Updated: Fair Work Australia (FWA) has rejected an application made by Toyota under section 424 of the Fair Work Act 2009 to suspend planned industrial action at the Altona plant.

The application related to work stoppages at Toyota’s Altona plant in pursuit of the proposed Toyota enterprise agreement; the Australian Manufacturing Workers Union (AMWU) and Communications Electrical Plumbing Union (CEPU) are seeking a pay increase of 12 per cent over three years.

Toyota had offered a wage increase proposal of 11 per cent over 39 months in late July and last week, as well as three options for a seven per cent increase over 2 years plus a bonus. All offers were rejected by the unions.

Section 424 of the Fair Work Act 2009 provides that FWA must terminate protected industrial action where FWA is satisfied that the protected industrial action has threatened, is threatening, or would threaten to endanger the life, the personal safety or health, or the welfare, of the population or of part of it; or to cause significant damage to the Australian economy or an important part of it.

Toyota’s application stated that further industrial action would cause serious economic harm to the company and its downstream suppliers. The Altona plant produces the 4-cylinder Camry, Hybrid Camry, and 6-cylinder Aurion models.

More than 3300 employees build 559 cars per day, for domestic and export customers. Toyota Australia produced more than 119,000 vehicles in 2010. The Melbourne and Sydney parts centres distribute Toyota parts and accessories nationally.

After issuing an interim suspension of industrial action, Fair Work Australia Commissioner Julius Roe declined to extend the suspension, stating the “degree and nature of the threatened harm is not exceptional”.

“It does not go sufficiently beyond the common inconvenience and common consequence of industrial action,” Commissioner Roe declared.

This was an important case, both for the interpretation of the Fair Work framework and for Victoria’s economy, to which manufacturing is central.

Recent debate about declining productivity in Australia, alongside reduced flexibility in the Fair Work framework, has renewed discussion about whether the regulatory pressures introduced by the Fair Work Act might be ameliorated by the reintroduction of individual statutory agreements.

Individual statutory agreements, known as Australian Workplace Agreements (AWAs), were a key plank of the Howard Government’s reforms to the Workplace Relations Act 1996, known as ‘WorkChoices’.

AWAs were only one feature of a complex system of reforms which extended to machinery of government, statutory minima, unfair dismissal, freedom of association and collective bargaining (among other aspects of industrial regulation). The removal of AWAs went well beyond ‘rolling back WorkChoices’.

As discussed on this blog, meaningful debate and discussion about lagging Australian productivity and the linkage to IR regulation continues to be rebuffed by the union movement and the Labor Government. Responses by the ACTU, the Federal Government and others to significant and reasoned contributions to this discussion continue to parrot responses about the business agenda – and that of the Federal Opposition, as well as the Reserve Bank chief – to ‘bring back WorkChoices’.

The recent arguments for the benefits of reintroducing some form of individual statutory agreements within the existing Fair Work system – or at the very least, making flexibility terms in modern awards more expansive, and thus enabling the making of more reliable and substantive Individual Flexibility Arrangements between an employer and employee – appear to be suffering the same fate.

Whether or not individual statutory agreements are absolutely the solution to our current impasse is certainly worthy of close consideration. Our workplaces are certainly impacted by broader individualising social trends, which are evidenced by declining union membership, among other things.

The question must then be: what is the best mechanism for enabling agreements between employers and employees that promote flexibility and productivity at the workplace level? Is our industrial regulation, predicated as it is on a model of arbitration and disputation, and enterprise bargaining, out of step?

Notwithstanding the outcome of such analysis, the fact remains that industrial regulation must be addressed not just within the electoral cycle, but as part of the ongoing scanning of the viability of regulatory frameworks for the success of Australia’s economy.

The reviews scheduled for 2012 – pertaining to modern awards and the Fair Work Act 2009 – both provide appropriate opportunities to address the issue of the linkage between industrial regulation and declining productivity. The Federal Government and Fair Work Australia must ensure that the scope of these reviews is appropriately broad in order to enable a full consideration of the deficiencies, as well as the benefits, of the existing regulatory framework.

Industrial regulation must not act as a barrier to Australia’s economic performance and competitiveness. Analysis of the character and effect of Australia’s industrial regulation must be both robust and fearless, lest we fall into the trap of ‘lazy reform’ recently described by former BHP Billiton chairman Don Argus.

Have your say on this topic in comments or in our reader poll!

Meaningful debate and discussion about lagging Australian productivity and the linkage to IR regulation continues to be rebuffed by the union movement and the Labor Government. Responses by the ACTU, the Federal Government and others to significant and reasoned contributions to this discussion continue to parrot responses about the business agenda – and that of the Federal Opposition, as well as the Reserve Bank’s chief – to ‘bring back WorkChoices’.

This has been seen in recent days, where not only press releases out of the office of the Minister for Jobs and Workplace Relations, but also commentary in the press from union officials, do no justice to the complexity of the issues at stake and attempt to portray business concerns as an attempt to revive WorkChoices. Accordingly, analysis of the challenges to Australia’s productivity, both now and in the future, along with reforms needed to achieve improvements, is sidelined.

Doing so does a disservice not only to business, but also to employees, many of whom suffer the impact of the issues to which the business debate about the nexus between IR regulation and the slump in Australian productivity – these have been variously described and evidenced in recent days.

However, the Federal Government and the union movement persist in doing so, despite the consistency of the message from agencies such as the Productivity Commission and the Reserve Bank, who have each recently identified and substantiated a link between excessive labour regulation and straitened market conditions. While labour regulation is not the only constituent factor in this complex scenario, it is certainly one factor – and deserves appropriate consideration by the Federal Government. 

The other plank of the Government’s communications strategy is also key to the limitations on public discourse about industrial relations – that is, the insistence that the reforms achieved have delivered good outcomes for both business and for workers, and that business simply isn’t taking up the advantages afforded by the Fair Work Act. In short, it’s the fault of business, not the regulatory framework.

Rather than insisting that the Fair Work framework is continuing to deliver improvements, the Federal Government needs to remove its head from the sand and engage meaningfully with business about the real impact of the Fair Work Act 2009.

It is clearly time for a robust debate about IR which is not fettered by the rhetorical device of ‘WorkChoices’, which is used to shut down meaningful debate on this important issue – and which certainly misrepresents, over-simplifies and discredits the agenda and case for change identified by Australian business, and prosecuted by organisations such as VECCI.

The review of the Fair Work Act 2009 in 2012 should be one means by which appropriate reforms to the framework identified by the protagonists in the debate about IR reform can be realised. However, the frequent recourse to a strategy that focuses on attacking business through the repetition of tired rhetoric about a ‘return to WorkChoices’ will only hamper the efficient conduct of the review.

Fair Work Australia has dismissed an unfair dismissal application by an employee who was summarily dismissed for serious misconduct after breaching a workplace policy by posting an abusive and threatening Facebook status, complaining he wasn’t being paid correctly.

The employee, a computer repairer who had worked for the Townsville computer store for nearly four years, had been in dialogue with the operations manager about some commissions he believed he was entitled to and hadn’t been paid yet.

He decided to express his frustration about the issue online, posting on Facebook, “wonders how the f*** work can be so f****** useless and mess up my pay again. C**** are going down tomorrow.”

Among his 70 Facebook ‘friends’ were several co-workers, who reported the comments to the employer. On the same day he posted the comments; the area manager phoned and told him he would have to explain his comments to the store’s director. The employer took the view that the message was a direct threat to the operations manager.

The following day the director and employee met, where the employee confirmed he had authored the Facebook status update and that it was directed towards the operations manager.

The director told a Fair Work Australia hearing he told the employee, “I am taking it you resigned. You can’t work here – you made threats against us.” The employee alleged the director threatened to sue him if he did not resign, and shoved him towards the stairs, although the director said he only tried to guide him towards the door to indicate he should leave immediately.

Days afterwards, the employee then received a letter of termination, along with three weeks’ payment in lieu of notice and accrued annual leave.

Deputy President Swan said the employee’s Facebook statement was a breach of the company’s employee handbook, which stated staff should “not use offensive language, resort to personal abuse or threaten or engage in physical contact” in communicating with other staff.

“The (employee) was aware that there were other work colleagues on his Facebook group who could see the comments made and this is precisely what happened,” Deputy President Swan said.

“The fact that the comments were made on the (employee)’s home computer, out of work hours, does not make any difference. The comments were read by work colleagues and it was not long before (the Operations Manager) was advised of what had occurred.”

Deputy President Swan acknowledged the employee’s frustration at his pay issues, but the manner of his threat and the words used were sufficient reason for dismissal on the grounds of serious misconduct.

The result of this case further affirms an employer’s right to enforce policies and procedures and, where they are breached, sanction an employee – even where comments are published outside the workplace and/or work hours. Employers may want to consider a social media usage policy to clarify what is and isn’t acceptable comment, to reflect this continuing blurring of the lines between work life and private life.

It is also important to note that the employer afforded the employee procedural fairness before terminating the employee’s employment summarily – and that this was critical in the decision made by Fair Work Australia.

A wide-ranging Productivity Commission draft report into the state of Australian retail has recommended a host of regulation reforms, including total deregulation of trading hours, and an examination of the impact of the Fair Work Act – including the modern General Retail Industry Award 2010 - on the struggling sector.

While the raft of regulatory review and reform recommended by the Commission is extensive, the focus on industrial regulation is particularly significant as it suggests further evidence to support arguments by business and industry that the Fair Work Act has proven to be a barrier to the viability of business. It also demonstrates the emptiness of the rhetoric that ‘no-one will be worse off under modern awards’.

The report was commissioned to investigate the impacts of globalisation on Australian retailers, in the wake of the high Australian dollar and the emergence of international online stores.

The report suggested the post-implementation review of the Fair Work Act 2009, scheduled to commence as soon as practicable after 1 January 2012, is an appropriate mechanism for a substantive examination of the retail industry’s concerns over flexibility and employment costs arising from implementation of the legislative framework.

The cost impost of the implementation of modern awards has, as VECCI continues to advocate, been significant for many businesses. Retail businesses are obliged to comply with a minimum engagement of three hours for part time and casual staff, as prescribed by the modern retail award. (A concession of 90 minute shifts for secondary school students was recently won by the National Retailers Association; however this decision is currently being appealed.)

Furthermore, many employers are finding that the terms of modern awards are complex and difficult to understand; some have reported difficulty calculating appropriate award rates, particularly given the transitional provisions in the modern retail award.

“(The review) should include consideration of options to address any significant obstacles to the efficient negotiation of enterprise-based arrangements that have the potential to improve overall productivity,” the report states.

The report recommended the Fair Work Ombudsman better promote and refine its services to assist retailers with award rates, and urged employers and employees to take “full advantage of the opportunities to incorporate productivity-related provisions” contained within the Act.

On the regulatory front, the report urged full deregulation of trading hours to allow retailers to open their doors whenever they want on any day they want, including all public holidays.

“In today’s more competitive retail trading environment, where consumers have greater access to goods from all over the world and can order those goods any time of day, there is a greater imperative for retailers to have the ability to respond to changing consumer tastes and preferences,” it states.

The report also recommends:

• A reduction in the $1000 GST-free threshold on imported goods, as advocated by many leading retailing figures, should only be considered unless it is “cost-effective” (if the cost of collecting the extra revenue doesn’t exceed the extra revenue)
• Planning and zoning reform at state and local government level to “facilitate new retail formats” in existing business zones
• Reduction in planning and development compliance costs and a reduction of “regulatory inconsistency” across jurisdictions.

The release of the draft report follows new statistics that show the growth of retail sales is at its slowest level in nearly 50 years.

It is obvious there is no quick fix to retailers’ issues as consumers increasingly look to alternatives to traditional bricks and mortar stores for many of their goods. The draft report does however identify areas where all levels of government can step in and help make life just a little easier for Australia’s 140,000 retailers.

Comment on the draft report can be made until Friday 2 September.

Do you agree with the recommendations of the Productivity Commission’s draft report? What else can be done to make running a retail business more profitable? We’d like your thoughts on this issue.

The new President of Australia’s peak medical body, the Australian Medical Association, has criticised those employers who require their staff to produce medical certificates for solitary sick days.

Dr Steve Hambleton says workers required to get a medical certificate for taking a day of sick leave are placing a drain on the nation’s healthcare system.

“Employers trust their employees with their finances but won’t trust them when they are sick,” he said,” Dr Hambleton said on the weekend. “A lot of time is wasted by doctors who have to sign medical forms for people who don’t need medical intervention.”

Dr Hambleton said a debate needed to be had about whether the Federal Government should amend current industrial relations laws to try and ease the burden on GPs and doctors.

Does Dr Hambleton have a point in arguing that these employers are placing demands on the nation’s healthcare system by requiring evidence of illness or injury? Do the provisions of the Fair Work Act 2009 need to be amended?

At this time it’s convenient to consult the phrasing of the provisions of the Fair Work Act relating to personal leave and the evidence required to take it.

Section 97 of the Act specifies an employee may take personal leave if they are “not fit for work because of a personal illness, or a personal injury” and section 107 states that, only “if required by the employer”, that they give evidence “that would satisfy a reasonable person”.

No mention is made in legislation at any time of what this evidence consists of – there is no obligation for it to be a certificate from a doctor. There is no obligation for this evidence to even be in document form.

Of course, many employers will have their own provisions that need to be met for personal leave to be taken, and it is perhaps at this level that changes might be made.

We’d like to know what you think – what kinds of evidence do you require (or are you required to give) for a period of personal leave? What do you think is ‘reasonable’? Let us know!

Workplace relations – and the regulatory framework appropriate to Australia’s workplaces – is certainly once more a topic of discussion and debate.

With news the Federal Opposition will go to the next election with an IR policy that’s about ‘problem-solving’ rather than about ideology, it’s certainly time to consider what aspects of the Fair Work Act 2009 may or may not be working.

This is also timely, given that a post-implementation review of the Act will commence ‘as soon as practicable’ after 1 January 2012.

Recent comments by Scott Morrison, the Opposition’s immigration spokesperson, have suggested some of the key aspects of the Act that the Opposition’s policy might consider. Speaking at an Australian Mines and Metals Association (AMMA) event, Morrison described the ‘healthy appetite’ of the Coalition “to deal with IR challenges that we have in this country”.

In discussions with Morrison, AMMA Chief Executive Steve Knott had raised a number of issues as the ‘practical challenges’ with which a Federal Opposition policy must grapple – among these, union right-of-entry, approval of contractors and access to meal rooms to talk to members, as among resource employer concerns.

VECCI is also closely observing the effect of the implementation on employers, and on business in Victoria – at a time when productivity is in decline, the task of workplace regulation reform seems all the more urgent.

We’d like to know what you think – please contribute to our poll, and tell us in comments below what your experience of the Fair Work Act 2009 has been, and what potential changes you’d like to see.

A former electorate officer with a federal Member of Parliament whose position was made redundant has been awarded more than $7,500 by Fair Work Australia, which found she was not given an opportunity to apply for a different position and, as such, had been unfairly dismissed.

The employee had worked in the office as a Senior Advisor/Electoral Office Manager since 2008, and was on personal leave awaiting surgery in August 2010 when she was advised that her position was redundant.

The employee was then required to attend a formal meeting in September where she was told she would have to apply for another position, as her former position had become redundant. The employee stated at a Fair Work Australia hearing that she was not given further details of the new office structure, the details of the new positions available, or the application deadline. Her employment was then subsequently terminated.

The employee believed she would have had the necessary skills and experience to fill one of two new roles created – Media and Public Relations Advisor or Entitlements Manager.

The employer argued before Fair Work Australia that all new positions were advertised publicly online and the business case for the restructure, and resulting redundancy, were sound and that the restructure was necessary after some malfunctioning of the office during the 2010 Federal Election campaign. Evidence was heard that the employee accessed emails between two colleagues criticising her and showing they were going around her, and not reporting to her as the office structure then dictated.

The employer also expressed the view that the employee had demonstrated an unwillingness to engage in discussion about the restructure, and that remuneration for the new positions was below what the employee had previously received.

Commissioner Bruce Williams rejected the employee’s assertion that the restructure was a sham, and found there was no underlying reason for why it was conducted while the employee was on sick leave.

“Ultimately decisions about staffing arrangements are for the employer and inevitably different managers or employers will have different views given the same circumstances as to what they believe is the most appropriate staffing structure,” Commissioner Williams said.

However, the employer’s failure to offer redeployment to one of the new positions, despite her obvious skills and experience, meant her redundancy could not be considered genuine, and was therefore unfair dismissal, Commissioner Williams found.

“It is not correct to assume that the (employee’s) unwillingness to apply for the new positions meant she would not have positively considered accepting redeployment to one of these positions if this had been offered,” he said.

“The two circumstances are qualitatively different. An offer of redeployment for example would have largely removed any belief the (employee) held that the restructure was a sham designed to remove her from the office.

“The fact that the new positions were at a lower grade than her job that had been made redundant may have discouraged her from accepting redeployment but this was not for the (employer) to prejudge.”

Commissioner Williams ruled that reinstatement was inappropriate due to the poor relationships with her former colleagues, and awarded compensation of $7,596 for lost earnings.

Employers are advised when planning restructures of their businesses to consult thoroughly with all affected employees, and examine all possible avenues of redeployment within the organisation before considering termination. Employers must be particularly aware, as this case demonstrates, that only a ‘genuine’ redundancy will be a jurisdictional barrier to an employee making an unfair dismissal claim.

Planned industrial action by QANTAS engineers in which they will only use tools with their left hand is not only farcical, childish and dangerous, but could potentially threaten Australian jobs. 

The engineers’ ludicrous action will only serve to further the argument that Australia’s current industrial framework is unworkable.

For QANTAS to compete with international airlines based in Asia and the Middle East, it must be able to adapt to future changes in the aviation industry. If companies such as QANTAS, operating in incredibly competitive environments, are unable to adopt modern workplace practices in order to remain profitable, the future doesn’t look bright for Australia.

As QANTAS has stated, the engineers’ demands effectively represent a veto on future changes for the business – this doesn’t bode well for future investment.

It’s VECCI’s view that the demand for such clauses will in fact push jobs offshore, leading organisations such as QANTAS to domicile operations elsewhere, and potentially leaving thousands of Australians out of work in the process. 

Just days after the Fair Work Act’s second anniversary was marked, this industrial action from QANTAS engineers is again highlighting how precarious Australia’s industrial relations system is.

This case may in fact be another litmus test for the integrity and workability of the enterprise bargaining framework – and for Fair Work Australia.

The Federal Government is called upon to consider the impact of the Act – which places enterprise bargaining at the core of the system – upon business in Australia. Our reputation, competitiveness and productivity are at stake.