u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Individual Agreements – developing a more appropriate regulatory framework Ron Callus Director acirrt, university of sydney Paper presented at the IRS of WA 2002 Annual Convention Rottnest Island October 2002

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m OverviewOverview Scope of Individual agreements in Australia Why employers introduce them Characteristics of employers with AWA’s What’s different about Hospitality AWAs Is there a better way to regulate (the industry)?

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Why Individual agreements? Award not appropriate to needs of “business” Agreements more appropriate for cost minimisation and/or productivity enhancement Want agreement that better reflects values and priorities Part of strategy to marginalise union and change from collective to individual relationship

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Scope of AWAs in Australia Source: Office of Employment Advocate, Monthly Releases, 1 October 2002, cumulative figures *ABS, Cat no , December, 2001 Note: These are cumulative figures therefore over-estimate the current use of AWA’s.

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Characteristics of Employers with AWAs Source: Gollan, OEA AWA Employer Survey, 2000 Office of Employment Advocate, Monthly Releases, February 2001 More likely to be from Transport & Storage, Retail Trade and Property & Business Services in the private sector (80%) In the private sector - overwhelmingly small to medium sized employers (Less than 100 employees) Nearly half operate for more than 12 hours per day About half of organisations with AWAs operate 7 days a week Most cited reasons for having AWAs - flexibility of hours - simplify employment conditions Nearly 50% of employers with AWAs offer them to a minority of their employees. More likely to be offered to managers, professionals or para professionals.

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m General Features of AWA’s The no disadvantage test is to the award not previous agreement (if appropriate) No net disadvantage – criteria unclear Are less likely to involve a “bargaining agent” Invariably initiated by the employer Less likely than other agreements to provide for guaranteed wage rise during the life of the agreement Tend to be standardised not unique Like collective agreements the majority provide for changes to working time arrangements Has been growth in AWA’s in WA- making up 21.3% of all new AWAS approved in the last three months of 2001 (largest incr next to NSW)

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Accommodation, Restaurant AWAs Currently constitute about 7% of all AWAs AWA’s cover about 2.5% of the working population in this industry Differ markedly from union certified agreements Findings about AWA’s very similar to what we found about 200 WA IWA’s

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m AWAs compared to Collective (union) agreements in Hospitality Hospitality AWAs are more likely to: have hours flexibility provisions (79% v 60%) provide for paying out part of holidays (97% v 83%) have annualised wages (26% v 17%) absorb overtime penalties(27% v 10%) absorb leave loading(26% v 3%) absorb allowances(39% v 3%) ordinary hours > 38 per wk(32% v 7%) span of hours >12(12% v 7%) confidentiality clause(22% v 0%) superannuation provision (74% v 37%) 5 weeks annual leave(24% v 7%)

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m AWAs compared to Collective (union) agreements in Hospitality Hospitality AWAs are LESS likely to: guaranteed AAWI provision (16% v 63%) any form of wage incr provision (34% v 73%) family friendly provisions (4% v 23%) paid Mat leave (0% v 7%) sick leave >10 days year(40% v 63%) meal allowance(15% v 40%) clothing allowance(40% v 53%) laundry allowance(4% v 30%) span of hours >12(12% v 7%) training provisions(27% v 60%) higher duties allowances(0% v 10%)

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Micro problems with AWA’s for employers time and resource costs benefits more limited and less than expected no benchmark or reference point for standards no evidence that it delivers commitment by employees.

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Real challenges for employers 1.Debate over the regulatory form - AWA or EAs - misses the problems facing employers and workers 2.The efficiency needs of employers and the fairness and “outcome” needs of employees both have an industry dimension that the current regulatory system(s) do not address

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Industry – the key to effective regulations Regulatory issues around the following should vary because of the characteristics of the industry: OH&S standards/needs training and skills development minimum wages working time arrangements work and family issues that reflect the age profile forms of engagement

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Focus on Industry Current regulatory mess makes it impossible for employers and employees to know what applies to them or where do you go to find out Regulatory systems that are industry specific make more sense -one size does not fit all industries Precedent for industry wide regulatory bodies eg Coal, Flight Crew, Universities – but need to go beyond just wage setting and dispute setting. Elements already there with the Panel system in the Commission eg an Industry Board would: –Set standards or makes rules relevant to the industry on a range of issues –Disseminate information about national and industry laws and rules that apply to that industry – one stop shop for employers and employees seeking assistance or remedies –Enforce rules that apply in that industry –Be an independent statutory body with the necessary powers and resources

u n i v e r s i t y o f s y d n e y a c i r r t w w w. a c I r r t. c o m Industry standards BUT….still need a range of agreed community wide standards – irrespective of industry eg: - Level of workers compensation -Duty of care in OHS -National anti-discrimination laws - Unemployment benefits -Uniform unfair dismissal standards -Rights to organise and take industrial action -National minimum wages (SNA) -Paid maternity leave -Minimum sick & holiday leave standards - Protection of entitlements scheme - National superannuation scheme etc.