Workplace relations policy advice

Protecting vulnerable workers

The Department advised the Government on implementation of its election commitment to protect vulnerable workers. That commitment was made in response to several high-profile cases of worker exploitation and a range of evidence indicating that existing laws needed to be strengthened to deter unlawful behaviour. The Fair Work Amendment (Protecting Vulnerable Workers) Bill 2017, which was introduced into the Parliament on 1 March 2017, strengthens the Fair Work Act so as to more effectively deter the underpayment of workers. The Bill complements the other measures in the election commitment made to respond to worker exploitation—including increasing funding to the Fair Work Ombudsman ($20.1 million over four years) and establishing the Migrant Workers’ Taskforce.

The Royal Commission into Trade Union Governance and Corruption

The Department continued to advise and assist the Government in relation to implementation of its election commitment to improve the transparency and accountability of registered organisations and adopt the majority of the recommendations of the Royal Commission into Trade Union Governance and Corruption. Registered organisations are unions and employer associations registered under the Fair Work (Registered Organisations) Act. The Department assisted the Government with the passage of the Fair Work (Registered Organisations) Amendment Act 2016 through the Parliament on 22 November 2016. The amended Act provides for measures to strengthen the reporting and disclosure requirements for registered organisations and their officers, increase civil penalties and introduce criminal penalties, and establish a Registered Organisations Commission as an independent regulator.

The Department further supported the Government in introducing the Fair Work Amendment (Corrupting Benefits) Bill 2017. The legislation will ban corrupt and secret payments between employers and unions, as identified by the Trade Union Royal Commission. It will also require disclosure by both employers and unions of financial benefits they stand to gain as a result of an enterprise agreement before employees vote on the agreement.

The Fair Work Commission’s annual wage review

Together with the Department of the Treasury and in consultation with the Department of the Prime Minister and Cabinet and the Department of Social Services, the Department prepared the Government’s submission to the Fair Work Commission’s annual wage review. The Commission’s decision affects about 196,000 employees who are paid the national minimum wage rate and about 2.3 million employees on award classification wages.

On 6 June 2017, the Fair Work Commission announced its decision to increase the national minimum wage rate and award classification wages by 3.3 per cent. From 1 July 2017, the national minimum wage is to increase to $694.90 a week ($18.29 an hour).

Pay equity and participation

The Department continued to provide policy advice on matters relevant to women’s participation in paid work, including pay equity, analysis of the gender pay gap, workplace flexibility, workplace responses to domestic violence, and labour market gender segregation. The Department presented a submission to the Finance and Public Administration References Committee inquiry entitled Gender Segregation in the Workplace and Its Impact on Women’s Economic Equality and appeared at a public hearing of the inquiry on 26 April 2017.

The safety net, awards policy and superannuation

The Department continued to provide policy advice to the Government on safety net, modern award and superannuation matters throughout 2016–17. Highlights from the year are described below.

The Government’s Fair Work Amendment (Repeal of 4 Yearly Review and Other Measures) Bill 2017 was developed with the joint support of the Australian Industry Group, the Australian Chamber of Commerce and Industry and the Australian Council of Trade Unions. The Bill provides for removal of the requirement for the Fair Work Commission to conduct four-yearly reviews of modern awards from 1 January 2018. It will also enable the Fair Work Commission to overlook minor procedural or technical errors when approving an enterprise agreement. This delivers on the recommendations of the Productivity Commission’s final report into the Workplace Relations framework. The Bill also accommodates two recommendations made by the Hon Peter Heerey AM QC in his Report of Inquiry into Complaints about the Honourable Vice President Michael Lawler of the Fair Work Commission and Related Matters (the Heerey report). The Bill passed the House of Representatives on 20 June 2017.

In response to the Fair Work Commission’s decision on 23 February 2017 to reduce Sunday and public holiday penalty rates in hospitality and retail sector awards, the Department provided policy advice for two submissions the Government made to the Fair Work Commission in relation to transitional arrangements. The Department also represented the Government at a hearing on 9 May 2017. The transitional arrangements for Sunday penalty rates commenced on 1 July 2017 and will be phased in through yearly instalments over three to four years, depending on the award.

The Department is a member of an inter-agency working group providing advice to the Government on matters related to underpayment of the Superannuation Guarantee. It presented a submission to the Senate Economics References Committee Inquiry into Superannuation Guarantee Non-payment and appeared before the committee jointly with other members of the working group. The committee released its report on 2 May 2017; the Government is considering the recommendations.

The Coal Mining Industry (Long Service Leave) Corporation

The Department continued to provide assistance to the Coal Mining Industry (Long Service Leave) Corporation, which is responsible for administering the Coal Mining Industry Long Service Leave Fund. The special appropriation made to the corporation is dependent on levies collected from employers under the Coal Mining Industry (Long Service Leave) Payroll Levy Collection Act 1992.

The building and construction industry

The Australian Building and Construction Commission came into operation on 2 December 2016 and the Department is supporting its implementation. The Department provided policy and legal advice to support the development of the Building Code 2016, which also came into operation on 2 December 2016. The Department also provided policy and legal advice to support the Building and Construction Industry (Improving Productivity) Amendment Bill 2017. The Building and Construction Industry (Improving Productivity) Amendment Act 2017 commenced on 17 February 2017 and related amendments to the Building Code 2016 commenced on 21 February 2017.

The Department progressed appointments to establish the Security of Payments Working Group, as required by the Building and Construction Industry (Improving Productivity) Act 2016 and is supporting the review of state and territory security of payments laws.

International labour matters

During 2016–17, the Department provided policy advice to the Government on international labour matters, with a particular focus on the Asia–Pacific region.

An important part of the Department’s international engagement is representing Australian interests at the International Labour Organization (ILO) and participating in the management of that body through Australia’s elected position on the organisation’s governing body. Government delegates play an active role at ILO meetings, contributing an Australian perspective to the organization’s work and planning. Delegates also contribute to the regional and economic government groups of which Australia is a member—the Asia Pacific Group and the Industrialised Market Economies Group.

In June 2017, the Department represented the Government at the 106th session of the International Labour Conference, which hosted three main technical committees—a general discussion on labour migration, a recurrent discussion on fundamental principles and rights at work, and the second discussion on the revision of the Employment (Transition from War to Peace) Recommendation, 1944 (No. 71). The Department played a key role in the discussions and outcomes of all three committees. Australia was also re-elected to represent the Far-East Asia and the Pacific Sub-Group of countries on the governing body for a three-year term, from 2017 to 2020, at the elections held during the International Labour Conference.

The Department represented the Government at ILO governing body meetings in October−November 2016, March 2017 and June 2017, continuing to advocate and engage on agenda items of relevance to Australia’s domestic and foreign policy interests.

The Department also participated in the Asia–Pacific Regional Meeting in December 2016; the meeting agreed to the Bali Declaration, which outlines the impact of the ILO’s Asia–Pacific Decent Work Decade and sets priorities for national policy and action for the coming five years. Australian delegates played an active role in the conference, participating in a panel discussion on skills for the future and as a member of the drafting committee for the Bali Declaration.

During 2016–17, the Department’s Minister-Counsellor (Employment) was Australia’s representative at the ILO. The representative participated in ILO meetings throughout the reporting year, including the Tripartite Meeting of Experts on Fair Recruitment and the Tripartite Meeting of Experts on Violence against Men and Women in the World of Work.

The Department has worked with the Department of Foreign Affairs and Trade on regional aid projects, including the Better Work program, which has been funded by the Department of Foreign Affairs and Trade since 1 June 2016. Better Work engages business, civil society and governments to assess workplace conditions in the garment industry and create strategies for improving labour standards and addressing gender issues. Both departments also work together on the ILO’s TRIANGLE in ASEAN program, to which the Department of Foreign Affairs and Trade has committed $20 million in funding from 2015 to 2025. This program operates migrant resource centres, which provide information on safe and legal labour migration to increase the proportion of workers who migrate successfully through legitimate channels.