The VECCI Blog

By The Editor

Recent research is further evidence that the implementation of the Fair Work Act is time-consuming and expensive for business.

The Australian Human Resources Institute questioned nearly 1000 human resources and industrial relations practitioners on their dealings with the Fair Work Act, and found:

• 66 per cent of respondents said they were devoting more time to industrial relations issues under the Fair Work Act.
• Only nine per cent said the Act had made their job easier, as opposed to 57 per cent who said it was harder.
• 53 per cent found dealing with industrial relations issues was more expensive, and nearly three-quarters said there was an increased need for legal advice as a result of the Act.
• Nearly 30 per cent said it was more difficult to manage workplace disputes, while another 54 per cent found the Act had made no change.

While the respondents saw modest scope for improvements in the immediate future as business becomes used to the laws, only 16 per cent of respondents believed they would spend less time on industrial relations and formulating contracts next year. Even more concerning is that more than half (53 per cent) of the respondents see the Fair Work Act having a negative impact on productivity growth over the next three years.

Along with the reported increase in disputation, and the added costs of managing industrial disputes, the survey suggests that the transition to the new legislation has, for many businesses, been both complex and costly.

One respondent’s comments are suggestive of the ongoing debate as to whether the Fair Work Act represents an appropriate balance – “Both Work Choices and the Fair Work Act are extremes and fail to acknowledge industry’s needs and a fair balance of protections for employees”, the respondent said.

While the report focuses on the difficulties businesses have experienced during the transition period, it’s likely that the implementation of the Fair Work Act 2009 will continue to have an impact, particularly with respect to the interpretation of the Act – and decisions made by Fair Work Australia – around employee entitlements and termination of employment, and the management of industrial disputes.

While the Federal Government continues to state that further amendments to the Act will not be contemplated, there is every indication that industrial relations will be on the agenda once more at the next Federal Election. In the interim, the experience of HR and IR practitioners is telling as to the success of the latest workplace reforms.

This entry was posted on Monday, November 8th, 2010 at 8:09 am and is filed under Workplace. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.