise agreements where these can be shown to be outdated and uncompetitive.
Yet, under the Fair Work legislation, Toyota and several other manufacturing businesses have developed higher labour costs than those in other similar companies and this has led to job losses .
The Fair Work legislation ought to be adjusted to allow businesses to seek changes in terms and conditions. A special branch of the Productivity Commission could be created to examine claims for change. [If approved this would avoid the provision of taxpayer funded assistance.]
Des Moore is a member of the HR Nicholls Society Board of Management